Managing Talent in Two Leading Companies in Malaysia

Syed Jamal Syed Abd Nasir, Roshidi Hassan, Roslani Embi, and Abdul Khabir Rahmat

Faculty of Business Management, Universiti Teknologi MARA, 40450 Shah Alam, Malaysia

Syedjamal145@salam.uitm.edu.my

Keywords: Talent management, Selection, Recruitment, Development, Performance Deployment and Retention.

Abstract. This study qualitatively examines managing talent in two leading companies in Malaysia. The objectives of the study are to understand the practice of talent management , to examine the definition of talent management, to identify the approaches of talent management applied by the companies, to determine the differences of talent management approaches, to identify the problems in managing talent in the companies and lastly to identify the effectiveness of the talent management practiced by these companies. In depth interview with the relevant personnels were being conducted and transcribed verbatim.Constant comparative analysis technique of data analysis was employed in analysing the data. The study found that all the companies have started embarking on talent management programs due to the internal and external business pressure. However, each company was discovered to have different philosophy and approach in managing, developing and retaining their talent. This paper also discusses the challenges faced by companies in managing their talent and also some suggestions for improvement.

1. Introduction Although a review of literatures show that talent management is a growing field, the effectiveness of talent management and its added value have not been investigated in great depth. Moreover, research exploring relationship between talent management strategies and companies performance is still lacking and the question on the right strategy for the right impact on companies performance has not yet been answered [1]. In addition, many of the present research are confined to the United States, raising the question concerning the extent to which talent management influences companies performance in the other labour market structure and culture [2][3]. In Malaysia, talent management concepts and practices are still at the infancy stage and mostly companies that are well established such as the GLCs, MNCs and big companies have embarked on such talent management programs. For this research, researcher decided to choose the GLCs as the unit of study. It is deemed important to investigate how selected government linked companies (GLCs) in Malaysia deals with talent management process and issues such as approach of talent management, obstacles, differences in practice between different size of companies and the effectiveness of the practice because no study have attempted to explore the area in great depth.

It is deemed important to investigate how these two companies in Malaysia deals with talent management process and issues such as approach of talent management, obstacles, differences in practice between different size of companies and the effectiveness of the practice. Therefore, in order to explore talent management practice in these two companies, there are several question might help in this research: 1. How the company define talent and talent management; 2. what are the propositions for attracting and retaining talent; 3. How do they manage and use the talent that the organizations need, how are internal roles and resources deploy appropriately to support talent

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management, how talent management integrated across HR processes and with business planning and the strategy execution processes and how will talent management be integrated with existing performance management, development, succession planning, reward and recognition and other HR processes.

Research Objectives To understand the practise of talent management in these two companies, researchers seek to:1. To examine the definition of talent management among selected GLCs, 2. To identify the approaches of talent management applied by the companies, 3. To determine the differences of talent management approaches between different size of companies,4. To identify the problems in managing talent in the companies, 5. To identify the effectiveness of the talent management practiced by the companies, and 6. To identify the importance of talent management in building a high performance and competitive workplace among selected GLCs.

2. Research Method An exploratory study was carried out since there are a few related researches that have been conducted in Malaysia pertaining to talent management practices in organization. Exploratory research was employed two leading companies to gain further clarification on the subject as there is a lack of clarity which needs further investigation. Exploratory research helps to determine the best research design, data collection method and selection of subjects. In cases where such a research is explored the problem is usually has not been identified and not so much information is at hand for similar research done before hand. An in-depth interview was conducted with six HR managers of GLCs to get an insight on how the talent management are being practiced. Research questions were developed to guide the researchers during the in-depth interview. A cross sectional study was conducted within the period of twelve months.

2.1 Data Collection Method For this purpose of study the researchers used both primary and secondary sources. The primary data was obtained from the in-depth interview. The researchers have sent letter seeking for interview appointment with these two companies from telecommunication and plantation. Structured interview questions were prepared. Questions were being distributed to the informant earlier before the interview session was conducted. This is to allow the informant to be prepared and able to provide maximum information related to the topic. Each interview took approximately between one to two hours in length and conducted in English at the organization premises. All the interview sessions were being audio recorded. Apart from the information obtained from the interview, interviewers were also provided with other sources of information such as brochures and copy of power point slides related to talent management.

3. Data Analysis and Findings Interviews responses were transcribed verbatim and resent back to informant for the purpose of verification. This is to enhance the validity of information given. After receiving copy of verified data, researcher began to analyses the data by using constant comparative analysis [4]. This method requires the researcher to take one piece of data (E.g. one interview, one statement or one theme) and compare it to all other pieces of data that are either similar or different. During this process, the researcher begins to look at what makes this piece of data different and/or similar to other pieces of data. To conceal the identity of the identified companies, researcher decided to use alphabets to represent the respective companies. This is to uphold confidentiality of companies.

