Different from business as usual: unique talent management principles in inclusive business
Kindly introduce yourself and your area of work.
I am the Knowledge and Partnerships Lead at the Business Call to Action (BCtA). I see my role as the integrator between the different functions of our team, which includes our outreach and membership colleagues, impact gurus, communications ace and our precious focal points in our focus countries. I work very closely with the Head of BCtA to execute our big audacious inclusive business ideas and build strong partnerships with donors, other inclusive business actors and thought leaders around the world. I also lead our research into new, exciting and important areas of inclusive business – for example we’re currently finalising a study on how management practices can make or break an inclusive business, examining key management habits that successful inclusive businesses have adopted.
BCtA is the largest global inclusive business platform advancing core business solutions for development and providing public recognition for the private sector’s contribution to development. Launched at the United Nations in 2008, we aim to accelerate progress towards the Sustainable Development Goals by challenging companies to develop inclusive business models that engage people at the base of the economic pyramid (BoP) as consumers, producers, suppliers, distributors of goods and services and employees.
It appears the inclusive business talent gap is widespread—impacting companies at every growth stage. Can the impact of this gap be quantified, financially or otherwise?
The talent gap is indeed wide, and it does represent an important internal barrier preventing inclusive businesses from achieving growth and scale. As part of our inclusive business management practices study supported by the Business Innovation Facility we engaged with several business leaders to understand how they perceive and manage talent. We are not looking at quantifying the impact but rather understanding how successful IBs do it, what their magic recipe is, and how they build a strong qualified and motivated workforce to achieve their inclusive business objectives.
Our findings show that successful inclusive businesses appear to apply principles that are quite different from business-as-usual. This is valid for the ten cross-cutting management practices we identified, including those that relate to talent management: value-based talent management practices that build skilled loyal staff; staff wellbeing management; and coherent performance incentives for management tied to IB success. These practices allow companies to develop the skills of their workforce and nurture talent, which results in increased staff retention, job satisfaction and greater support among the workforce of the inclusive business mandate of a company.
So, what is unique about talent management in the world of inclusive business?
Hunting for the best talent has become a widespread practice in most companies today. Executives are regularly looking outside their organisation to find talented professionals to fill key posts. Companies have developed different strategies to lure talents away from their employers; bonuses, stock options, compensation packages are just some of the offering companies put on the table to build a winning team. Identifying and attracting strong assets is only one side of the coin, the other side - developing, promoting and retaining these high potential employees - is equally important and, perhaps, more challenging.
Every member company that took part in our research highlighted the importance of sourcing, attracting, selecting, developing, promoting and retaining high-potential employees through the company. Across firms interviewed, the tendency was to focus on the talents of all employees. Inclusive businesses usually adopt and nurture an inclusive approach to talent management. They believe that putting too much emphasis on top players could damage moral and alienate opportunities to achieve broader gains. Pinpointing to the series of distinct approaches IB developed to successfully recruit and select talented people, develop them, manage their performance, compensate and reward them and try to retain the strongest performers.
The DBL group is one of the BCtA companies that has successfully implemented targeted initiatives to increase the retention rate and wellbeing of their employees. In 2008, DBL decided to establish a “Bandhan” Fair Price Shop – which to date is one of the highlights of the Group’s achievements. The lack of shops for providing everyday items caused a high turnover of workers located in remote factories. On average, within three months of opening a Bandhan shop, staff turnover reduced by more than one-third. Today, all of DBL’s factory complexes have their own Bandhan shop. What was initially created as an initiative to help out low-income workers has turned out to be a central to DBL’s success, as the company has been able to retain more skilled employees throughout the years thanks in part to this initiative. The detailed case study will be included in our upcoming report.
How much investment do you think is required to tackle this challenge system-wide?
Without exception, every company interviewed expressed the importance of talent management to their inclusive business success. Investing in quality recruitment was a priority for them. Successful companies generally invest significantly in human resources infrastructure and resources.
When discussing talent management, our research focuses on two distinct practices: identifying and attracting the right talent for the inclusive business on one hand, and developing and retaining high potential employees on the other. What truly makes good companies great is their ability to attract and retain the right people—employees who are excited by what they’re doing and the environment they’re operating in. Such people are more likely to be deeply engaged in their work and less likely to chase after slightly better salaries or benefits. They will find ways to satisfy their own preferences and aspirations while meeting the organization’s need to come up with creative and productive solutions to business problems.
Is there a silver bullet to developing the talent the inclusive business sector needs, or will it require several different approaches?
As with most challenges in life, there is no silver bullet I’m afraid. It will require a mix of approaches. I see two important trends, one related to new disruptive technologies such as AI and the other related to automation, the future of work and the increased attention on what we call ‘soft skills’ (although there is nothing soft in them!).
Artificial intelligence (AI) has repositioned human resources at the front lines. Talent leaders are turning to cognitive technology like AI to help revamp their workforce while offering current employees personalised career development. Talent is no longer defined solely by what employees have done in the past, but also what they could do in the future. By matching the delivery of employee learning opportunities with the evolving needs of inclusive business, AI in human resources can help individuals and teams respond to constant change in BoP markets with speed and agility. Inclusive business should really embrace the opportunities offered by AI.
Automation on the other hand, poses a practical challenge. Business leaders must learn how to take advantage of the productivity and innovation opportunities presented by automation technologies, while ensuring a smooth workforce transition. To address automation in a way that will continue bringing value to inclusive business, business leaders will also have to help their current employees to adapt to new technologies or retrain for new occupations, and build a future talent pipeline capable of meeting the needs of an automated workplace.
The rollout of automation will affect different industries, occupations, and communities at different points in time. Early notice is critical, so that workers and governments have time to plan for the transition, reskill and train for new occupations, and minimise time spent in unemployment. The European Union’s CEDEFOP has started an early warning system that forecasts needed skills and workforce changes. By contributing their projected future needs to these systems, companies can help current workers and students plan for the skills that will be in demand in a specific geographic area. Similar system could be created for IB.
A recent LinkedIn survey of 4,000 professionals including executives, managers and talent developers ranked ‘training for soft skills’ the first priority for talent development in 2018. In the age of automation, maintaining technical fluency across roles will be critical, but the pace of change is fuelling demand for adaptable, critical thinkers, communicators, and leaders. As technology accelerates, soft skills are in high demand to fuel people and business growth.
Automation is a type of global challenge that requires a coordinated and collaborative approach. Companies can play a critical role in the global effort to redefine the future of good jobs in the age of automation and build an economy that works for all. Business leaders can use their collective voice to encourage governments to adopt policy frameworks that support workers in the transition to automation. They can commit to partnerships with local educational systems, as well as open-source and online education, to prepare new generations of workers and upskill their incumbent workforce through onsite training and use of micro-credential programmes.
Do you know of any knowledge products that entrepreneurs can use if wanting to tackle the talent gap?
Our Inclusive Business Management Practices report will be available in July. The report will fill the information gap for companies who are looking to engage in IB activity or scale their IB and will be accompanied by a Benchmarking Tool, which allows companies to understand where they are at in their IB Management Practices compared to IB peers; select areas where they wish to improve and develop an improvement plan.