How to Manage Talent in Fast-Moving Labor Markets: Some Findings from India

VILLANOVA, PA, 10 October 2008—For many organizations, the most intractable hindrance to growth faced by companies in India is employee retention. Villanova School of Business professors Jonathan Doh, Stephen Stumpf, and Walter Tymon have partnered with leading integrated consultancy firm, Right Management, to explore retention strategies in fast-moving labor markets; specifically, India.

“As more organizations expand their operations, the need for talent has sky-rocketed,” says Jonathan Doh, Associate Professor of Management & Operations and director of the Villanova School of Business Center for Global Leadership. “Organizations are now turning to research and both global and local best practices for retention tactics to apply in these fast moving labor markets.”

28 Indian companies and 4,811 employees participated in the research, representing five broad industry groupings: Business Process Outsourcing, Information Technology, Engineering and Manufacturing, Pharmaceuticals, and Banking and Financial Services. The study’s findings have uncovered a significant gap in basic management skills.

Respondents expressed dissatisfaction with their manager’s ability to provide constructive criticism and to lead teams effectively. The study pinpointed employee engagement as critical to retention and highlighted four key HR practices—performance management, professional development, manager support, and an organizational commitment to a larger social purpose—as playing a particularly crucial role. Simultaneously, employees who felt their companies offered clear prospects for immediate growth were more likely to indicate a willingness to remain at their current employer. Finally, the researchers found a strong correlation between retention and a positive assessment of a company’s performance management systems.

The Villanova School of Business has been at the forefront of business education since it was founded in 1922. Today, VSB is ranked the #13 business school in the nation by BusinessWeek, and serves over 2,500 undergraduate and graduate students in 7 business fields. The school offers an International Business co-major, which enables students to deepen their foreign language and global business competencies and to study abroad. The VSB study-abroad participation rate is nearly 50 percent among undergraduates, compared to a national average of 1 percent. The Center for Global Leadership at VSB is led by Jonathan Doh, the Herbert G. Ramrath Endowed Chair of International Business.

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