The Hunt for Global Talent
When I picked up a copy of The Daily Telegraph on a visit to London early last year, the headline "Biggest Brain Drain from UK in 50 Years" caught my eye. The newspaper quoted research saying that 3.247 million British-born people are living abroad, of whom more than 1.1 million are highly skilled university graduates.
The research claimed that Britain has suffered more loss of human capital than any other nation and blamed high taxes and bad weather. But you can go to any country on earth and hear the same story. Ireland has been in crisis for years on this metric. And at the other end of the earth, New Zealand complains of exactly the same thing: More than 1 million New Zealanders live abroad—the equivalent of losing a city the size of Auckland.
Putting aside the headlines, the facts are these:
• We increasingly inhabit a flatter earth where many companies have become global, and many others are born global or able to prosper only as international businesses.
• Talented people have always been mobile and naturally gravitate to the location where they will receive the best treatment in terms of compensation, lifestyle, or both.
• All countries benefit substantially from the arrival of foreign executives to balance the departure of homegrown talent.
• If an executive wants to rise up the career ladder today, international experience is a distinct advantage.
Despite the willingness of talent to relocate, such is the demand for the very best people that the notion of a domestic market is increasingly becoming a quaint memory. Companies are engaged in a global skills grab for the best people, positioning themselves to take advantage of the countries producing the best talent.
The hunt is on to find executives who are able to straddle different ethnic and corporate cultures and lead a workforce that spans five generations of people with widely diverging priorities and values. These executives may be based anywhere in the world.
The search is particularly intense in Asia-Pacific where, for the most part, young talent is still on the rise. By comparison, workforces in the West are mainly shrinking as the population ages and retires. The West also is starting to realize how much it has to learn from the attitudes and approaches of the East. When we chatted with Infosys (INFY) co-founder Nandan Nilekani recently, he told us that he frequently brings large groups of Western-trained executives to India to imbue them with the corporate culture before sending them back into offshore markets.
We are on the cusp of seeing large numbers of Asian executives hailed as among the world's best leaders. Indeed, many are already there—executives of the caliber of Mary Ma, the former chief financial officer who helped Lenovo integrate its acquisition of IBM's personal computer division and who now sits on the board of the Texas Pacific Group.
At the same time, multinationals are still cherry-picking the best Western talent to build their teams in Asia. Mumbai-based India Infoline (IIFL.BO) recently invested more than $10 million in sign-on bonuses to secure four executives from France's Credit Lyonnais to help set up its investment banking division.
Recognizing this need for businesses to identify seams of talent in different parts of the world, Heidrick & Struggles (HSII), of which I am the chief executive, has published two research projects in partnership with the Economist Intelligence Unit, exploring the talent development capability of different countries in Asia-Pacific and the Middle East over the next five years. These studies take a deep dive into the country-by-country detail, building on the Global Talent Index of 30 countries that we published in 2007.
The Asia-Pacific Talent Index predicts that by 2012 Singapore will jump into first place on the ranking, knocking Australia out of the top spot. This is in part the result of improvements in the quality of its compulsory education system. Overall, the research concludes that established talent pools are under threat from the regional giants India and China, but especially China. In many nondemographic measures China is already approaching levels seen in industrialized countries; and with its natural demographic advantage, fast improvement is expected by 2012.
The high volume of young citizens and subjects in the Middle East (current figures suggest 65% of the region's population are under the age of 25) points to an extended period of exceptional tax gains enabling the region to maintain an equilibrium between its working and nonworking populations that will make it the envy of aging countries such as Japan and Germany.
The insights from the research help companies plan for a future when there will be no "head office" in a "domestic market" but where every company will be competing globally for the same scarce talent resources. Today's global executives should not preoccupy themselves with the brain drain in their local market. Instead they must celebrate cultural differences, thrive on the complexity of managing diverse teams, and develop a keen eye for finding and nurturing emerging talent, wherever it might happen to be.
(To learn more about the Heidrick & Struggles Global Talent Index series that includes the recently published Asia-Pacific Talent Index and Middle East Talent Index, please visit www.weknowglobaltalent.com.)