Overcoming talent shortages in the GBS sector
The talent shortage has become a serious challenge for most GBS organizations in the last couple of years. Shared services are not alone in facing this issue: from large multinational companies to micro enterprises, all businesses are trying to overcome and manage talent shortages. Our article aims to explore recent trends and attempts to find solutions for having the right talent with the right skills at the right time. Experience shows that these initiatives are neither easy nor cheap. The problem that keeps HR directors and site leaders awake at night is the concern of high staff turnover and growing employee expectations for flexibility, higher pay, job security and off-time.
17 March 2022
Shared Service State of Industry Survey hosted by SSON Analytics in 2021 found that six out of ten employees in the business services sector leave the industry within three years, however, employees who have stayed in the sector for 5 years or longer are much more likely to work there long-term.1
We also find that employees are seeking the opportunity to learn, grow and improve their professional skills. More employees are searching for opportunities to utilize their full potential and challenge themselves. Employers can tap into this aspiration by investing in learning and talent management so that their employees can grow in their area.
According to the HIPA 2021 survey the main fluctuation drivers – similarly to 2020 survey results – are salary expectations (70.5%), followed by work content (43.5%), the lack of career and training opportunities (33.5%) and opportunities in other countries (19%).2
The responses for the 2020 HOA survey also revealed that one in four employees switched the previous year and 35% planned to look for a new job in 2021.3
Two main approaches we see are that companies are providing their employees with sample training courses, and they use alternative workforce.
The World Economic Forum sounded an alarm in January 2020 by announcing: “The world is facing a reskilling emergency. We need to reskill more than 1 billion people by 2030.”4 The underlying message here is that organizations, governments and society need to work together to ensure people around the world are not left behind.
93 percent of GBSs have developed career paths within the company and are also strong in training their employees i.e. 91% of the team receives technical skills training, 73% develops soft skills, 61% receives foreign language courses and 45% management skills training. 3 In order to design learning curves while keeping it scalable, most companies use some kind of learning management platforms, such as Talent lms, Subaa lms, SuccessFactors on Finlearn. While these tools are efficient in addressing the problem to a certain extent, they will not fully solve the challenges of talent reskilling on their own.
2. Alternative workforce
The COVID-19 pandemic highlighted the importance of alternative workforce in helping to keep a disrupted economy afloat. Global business services (GBS) and shared services organizations may be able to protect themselves from unpredictable demand triggered by external factors by proactively integrating the adaptable and available alternative workforce into their operating model. It enables these firms to quickly shore up resource capacity where it is most needed. Integrating alternative workforce also offers optionality for future business continuity planning.
Until now, GBS and shared services spectrum have typically relied on a traditional 2x2 framework with the following axes:
- Relationship to the business, ranging from centralized to local
- Method of adding value, ranging from transactional and specialized to strategic and knowledge-based
The 2x2 framework primarily answers the questions of “where” and “what” of a GBS or a shared services center, but now it is important to also answer the question of “who.” As the alternative workforce enters the labor market in greater numbers, the traditional 2x2 will likely require an additional dimension to account for different types of workers.
The alternative workforce tends to update their skills more frequently and can typically ramp up within days rather than weeks, because their long-term success depends on staying up-to-date and minimizing time to delivery. By leveraging this new workforce, GBS and shared services centers may achieve new economies of scale while reinventing their operating models to account for an adaptable workforce that continues to grow rapidly. The majority of alternative workers looking for projects online are starting those projects within the week. Due to the rapidly changing needs of the environment, alternative workers tend to be more available, as they are dependent on these projects for their primary source of means. Organizations can leverage this adaptable and available workforce as a flexible source of talent to meet ongoing demands.5
The ongoing battle for talent across industries and sectors does not seem to ease. In some sectors companies are willing to outbid others in attracting talent or they may have to reimagine their workplaces and the way they work to offer the right non-monetary incentives to keep employees motivated enough to offset any lure of more money from other businesses.