Non-traditional and low-maturity industries offer more flexibility to exploit growth opportunities compared to mature industries
Talent preferences are shifting. There are several news reports and market research studies that clearly indicate that the reasons why a candidate chooses an employer have changed quite a lot in the last one to two years. For example, a survey report released by Nielsen in March 2014 among business school talent states that start-ups and e-commerce firms are fast becoming the most preferred employer choices for talent as opposed to traditional industries such as consulting and FMCG.
In fact, the same report states that investment banking, which was considered traditionally as among the most prolific employment industries, has moved down to the 10th spot among business school employer preferences. Manufacturing, software and IT services also fall behind others in terms of employment preferences in the Indian talent pool. The changing nature of the job market is unmistakable, and it is important for mature employers to ponder over why these changes are happening and what they can do to attract top talent. It is a wake-up call for traditional employers and they have to adjust and adapt quickly to stay competitive in the talent market.
Fast-paced growth opportunities are the key
Growth opportunity holds a critical and central element of talent attraction for traditional employers. A June 2014 study released by Hay Group and Canaan Partners indicates that growth opportunities are one of the central reasons why the talent market is preferring jobs in start-ups. The new generation of the workforce has a bigger risk appetite and are more technologically savvy. Besides that, their inherent aptitude for collaborative work allows them to pool insights and resources in non-traditional ways to execute work. Due to this, top talent in the market is looking for jobs which offer them early-development and fast-paced growth opportunities.
Non-traditional and low-maturity industries offer more flexibility to exploit growth opportunities compared to mature industries. Entrepreneurship and intrapreneurship have become buzzwords and candidates value these more in the present-day job market compared to job stability. As a result, the talent market is on the lookout for employer brands that offer ownership, opportunity, and entrepreneurship experiences. Traditional and mature employers need to remodel their working culture and career paths to accommodate this key trend.
Change the nature of learning
Traditional learning methodologies are proving ineffective in the face of new learning methodologies and techniques, which offer bigger and more inclusive learning opportunities for the talent market. Next generation talent prefers learning techniques which are more immersive, dynamic, and technology-driven. Traditional industries have to quickly act on the trends to keep pace with this fast-changing learning landscape. Rahul Khanna, Managing Director, Canaan Partners says, “Most start-ups use a combination of two to three training methods. The most widely used methods include internal training programmes, mentoring, and on-the-job training.” Mature employers have to stop relying on traditional learning methods and create systems and processes that cater to the needs of the new workforce generations. Social learning, mobile-enabled learning, and pervasive learning systems are investments that look worthwhile for mature employers.
Remodel compensation structures
Indian employers can no longer rely heavily on their product brands as an extension of their employer brands. Expectations from compensation are changing and consequently, preferred employers are changing their compensation models and compensation structures to attract talent. Debabrat Mishra, Director at Hay Group India says, “Indian start-ups are good paymasters with 82 per cent start-ups paying above the market median, which is a promising sign for the ecosystem.”
Flexible compensation models that offer a mix of fixed annual compensation, benefits and short-term and long-term incentives are preferred more over traditional fixed compensation models. Mature employers need to take a closer look at their present compensation models to attract top talent. While this may differ across generations and organisational hierarchy, preference for ESOPs, health and insurance benefits, and incentive structures are common. In the coming months, it will be interesting to track how the developments in the talent ecosystem impact traditional mature industries and how they adjust their hiring and branding strategy to stay competitive in the job market.