3.1 Talent Management Practice in Company A Company A is a leading telecommunication company in Malaysia offering wide range of

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telecommunication services and solutions. It has approximately 26,000 employees group wide both locally and abroad. The talent management initiative started in 1998 and becoming more important to the company ever since. The company intends to be the leader in telecommunication industry in the region and sees that there is a need to develop and managed their internal talent. Company A defined talent management as a process of developing, grooming, and maintaining internal employees to become future leaders of the company.

The idea of implementing talent management in this company is initiated by the top management. They feel the needs for company to implement such program in order to cope with the business challenges and competition among global companies which requires more sophisticated talent, new skills and expertise at all level in the organization. Secondly, is to identify and develop future leaders for the company internally. Thirdly’, is to help the company gain competitive advantage and finally to induce better performance achievement and business results. Mr. Aziz (not actual name) says “The purpose of talent is to cope with the business challenge and competition among global companies which requires more sophisticated talent, new skills, and expertise at all level in the organization, to identify and develop future leaders for the company, to help company gain competitive advantage, to induce better performance achievement and business results.”

Talents were identified after they have been with the company for at least three years. During this time, employees are being assessed in terms of their performance and potentials. The period of three years is given which the company consider ample for them to make good assessment and judgment about employee’s performance and potentials and for selecting the suitable candidate for talent development program. Mr. Aziz emphasize that “ Because I think we look at the 3 years is enough for them to actually get the level program purpose, to have the ample time to actually what to show they can do.”

The nomination of the so called ‘talent’ is based on the employee’s performance appraisal report made by the supervisor or through recommendations by heads of department. Usually, those employees that manage to scored more than level 4 (from the scale of 1 to 4) are recommended for the talent development program. The management feels that these employees have high leadership potentials that can be groomed to be successful leaders of the company. Those employees selected to be in the talent development program are given a more structured training and development program to prepare them with necessary skills and knowledge for leadership position in the company. These employees must also free from any disciplinary problems. Unlike for those employees who scored less than level four they are given a normal training program to enhance their current job performance.

Once they are in the talent pool they will be further observed and assessed with regard to their performance during the period. They are not guaranteed to stay on in the program if their performance fails to achieve the expected level of performance set by talent management team, under Transformation and Development Division. For those who are successful they will be given further exposure leadership development programs.  

Talent Development Programs/ Interventions. Company A has made various improvements in ensuring the effectiveness of its talent management program. Employees in the program are given the opportunity to pursue Post Graduate study, especially Master Business Administration (MBA) to expose them with appropriate business and management knowledge. Under redeployment and job rotation program, the company relocates identified talent to hold new strategic position for a maximum period of three years. According to Mr Aziz”… we look at three years is enough for them actually get the level program purpose. Three years is sufficient to actually give chance to actually show what they can do. “ . The talent management team provides exposure for employees to participate in local and international leadership talk, forum, and seminars organized by leading management business schools such as Harvard Business School. In addition, 50% of the nominated names are of those involved in the talent pool program. This special privilege is considered as one of the company major initiative to retain valuable talent to elevate the company to greater heights in

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the telecommunication industries.

3.2 Talent Management in Company B Company B is a Malaysian leading multinational conglomerate involve in five core sectors which include plantation, property, heavy equipment, motor vehicle, energy and utilities. It has workforce of more than 100,000 employees. From a single company offering a single product and services in one country, it is now becoming one of South East Asian largest conglomerates with some 25,000 employees in a wide range of business activities in approximately twenty countries. The company has in place a wide spectrum of talent management programs and systems ranging from traditional learning and development programs provided by the HRD Centre to innovative practices like individual and team based action learning programs, on the job learning, coaching/mentoring, and international rotational job assignments.  

Definition of Talent Management. Company B defines talent management as attracting, developing, motivating and engaging talent towards becoming outstanding professionals and well-rounded international executives. It’s about managing the human capital. All employees are being considered as talent. The purpose of adapting talent management is to assist the company growth and to achieve its strategic goals and objectives. The company also stated that is for company future survival. With talent management Company B expect that it could help company to face future global challenges. The purpose extends to the ability of developing the right people and to drive the business in a longer term. It is to ensure leadership and business continuity. Mr. Budin says “we need a steady line of people that they were to succeed in order to position in a role, if there someone leaves then there will be business continuity and sustainability”  

Key Success Factors. Management support is a key success factor in managing talent in Company B. They take the division’s opinion into account in designing talent management programs. The divisions are encouraged to be involved in designing, developing and providing input to ensure the program success. Company B believed that the talent management process needs to be structured and organized. They are trying to put in the proper process, governance, structure and technology so that it is institutionalized in the company. Therefore, the process of talent management can continue regardless of who runs the company.

