Human Resources Roles in Global Talent Management and Contextual Factors

This study was based on a research developed by Sparrow et al. [17] that expands the knowledge of the process of talent management on a global scale which explores a framework of human resource roles in global talent management designed by Farndale et al. [18].

Sparrow et al. [17] focus on the role of the HR function in facilitating the successful management of key talent across the organizations based on data from two large multinational firms based in the UK and the USA. A particular point of interest is how the HR roles may be changing in global talent management based on the global financial services crisis.

Therefore, Talent Management has become more critical than ever. According to Somaya and Williamson [19], some argue that given the large number of lay-offs as a result of the crisis, there is no longer the “war for talent,” popularized by McKinsey. However, organizations continue to seek the top, justifying the significant investment made in the most highly competent people [17].

Farndale et al. [18] developed a conceptual framework that extends beyond the specific global talent management strategies. They described four roles which may be adopted to facilitate global talent management in multinational organizations:

  • (a) Champion of processes: Developing and monitoring global talent management practices and policies, tools, and strategies; ensuring that these are implemented across the organizations; monitoring GTM processes; and improving coordination of tools, processes, and techniques across functions.
  • (b) Guardian of culture: Ensuring a mobility culture across the organization; incorporating values in organizations strategies and activities to support global mobility of individuals.
  • (c) Manager of internal receptivity : Encouraging the inflow and outflow of key talent across business entities; encouraging receiving units to manage diversity, careers, integration, and work-life balance.
  • (d) Network leadership and intelligence: Developing appropriate networks inside and outside the organization to support the GTM process; being aware of developments in the internal and external labor market; mobilizing appropriate talent both internally and through external provider and a sense of timing and context.

Sparrow et al.’s [17] biggest challenge was to test this framework empirically, to see how the roles, if present, are actually enacted, and to explore at what extent different organizational contexts impact on the framework: business model, talent philosophy, and international financial crisis.

According to the same authors, talent can be divided into two perspectives, focusing either on the subject, individuals with career management needs, or on the object, knowledge, or competencies that the organization needs to manage. Part of the distinction depends on whether people are seen as having innate abilities or whether everyone has strengths which can be developed to reach the top talent status. Talent management then differentiates between taking a generic or differential approach to the management of potential. Should an organization aim to develop everyone, adopting a very inclusive approach, allowing everyone to get the chance to rise to the top; or should development opportunities be offered exclusively to the best? Both approaches constitute talent management systems, but each requires a different implementation strategy.

According to Stahl et al. [16], an exclusive approach, centralizes the rewordings and the attention on the top talent. Otherwise, it assigns less recognition, rewordings, and development needs to the other employees. On the inclusive approach, organizations’ main concern is to try to develop and reward all the employees, on an equal way.

The two Talent Management philosophies can live together. Many companies combine them. Regarding specific talent pools (senior executives; specialized technicians; young talents), there could be different development strategies. A hybrid approach helps on the differentiation and overcomes the big controversy on the intrinsic value of some groups or functions.

Within the global talent management field, one factor differentiates it from “domestic” talent management which is global mobility or expatriation—the movement of key people to overseas locations of the organization [17]. Managing global mobility becomes a key part of the human resources strategy for global talent management. However, there is no single business capable for operating internationally, and there can be several variations in the roles of the HR function in different types of international organizations [17]. The distinction is made between organizations with more centralized operations compared to those which are more decentralized, with local operations able to decide their own approach to global talent management.

According to Farndale et al. [18], the centralized model requires high global integration, while the decentralized model requires local responsiveness. The general trend is toward increasing centralization in order to have some control on the development of the future leadership of the organizations.

Sparrow et al. [17] examined whether and how adjustments to the global integration and local responsiveness balance are being made in the financial and professional service firms. They also explored the extent to which the enactment of each of the HR roles is likely to depend on the contextual and strategic factors.

The first proposition relates to the need to build a core of competence able to transfer capability across multiple countries. In order to achieve this, the four roles are expected to be present.

The second proposition builds on the first. Although the four roles may be present, the authors anticipate the variation in the prevalence of these roles based on the context of the firms: inclusive or exclusive approach; centralized or decentralized business model; and the specific characteristics of the financial and professional service firm contexts.

The final proposition suggested that these four roles will be dynamic and the 2008 finance crisis is likely to have changed the global talent management Agenda and the supply of talent and reduced available resources for implementing global mobility strategies.

According to Nijveld [4], these four roles should be in good balance. The alignment between those roles leads to organizational performance. But the alignment between those roles is not the only alignment there should be. Internal alignment is the key for a positive relation between GTM and organizational performance.

Human resources area is a crucial competitive advantage source on the design of business strategy settled on three main issues: the belief on the potential of human development; the intention to value people on their workplace; and the reinforcement of leadership on the development of organizational culture [20].

According to Stahl et al. [16, p. 2], the competitive advantage in talent management does not come from implementing best practices, rather it comes from internal consistency of all the elements that constitute the talent management system, in other words, the way the talent management practices fit with each other.

Best practices as recruitment, staffing and succession planning, training and developing or retention management are not the key to competitive advantage, but they must align closely with the various elements of TM system, such as business strategy, leadership philosophy, and value system of the organization.

Schuler et al. [10] believe that the organizational culture in the form of business needs and strategies is also a main characteristic on the design of the talent management strategy. According to a literature review made by these authors, there are also many external contingencies that influence global talent management: economic trends, competitiveness, labor market conditions, and national culture.

Talent management globalization requires a specific approach that considers additional international pressures. In the current economic climate, it may no longer be appropriate to talk about a “war for talent.” This expression was replaced by “demand for talent” as a result of two big challenges: local competitiveness and the new forms of mobility related to the emergent markets. More people available on the labor market does not necessarily mean that employers are able to find the level of skilled professionals they are seeking. The demand for talent remains high and it stills remaining a lack of talent, especially on the high technology field in the emergent markets. There is also a high talent competitiveness beyond expatriates and local workers [21, 22].

Farndale et al. [18] believe that the quickest step to internationalization and globalization involves a strategic role of the human resources area. An effective talent management system allows the multinational companies to reach a global competitive advantage [10].

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