These days, it is so common for organisations to not to have enough sufficiently skilled people in the right place at the right time. Therefore, many agree that the skills crisis is deepening, and is preventing business leaders from driving the organisation forward.

Ms. Lancy Chui, Managing Director of Manpower Group Hong Kong, Macau & Vietnam operations.

According to a CEO Survey, one in four CEOs said they were unable to pursue a market opportunity or have had to cancel or delay a strategic initiative because of talent challenges, whilst one in three is concerned that skills shortages will impact their company's ability to innovate effectively.i

The burgeoning marketplace urges organisations to seek talent with more
specific skills set or combinations of skills and qualities. However, the skills that organisations look for may not actually match up with those that are readily available in the job market. In the meantime, members of the current workforce may be under-skilled to meet the organisation's development needs. In other words, there are skills gaps and mismatches of talent within the workforce. What should be done to close those gaps and ensure that people are keeping pace with the organisation's development with the necessary knowledge, skills, and mindset?

Talent Scarcity: Why?
As a survey on talent shortage reveals, 42 percent of Hong Kong employers report difficulties filling positions. And employers in the Asia Pacific region cited sales representatives, technicians and laborers as the most difficult employees to find due to lack of available talent.ii

Commenting on the cause of the talent scarcity, Ms. Lancy Chui, Managing Director of Manpower Group Hong Kong, Macau & Vietnam operations says it is mainly because the world is entering the Human Age.

"As our CEO Mr. Jeffrey A. Joerres said, 'the Human Age will be an era of great transformation, radical changes and new developments, where business models will have to be redesigned, value propositions redefined and social systems reinvented'. There are four indicators of the Human Age that can tell why we are facing the
shortage of talent – demographics/ talent mismatch; individual choice; rise of customer sophistication and
technological revolutions."

Demographics/talent mismatch
Ms. Chui says, "Demographic change brings about the challenge of talent shortage as the working age population declines, for example, from 2011, 10,000 baby boomers will turn 65 every day for the next 19 years, which means the availability of skilled individuals will shrink. Besides, as more emerging markets are moving to developed status, the demand for skilled individuals will further increases, which will definitely intensify the war for talent."

Individual choice
"The world is shifting from Capitalism to Talentism, so we will see power and choice shifting firmly towards the talented individual. In other words, individual choice is becoming increasingly important and is eliminating the one-size-fitsall approach. Since each generation approaches work differently, the onesize-fits-all approach is no longer workable. To unleash the potential of talent, HR managers need to understand each talent's preference and need and engage with them on a human level," she continues.

Rise of customer sophistication
In today's inter-connected world, customers have more access to information, experts and lower cost channels. They know more and expect more. This increases the pressure on organisations to deliver greater value and thus organisations need more talented individuals to deliver the value.

Technology revolution
As Ms. Chui told, technology is transforming the way we interact, live and work. It also enables skilled individuals to vault the restrictions of national borders and have greater choice of where, when and how to get work done.

Industry Watch: Retail
When it comes to talent scarcity, many would think of the retail industry as it is known for the rapid turnover rate and inadequate replacements. Ms. Caroline Mak, Chairman, Hong Kong Retail Management Association (HKRMA) believes that the problem of talent scarcity has become more severe after the implementation of the Minimum Wage Ordinance (MWO).

"The around 4,000 outsourced staff of the Government are paid for rest days, resulted in increased salaries. This has affected the job vacancies outside where rest days are not paid. Talent scarcity is a problem across industries, but there are some lowwage positions that are particularly hard to fill in the retail industry, such as security guards, warehouse staff or dustmen. It is because working people now prefer taking up positions that are less strenuous," she explains.

Frontline: the Hardest to Fill

Ms. Caroline Mak, Chairman, Hong Kong Retail Management Association (HKRMA).

Looking into the latest situation of manpower shortage, in particular in frontline, managerial and backend positions of the retail industry, HKRMA conducted a survey on manpower shortage in January 2012.

According to the survey, among 63 companies (with 4,571 outlets and 89,513 employees) in the retail industry, the total vacancy rate of both full-time and part-time positions is 8.8 percent. Out of 7,910 total vacancies, 90.8 percent (7,182) was recorded in frontline positions.iii

"Frontline positions are the hardest to fill with a very fast turnover. As our survey reveals, among the various frontline positions, sales staff recorded the highest vacancies which represented 51 percent of total vacancies. And out of this 51 percent, sales persons in 'Supermarkets & Convenience Stores' category registered the highest vacancy rate at 23 percent," Ms. Mak continues.

Attract New Blood
Ms. Mak holds that talent scarcity is a structural problem in the working population. It stems from a number of factors, for example the decrease of workforce due to lower birth rate, misalignment between technical training and business needs, the retirement of older blue-collar workers without adequate replacements, and the preference of young workers for higher status knowledge work to more manual forms of work.

