Leadership pipeline continues to concern Asian businesses, says Deloitte Study
Singapore, 21 February 2013 — Organisations need to pursue and balance both strategic and tactical talent objectives according to a research report released by Deloitte Consulting and the Human Capital Leadership Institute (HCLI). The report entitled "Fuelling the Asian growth engine – talent challenges, strategies and trends", provides insights to Asia-based organisations with a view to understanding their business priorities and the people strategies deployed to support these priorities. The research was conducted with senior business leaders and human resource professionals of 212 local organisations and foreign multinationals across 12 industries in seven Asian countries.
Despite the cultural or economic diversity of Asian countries, organisations in China, India, Indonesia, Malaysia, Singapore, Thailand and Vietnam agree that "driving business growth" (90%), "dealing with increased competition" (85%), "achieving better operational efficiency" (78%) and "managing cost pressures" (77%) are the top business challenges in Asia.
Human capital issues are widely recognised as being critical to business sustainability, competitiveness and success. These concerns firmly feature at the top of most CEOs' agendas. "This is especially evident in Asia, a region characterised by business opportunities in developing markets, where the pace of transformation is faster, and business and talent pressures more intense," stressed Mario Ferraro, Regional Human Capital Consulting Leader for Deloitte Southeast Asia.
Findings from the study reveal that the talent landscape across Asia is categorised by an overall scarcity of talent as reported by 71% of survey respondents. This talent shortage leads to intensified competition for the same resources, which in turn results in wage inflation and challenges in attracting and retaining the right employees. Furthermore, there is a dearth of leadership competencies in organisations across Asia and only about half of surveyed respondents (51%) feel that their leaders have adequate leadership competencies, highlighting a greater cause for concern.
Similar concerns are echoed by the business community in Singapore where 85% reported challenges on account of poor leadership pipeline due to insufficient availability and shortage of quality leaders. Respondents in Singapore rated the top three most challenging business priorities as "dealing with cost pressures" (88%), "driving business growth" (84%) and "dealing with increased competition" (80%). Rising costs and competitive pressures have also exacerbated challenges on the talent management front as well. In the face of these challenges, "it is reassuring to note that organisations in Singapore are currently focused on both immediate and short-term priorities, as well as more future oriented people management priorities," said Ferraro.
The landscape in Asia has its challenges – increased competition, costs and operational inefficiencies among them. To fuel their Asian growth engine, organisations need to find ways to manage urgent talent retention issues as well as more strategic talent management priorities such as ensuring a sufficient pipeline of talent and leaders for the future. Rather than make trade-offs, the key to success is to develop an integrated "talent ecosystem", using internal and external talent management infrastructure to successfully achieve both tactical and strategic objectives.
It is important for each organisation to ponder carefully on which practices would work best for them and to prioritise solutions based on the organisation's specific needs, capabilities and capacity.
You may access the full report here.
The Human Capital Leadership Institute (HCLI) is a national centre of excellence that facilitates organisations to accelerate leadership development and strategic human capital management capabilities in Asia, for a globalised Asia. Through its efforts, HCLI aims to develop global leaders with a strong understanding of leading in Asia, as well as to build Asian leaders with the ability to lead on the global stage. Established in 2010 with Singapore's Ministry of Manpower, the Singapore Economic Development Board and the Singapore Management University as strategic partners, the Institute achieves this by driving Pan-Asian industry relevant research, creating cutting edge executive development programmes and fostering rich networks between leaders in business, government, academia and consulting. The Institute offers the unique ability to bring together the best-in-class to share insights on understanding Asia, successfully doing business in Asia, and the implications on leadership and human capital strategies for Asia.