Talent Management at Hilti AG - Research Paper Example

? Talent Management Introduction to Organization The current organization under discussion is Hilti AG which develops, manufactures, markets and distributes tools used in the construction industry. Professional users such as builders, mechanics and other technical personnel use most tools developed by Hilti. Over the years Hilti has diversified its production and development lines to meet a number of different product portfolios. The major sectors dealt by Hilti include tools used in mining, drilling equipment, measurement tools, demolition equipment, grinding systems, cordless tools, cutting systems, various kinds of fastening systems, fire retardant systems, chemicals used in construction and others (Hilti, 2012). The current employment size of the organisation in over 20,000 people worldwide and the company is continuing to expand into newer markets. The company has come a long way from its humble origins in the early forties when it was founded in a small state in Europe. Currently Hilti operates in over 120 countries worldwide and tends to operate in one of the most competitive markets in the world (Hilti, 2009). In order to gain competitive advantage over its competitors Hilti has a continuous need for innovation that it tends to meet using talent management methods. The added pressures to make the workplace safer have meant that health and safety regulations have been changing around the world in the past few decades (Fung et al., 2010). In order to keep up with the challenge, Hilti has been employing a number of different talent management strategies that are discussed in detail below. 2. Talent Management Strategy Talent management has grown to encompass human resource management through the active anticipation of human resource requirements. These requirements are tabulated and plans are devised in order to meet the identified human resources needs (Carpenter, Bauer, & Erdogan, 2010). Generally businesses engaged in talent management transfer the grooming of employees from the human resources department to the line managers directly in order to produce more efficient strategies. It also tends to make more sense given that the line managers have far greater expertise in determining the needs and requirements of individual employees. These can be used to align the development of individuals with the developmental needs of the organization far more flexibly. The largest reason for the enhanced flexibility is the simplification of the overall framework that does not remove the human resources department but instead tends to simplify the process flow. Typically talent management programs can pursue either of two preferred paths in order to enhance the overall human resource potential. The simpler strategy is to hire talented individuals from the labor market and to manage them accordingly. Another alternative strategy is based on the assumption that all individuals carry some form of talent. This strategy relies on grooming the individual talents of all employees in order to garner human resources. Therefore, talent management in an organization could be diverted at a select few individuals or to the entire labor set in order to develop human resources to empower the organizational objectives and goals (Rammer et al., 2010) (Perdomo-Ortiz et al., 2009). While some organizations have chosen to pursue the former path over the latter but Hilti has chosen to use the latter path. The development of a few select individuals tends to lower the costs for talent management but exposes the business to greater risks. These risks arise when the talented and groomed individuals choose to leave the organization for any number of reasons. Above anything else, this could occur due to the “war for talent” (Michaels, Handfield-Jones, & Axelrod, 2001) where an organization decides to capture the available talent pool from the market by providing better pays and perks. The human resources that leave an organization in this scenario represent a large loss in both costs and time consumed. In contrast, the generalized approach to developing the entire talent pool is safer because it provides the organization with a steady supply of talent. Even if a few people leave the organization, there are always others who can take over their functions. This ensures more sustainability for an organization’s functions though the costs are greater because more people need to be invested in. Hilti has chosen to go with the generalized approach to talent management around the world. In order to support its program, Hilti has devised a number of methods that are discussed below. 2.1. Key Components 2.1.1. Identification of Talent Hilti uses a number of different criteria in order to identify the talents possessed by its human resource pool. Talent identification routines are carried out on fresh employees by their line managers who perform an appraisal every four months for identifying the particular talents possessed by an individual. Hilti provides its fresh workers with a flexible working environment and puts them in various positions to see how they perform. For example, a technical person such as an engineer would be placed in research and development, sales, manufacturing, warehousing etc. in order to provide him with early exposure. During this process of movement, the employee is appraised every four months by the respective line manager to delineate the personal focus of the employee. The line managers help to identify if the person has a focus for technical work or administrative functions. This identification routine is carried out for a full year with a total of three appraisals. The results from these appraisals are then used to groom the talent of the concerned employee to the preferred direction. 