"The situation is understandable as most parents hope their children to have a brighter future. Besides, the younger generation has better education, so most youngsters nowadays prefer not to be bluecollar workers. Another reason is that many job seekers do not understand the prospects of starting a career in the retail business, which may hinder them from entering the industry."

"To promote positive attitudes towards working in retail, HKRMA strives to help the working population understand the career and compensation potential of the industry. "I think industry practitioners, employers and the Government should work together in order to change people's mindset to retail jobs," she adds.

The Qualification Framework
Since 2004, HKRMA has been in cooperation with the Education Bureau (EDB) for the Qualification Framework (QF), a seven-level cross-sectoral framework and its associated quality assurance mechanism to clearly define the standards of different qualifications, ensure their quality and indicate the articulation ladders between different levels of qualifications. A Retail Industry Training Advisory Committee was also set up in 2010 with Ms. Mak as the chairman to develop the Specification of Competency Standards (SCSs) for the industry, with the aim to set out the competency standards required at different levels under the QF.

"The QF allows working people in the retail industry to assess their competencies to see which level they can reach. Hence, we now have a common industry standard and workers can see a clearer career path. We hope that this will create some positive impact and encourage more youngsters to begin their careers in the retail industry," says Ms. Mak.

Ms. Mak believes that talent scarcity will continue in the retail business as more new international brands and shops are entering Hong Kong market, which means more staff will be recruited. "Strong sales volume and the increasing number of shops opened contribute to the greater demand for talent. On the other hand, the large customer volume and customers' higher expectation for service quality pushes for more manpower in one shop. All these factors intensify the competition for talent."

Industry Watch: IT
The IT sector is another industry hit hard by the skills crisis. Ms. Fanny Wong, Senior Manager, Human Resources, Jardine OneSolution (HK) Ltd points out that the IT industry is facing a wave of talent challenges, among which recruiting and retaining is the toughest.

Hard to Recruit and Retain
"Like other industries, the IT industry is also short of talent. It is mainly because there was once a period of time when younger talent didn't want to study IT and thus reduced the number of IT graduates. This has created a split in the industry where the source of talent with 8-10 years of work experience is very limited," she says.

Apart from the lack of experienced workers, the high turnover rate in the industry raises HR's concern for talent retention. "It's common for IT people to work long hours. In the old days it wasn't really a problem as people didn't mind working overtime. However, as today's young workers put more emphasis on work/life balance, long-hour work discourages them from taking up IT positions, which require shift duty or standby duty."

Adjust HR Strategy

Ms. Fanny Wong, Senior Manager, Human Resources, Jardine OneSolution (HK) Ltd.

To address the talent challenge, JOS, the integrated IT solutions provider has adjusted some of its HR strategies, as Ms. Wong told. "For example, for some positions that require shift work, we provide incentives to reward our staff and increase manpower resources to suit the shift or standby working pattern. We also provide sponsorship for staff to acquire new knowledge and skills, such as taking exams for professional qualifications, whilst staff may also choose to attend training delivered by external trainers to assist the staff to learn the new IT skills around us. With these practices in place, we hope that our staff will be motivated and be more engaged in their work."

In the near future, Ms. Wong expects that the industry still will be facing challenges in talent management. "We can see there is real difficulty in finding talent and skills in the job market, especially for experienced staff in the areas of sales and marketing, network and server, etc. To tackle this problem, organisations should upskill their existing staff with training and development to build their own talent pool, in addition to seeking talent outside," Ms. Wong suggests.

Thirst for Service-savvy Talent
Speaking of the trend in the IT industry, Mr. William Lam Wai-hung, Director of Knowledge and Web Management, itSMF Hong Kong Chapter, says the industry, with the rise of cloud computing, is undergoing rapid development towards a services orientation.

"In the past, when we talk about IT, people will only think of data centres, hardware, and programmes. They think that everything is technical but it's no longer the case. Now, the industry provides integrated services to clients who have higher expectations and requirements. There is no longer clear division between

"Today's IT people, besides possessing technical skills, also need to be able to serve clients. Large corporations are now looking for talent with skills and knowledge not limited to professional and technical skills, but also sales and marketing, and business management. For example, customer services staff also needs to have IT knowledge whilst IT technicians also need to grasp the concept of service management."

Some organisations i n the industry, as Mr. Lam reveals, create new positions such as capacity managers, configuration managers and change managers in response to the new trend. The positions have the responsibilities to ensure that services are delivered and supported by bestpractice processes. These organisations are craving for IT talent who masters knowledge in multiple disciplines and thinks from a client's perspective.

New Skills on Demand
The growing popularity of smartphones and social media urges organisations to find out more talent with new skills and expertise, which leads to a more severe talent shortage in the industry.