Company B performs regular assessment to identify who among their talent are the top talent. There are three steps to identify the top talent. The top talent is the top five per cent of the overall company talent pool. The top talents are those with high capabilities, high potentials, and high performance. The initial 20 % will go through the potential and performance assessment before their numbers is trimmed down to 5% for the entire levels. For critical position in the company, they established a success profile, which are the competencies, experience, skill, knowledge that make the person competent in the job. Those among the top 5% who matches this profile will be recommended for the top talent pool or succession planning pool. For those identified as top talents, their development is track closely. They will be given various tasks during the three years observation period to perform and which their performance will be further assessed.  

Talent Management Training and Development Programs. Company B talent management training and development program includes Job Rotation, coaching and role enhancement. Talents were rotated in term of their functions in exposing to new tasks in acquiring new skills. They were also trained by coach who responsible to develop them and their role also has been enhanced in training them to acquire new knowledge and skills.

4. Conclusions and Recommendations Both companies perceived talent management as an important driver for company growth and source of competitive advantage. However talent management practice is still at early stage of

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development which requires further understanding on the concept. The documentation of talent management practice is still not well established, and both of the organizations indicate on improving the talent management system. Both companies give emphasis on getting the right talent at early stage. Based on the findings it is recommended that they have to provide training and exposure to the talent. Base on similar model there are different approach based on the needs of organization.

Basically the talent management program and practice in these companies is being guided by Malaysian government investment holding arm which is Khazanah Nasional orange book. Challenge: take the challenge part and effectiveness. The overall talent management programs implemented in GLCs are successful in producing high performance achievement. It can be seen in the positive turnover in revenue and marketability of employee. This paper should aid managers in engaging with some issues they face with regards to talent management.

Both companies perceived talent management as an important driver for company growth and source of competitive advantage. Talent management practice is still at an early stage of development which requires further understanding on the concept. The practice of talent management practice is still not well documented in most interviewed organizations, and most of the organizations have a mixed understanding between succession planning and talent management. Both companies give emphasis on getting the right talent at the early stage i.e. recruitment stage.

The companies still have unclear understanding about talent and talented employees as some considered all employees as talent whereas the others considered only high performance employees as talent. As a result they tend to adopt different approaches in managing talents even though they are all guided by the “Orange Book” provided by Khazanah Nasional. Lack of internal expertise in talent management has made some companies being too dependent on external consultant which resulted in the increase in cost. External consultant was engaged to develop the modules and talent management framework for the company besides monitoring the evaluation and implementation of talent management.

Even though the companies are able to control the turnover rate under industry average but they are still having problems in retaining the talent in the long run as the mechanism to maintain and retain the talent has not been very competitive especially competing with the global players. The overall talent management programs implemented in GLCs are successful in developing high performance employees. It can be justified by the positive turnover in revenues and marketability of the well-developed talent.

4.1 Recommendations Based on the study result, it is recommended for other both companies or other companies in Malaysia to adopt an effective talent management practices, as it has proven to bring positive results both to the employees and organization. Set up talent management unit or department to look into. They have to identify ways to overcome turnover among top talent, probably this both companies can benchmark successful companies that is very successful in retaining their talent. Train more experts to provide talent program, develop internal trainers, training the trainers. Provide equitable and attractive compensation and incentive for those who have been in talent management program to prevent them from leaving the company for better remuneration package and provide clear career path to successful talents.

4.2 Future Research To include more companies, instead of two companies but include all different culture. In term of identifying the different approach in managing talent. Look in depth into one single dimension of talent management, eg. recruitment, retention, performance metric of the effectiveness eg: ROI, satisfaction  Acknowledgments. We would like to thanks to Faculty of Business Management UiTM, Research Management Institute UiTM and Ministry of Higher Education Malaysia.

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Reference

[1] E. E. Lawler, "Reinventing HR," Talent Management, vol. 4, no. 9, pp. 22-25 (2008).

[2] I. Tarique and R. Schuler, "Global Talent Management: Literature review, integrative framework, and suggestions for further research," Journal of World Business, vol. 45, pp. 122-133, (2010)

[3] McKinsey and Company., " War for Talent.," (2001)

[4] M. Q. Patton, Qualitative Evaluation and Research Methods 2nd Ed., Newbury Park, CA: Sage Publications Inc. (1990)

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