AS AUSTRALIAN employers experience the same skills shortage as their counterparts in the United States and other Western economies, employers are only now starting to realise that they should be concentrating more on maximising returns from their human asset base
AS AUSTRALIAN employers experience the same skills shortage as their counterparts in the United States and other Western economies, employers are only now starting to realise that they should be concentrating more on maximising returns from their human asset base.
In a recent visit to Australia, Louis Tetu, chairman and CEO of global enterprise staffing management and workforce logistics firm Taleo, also noted that Australian employers are also facing the same challenges such as high-levels of employee turnover, general employee dissatisfaction and inexact recruitment drives that often result in bad hires.
Considering the fact that most businesses’ largest expense is the cost of labour, he said it was critical that these challenges be meet in order to drive this cost down and boost organisational productivity at the same time.
He said the biggest savings were to be found in reducing the likelihood of bad hires, ensuring employees were satisfied and motivated enough to contribute to organisational productivity, minimising recruitment costs and maximising employee retention rates.
“Many companies start looking at talent turnover as not only the direct cost of turnover, but every time talent leaves the company there’s also a loss of goodwill and intellectual property,” Tetu said.
Taleo estimates that 17 to 20 per cent of an employer’s labour cost is a result of the transfer of intellectual property from their organisation to a competitors when a star employee leaves. This is in addition to the cost of re-engaging the recruitment process, training a new employee and then allowing for the unproductive time necessary for the new recruit to become immersed in the company’s culture and processes.
He also said that many multinationals such as Hewlett Packard, Procter & Gamble Dow Chemical and General Motors were refining their talent management strategies in the face of an ever-worsening skills shortage.
“These companies look at how they can optimise the deployment of talent globally, better measuring performance and understanding the value of various types of talent all over the world in order to create a global talent pool,” Tetu said.
“What we see in the US is a major shift in HR leadership focusing on talent management – optimally assigning talent, managing their talent inventory more dynamically, pinpointing existing talent within their organisation and then redeploying that talent more effectively and proactively offering job opportunities as a means to fostering retention.”
