The benefits of investing in a local talent pipeline
Global Vice President and CEO in Europe of Education For Employment (EFE), Salvatore Nigro, discusses the benefits of local talent when expanding abroad.
Whilst access to credit is becoming easier in some parts of the globe, business leaders and HR professionals have for some time expressed concern that it is becoming increasingly difficult to locate job applicants who have the skills, educational qualifications and experience to perform certain roles. As a skilled, diverse and quality workforce is an important factor in determining the success of a business, these challenges can directly influence the growth and competitiveness of companies both today and in the future.f
For many organisations, one of the key drivers of an integrated global HR strategy is the need for talent mobility within the company. This is increasingly significant for companies looking to expand abroad, which must source the correct talent to open and run their new premises.
For HR teams, deducing the most suitable recruitment strategy for international expansion can be difficult. On average, an expat costs a company three times what they would in an equivalent position back home, mostly due to transportation, relocation benefits and training costs. This is a hefty investment considering that a large proportion of expats return early or join a competitor one year after repatriation.
The other option is to hire local staff, a strategy that is commonly overlooked out of fear that local talent pools lack the required skills. The irony of this is that well-trained local professionals can offer a huge amount to a company in terms of language skills, cultural knowledge and economic stability. As natives to the region, they have strong ties with their communities – enabling them to navigate potential problems more effectively – and come at a fraction of the cost of expats.
Local talent also has a statistically higher retention rate, particularly in developing areas. This is because businesses are engaging a workforce that has limited economic opportunities in life and is grateful to those who have invested in them. As such, these employees often stay with a company for a large proportion of their career, saving businesses hundreds of thousands of pounds in recruitment costs.
By investing in training and educating, businesses are also creating a younger pool of ‘wider talent’ to reduce pressure on existing trained resource. This strategy is notably useful in developing regions such as the Middle East and North Africa (MENA), which concentrates more than half of the world’s ‘working poor’ and unemployed youth. A large proportion of these youth have a tertiary education but require training on the 21st century skills, particularly digital skills, needed for infrastructure and economic development. By tapping into and upskilling this population, businesses can widen their talent pool and assist with economic development in these regions.
Morocco is a key example. The entry of aeronautics, renewable energy or automotive companies such as Renault pushed economic growth to 3.1% in 2018, making it the sixth largest African economy. In partnership with specialised organisations and the Moroccan government, these businesses have been developing local training programmes and employing local talent to upskill workers. These sorts of efforts have had the added benefit of gaining positive media traction and enhancing brand recognition. In addition, 66% of consumers are also willing to pay more for products from socially responsible companies, so training local staff can aid company sales and form part of their CSR initiatives.
Overall, a large number of companies are expanding abroad in search of greater profits and lower production costs. Yet, until businesses increase domestic hiring levels, they will continue to rely on the unsustainable and expensive method of expatriating staff. By adopting an inclusive and flexible corporate culture that supports the integration and development of nationals into the workforce, businesses can enhance reputation and create a reliable and stable workforce, whilst tackling skills shortages in regions such as MENA.
Education For Employment (EFE) is a leading network of non-profits that trains young people and links them to jobs across the Middle East and North Africa (MENA). EFE operates in nine countries across the region to boost youth employment.
5 minutes with... Janthana Kaenprakhamroy, CEO, Tapoly
Founder and CEO of award-winning insurtech firm Tapoly, Janthana Kaenprakhamroy heads up Europe’s first on-demand insurance platform for the gig economy, winning industry awards, innovating in the digital insurance space, and leading with inclusivity.
Here, Business Chief talks to Janthana about her leadership style and skills.
What do you do, in a nutshell?
I’m founder and CEO of Tapoly, a digital MGA providing a full stack of commercial lines insurance specifically for SMEs and freelancers, as well as a SaaS solution to connect insurers with their distribution partners. We build bespoke, end-to-end platforms encompassing the whole customer journey, but can also integrate our APIs within existing systems. We were proud to win Insurance Provider of the Year at the British Small Business Awards 2018 and receive silver in the Insurtech category at the Efma & Accenture Innovation in Insurance Awards 2019.
How would you describe your leadership style?
I try to be as inclusive a leader as possible. I’m committed to creating space for everyone to shine. Many of the roles at Tapoly are performed by women and I speak at industry events to encourage more people to get involved in insurance/insurtech. Similarly, I always try to maintain a growth mindset. I think it’s important to retain values to support learning and development, like reliability, working hard and punctuality.
What’s the best leadership advice you’ve received?
Build your network and seek advice. As a leader, you need smart people around you to help you grow your business. It’s not about personally being the best, but being able to find resources and get help where needed.
How do you see leadership changing in a COVID world?
I think the pandemic has proven the importance of inclusive leadership so that everyone feels supported and valued. It’s also shown the importance of being flexible as a leader. We’ve had to remain adaptable to continue delivering high levels of customer service. This flexibility has also been important when supporting employees as everyone has had individual pressures to deal with during this time. Leaders should continue to embed this flexibility within their organisations moving forward.
They say ‘from every crisis comes opportunity’, what opportunities do you see?
The past year has been challenging, but it has also proven the importance of digital transformation in insurance. When working from home was required, it was much harder for insurers to adjust who had not embedded technology within their operating processes because they did not have data stored in the cloud and it caused communication delays with concerned customers at a time when this communication should have been a priority, which ultimately impacts the level of customer satisfaction. This demonstrates the importance of what we are trying to achieve at Tapoly in driving digitalisation in insurance and making communication between insurers and distribution partners seamless.
What advice would you give to your younger self just starting out in the industry?
Start sooner, don’t be afraid to take (calculated) risks and make sure you raise enough money to get you through the initial seed stage.