· 2 min read · Features

HR's role in emerging markets

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While some Western economies are showing nascent signs of growth following the global economic crisis, for multinational companies this good news is only one small piece of a much larger picture.

The economic landscape will always change and it is imperative that global organisations have a talent system in place that is robust and reactive enough to take advantage of shifts in global economies.

Rampant growth will test the mettle of even the best talent management strategy. As many HR professionals know, working in an economy that is growing extremely quickly will mean HR finds itself running to keep up as it battles to recruit talented staff.

In this situation, HR often expends too much focus on recruitment and retention, at the cost of more sustainable and strategic talent activities.

Talent management is key

Talent management in a stagnant economy has a different focus and emphasis to that in a growing economy of course, but there still needs to be a clear strategy and end objectives.

The plan must be flexible as the pace of change continues to increase. Multinational corporations are already looking towards markets such as Vietnam and Malaysia to provide the next accelerated growth opportunity. To take advantage of this they must be agile and able to respond quickly to changing circumstances.

The recent move towards reshoring certain industries, particularly manufacturing, is another piece of evidence that the global situation is fluid, almost regardless of top line economic performance. HR, like the business as a whole, must be agile enough to be able to respond to an organisation’s changing demands. 

A global workforce is a huge competitive advantage for international businesses, but it can’t be fully leveraged unless the brightest are found, seen and used. It is important to develop the kind of HR and talent systems that will support them as they break into new markets and those markets change and mature.

This is not just about structural processes and organisational design; it's about ensuring the best people the business has are able to move freely within it, across boundaries and borders. 

Decentralise the function

To achieve this is both the challenge and the opportunity. Rather than dictating everything from global HQ, HR does better to allow countries enough flexibility to work in the way that will give them the results that fit consistently with the overall HR strategy of the organisation.

This flexibility can be a difficult balance to strike; enough room must be allowed for local markets and regions to adopt tactics that best meet their needs, but these ideally need to fit into a broader talent management process.  

Meeting this challenge will fuel one of the greatest benefits of a global talent strategy; the controlled movement of people around the business, regardless of where they started. This is only possible with some degree of commonality across the talent function.

Organisations, especially those operating across multiple borders and moving into new territories, must acknowledge that global leaders do not spontaneously appear. Those with potential must be given the skills they need (for example, working with cross-cultural teams). 

Whether in a well-established or emerging economy, the strategic HR function has an important role to play in helping achieve the business strategy. Doing business in a global environment requires all areas to be agile and fleet of foot – HR is no exception.

By moving beyond partnership to become an anticipator of a company’s talent management needs, HR can really step up its contribution and become a more highly regarded part of the global organisation. 

Simon Mitchell is the UK general manager and global marketing director at talent management consultants DDI