"The industry now has a craving for talent who possesses new skills and expertise in IT support, apps writing, mobile computing and social media. Some companies create new positions for these jobs, whilst some may not hire new talent but find contractors to take up the tasks instead."

International Qualifications

Mr. William Lam Wai-hung, Director of Knowledge and Web Management, itSMF Hong Kong Chapter.

Mr. Lam also points out that these days more organisations in the industry prefer recruiting IT people with qualifications, such as the IT Infrastructure Library certification (ITIL). “The trend reflects that IT people not only need to have professional knowledge, but also IT service management skills. From an HR perspective, the ITIL certification offers a common standard for recruiting IT service talent, which is helpful in the management of IT talent."

To sum up, Mr. Lam says, "The IT world is going more global so the employment market for IT talent is competitive in every corner in the world. Despite the growth of the IT market in Mainland China, Hong Kong still possesses its advantage in IT service management. I would predict that the demand for service management talent will be even greater in the coming quarters, so the problem of talent scarcity will probably continue."

Conquer the Crisis: What to do?
Given the wave of challenges derived from the skills crisis, what should HR and business leaders do in order to close the skills gaps, retain the talented and maintain the organisation's winning edge?

- Teachable fit
Ms. Chui introduces the concept of "Teachable Fit" and says, "The speed of change between generations will accelerate, and we can expect to see a greater shortage of talent as the active working age will very soon go beyond
65 whilst talented youth may decrease due to lower birth rate, therefore it brooks no delay for HR and business leaders to arm themselves with the ability to identify a 'teachable fit', which is the key to easing the problem of skills gaps and talent mismatch."

As Ms. Chui explains, the concept of "teachable fit" focuses on four questions:

1. What capabilities are essential to performing the job?
2. Which of these are teachable in an efficient way?
3. Is there adequate time and money to develop these capabilities in the candidate?
4. And do candidates have the capacity (both motivation and capability) to develop them?

"In spite of the shortage of talent, it is important for organisations to build a sustainable talent pipeline in order to thrive in today's competitive marketplace. The concept of 'teachable fit' focuses on increasing the supply of talent by changing the employer's mindset regarding sources of available talent. In fact, as the technology evolves, organisations today can tap previously invisible and inaccessible pools of talent in the form of virtual workforces via the connective power of the Internet and social networks."

To fill skills gaps, there are four potential labour pools that are promising for finding talent that is a "teachable fit":

1. Location migrants
"These talented individuals are willing to relocate for work. As the global workforce is getting more mobile, HR managers may consider looking elsewhere if the talent is not in your geographical location," says Ms. Chui.

2. Industry migrants
"Industry migrants are those who possess transferable skills - skills that can be transferred to new industries. Some industries might have a surplus of talent, and these workers could have the capacity to fit your needs. If you can't find talent within your own industry, consider looking in an adjacent one."

3. Internal role changes
"It is not always feasible to seek talent outside, especially in times where the job market is seriously short of talent. Therefore, organisations should also consider developing talent from within. Assessing your internal talent pool and finding candidates who are a 'teachable fit' can not only save you recruiting cost, but boost employee engagement across your organisation."

4. Workforce entrants
"HR managers are suggested to look outside the regular workforce and turn to the untapped talent pools including underemployed, underskilled and underrepresented groups (such as older workers, younger workers or housewives). These candidates can benefit from training and other programmes designed to enable their transition into the
workforce."

• Reskilling and upskilling
In view of the growing problem of talent mismatch in organisations, Ms. Chui highlights the importance of having a commitment to reskilling and upskilling, which will greatly narrow skills gaps within the workforce and enable organisations to expand the available pools of talent.

• Staff motivation
Staff motivation is another issue of concern. Organisations should invest more in motivating the talented individuals to prevent talent loss in the existing workforce. Ms. Chui adds, "With the growth of technology and social media, the working environment today is more transparent and has given us the ability to have human-to-human conversations easily. To earn your people's respect and loyalty, it is important that organisations can deliver articulated missions, visions and objectives; foster a clear corporate culture to build an employer's brand."

Act with Agility
In closing, Ms. Chui reminds that organisations need to be more openminded and have strong sensibility both culturally and generationally, so that they are able to adjust their mindset to ensure that they have the right workforce models and people practices in place to attract, retain and unleash the inner potential of their talent.

"In today's business world, organisations must be agile and flexible in the way they attract, retain and develop talent. Make sure you have the best environment and people strategy to unlock your talent's potential. This will help you beat the skills crisis and succeed in the Human Age," she concludes.

References:
i 15th Annual Global CEO Survey - "Delivering Results: Growth and Value in a Volatile World", by
PricewaterhouseCoopers.
ii Talent Shortage Survey 2011, by Manpower.
iii HKRMA Survey