2.1.2. Assessment of Talent Hilti tends to assess its talent for a number of criteria simultaneously. The chief focus of Hilti’s assessment lies in measuring performance and potential. Employees have to answer for a number of different responsibilities in their work routines. The typical responsibilities that all employees need to be assessed for are safety, technical knowledge, attitude with supervisors, attitude with subordinates, personal initiative for development, team spirit, personal contacts etc. These multiple criteria are used to perform the four monthly assessments of employees which is then used for further personal development. 2.1.3. Development of Talent Once talent is identified in a particular employee, the employee is then informed of the results of his evaluation. The employee can choose to agree or disagree with the results of the evaluation. If the employee disagrees, he or she must justify the reasons for disagreeing on solid ground. Typically this does not occur and most employees tend to agree with the evaluation results. Once the talents are identified and the employee agrees to them, he or she is allowed to choose the particular line of work they want to progress in. For example, if an employee’s talents are identified as technical, the employee is allowed to choose if he wants to work for research and development, manufacturing, after sales support etc. The employee chooses his or her own area of development and is put on a track for development in the respectively chosen area. The employees are put through constant personal development, technical development, safety development and other such programs through courses and subsequent examinations at all levels. The employees are allowed to choose their own goals and objectives for a year and are required to assess their personal development at the year’s end. The line manager assesses other skills that are developed and future direction is set accordingly. Overall talent development is a dynamic and continuous process that requires continuous feedback for improvement and up gradation. This feedback arrives from both the employees and the line managers with the management being carried out by the human resources department. 3. Talent Management and Competitive Advantage Hilti operates in a market sector where competitive advantage is essential to survival since market demands tend to fluctuate greatly from one period in time to another. The only real reason why Hilti or any other such businesses are surviving is because they are continuously offering their customers something new and different. For example, Hilti’s drilling systems allow the user to carry out drilling at minimal risk of jittering and thus losing control of the tool. The tools were developed using feedback from people using these tools in the actual work area. This was only possible because the talent pool at Hilti understood that they needed to concentrate on what the customer wanted. This was possible if the customer’s expectations were first tabulated and then research was carried out to meet these ends. Before talent management was a reality in Hilti, the typical way forward was to develop products and educate customers about them. Since the application of talent management, things have become altogether different. The focus of Hilti’s design, development and manufacturing teams is entirely the customer now which stands in clear contrast to previous approaches over the issue. It is only through successful talent management that these new approaches have been allowed to take ground. For Hilti such innovation has meant that business is expanding although the world market is in a state of shock. The construction and building industry has been suffering since the global economic recession but Hilti has been expanding largely because the competitive market favors the competitive businesses. Throughout all of this, Hilti’s success derives itself from innovation that comes through successful talent management. 4. Talent Management and Organizational Expansion As mentioned before, Hilti is expanding into newer markets at a rapid pace. In order to support the expansion, Hilti requires the presence of an ever ready and present human resource pool to carry out expansionist activities. For example, Hilti has recently expanded into the European market in England, Belgium and the Netherlands using employees trained and garnered in both the United States and Great Britain. If Hilti were to aim for doubling the size of their business in five to six years, they would require a large human resource pool with the right kind of commitment to handle the incoming challenges. Hilti would require human resources from all kinds of domains such as supply chain management, design and development, research and development, manufacturing, warehousing and the like. In order to support its growth, Hilti would have to expand the size of its talent management operations. In order to do this, Hilti would have to hire more people in this time frame such that the existing human resources would train these new incoming human resources. Since talent management serves to retain people so considerable expansion is possible using talent management. 5. References Carpenter, M., Bauer, T., & Erdogan, B. (2010). Management and Organizational Behavior. New York: Flatworld Knowledge. Fung, I. W., Tam, V. W., Lo, T. L., & Lu, L. L. (2010). Developing a Risk Assessment Model for construction safety. International Journal of Project Management , 28 (6), 593-600. Hilti. (2009). Hilti - Milestones in the Group's Development. Retrieved May 13, 2012, from Hilti: http://www.hilti.com/data/editorials/-12323/milestones_en.pdf Hilti. (2012). Products & News. Retrieved May 13, 2012, from http://www.hilti.com.au/holau/page/module/home/browse_main.jsf?lang=en&nodeId=-125964 Michaels, E., Handfield-Jones, H., & Axelrod, B. (2001). The War for Talent. Boston: Harvard Business Review Press. Perdomo-Ortiz, J., Gonzalez-Benito, J., & Galende, J. (2009). An analysis of the relationship between total quality management-based human resource management practices and innovation. The International Journal of Human Resource Management , 20 (5), 1191-1218. Rammer, C., Czarnitzki, D., & Spielkamp, A. (2010). Innovation success of non-R&D-performers: substituting technology by management in SMEs . Small Business Economics , 33 (1), 35-58. Read More