THE BLOG
09/07/2009 05:12 am ET Updated May 25, 2011

The Human Element: Managing Human Capital in the New Era of Business

As the economic recovery takes hold, more companies are beginning to shift their focus from survival to winning in the marketplace.

An important aspect of this shift, and the interest of this blog, is the resumption of the war for talent. Readers may remember the research by McKinsey & Co some years ago. Although we recognize that employment is a lagging indicator of growth, some of the 6 million jobs lost in the last two years will surely convert into a renewed focus on attracting, developing and retaining talented employees.

We think the war for talent "part deux" will be a different kind of war. To paraphrase, we hope this blog will contribute to a new type of "coalition of the willing" -- a coalition of readers and contributors inclined to think creatively about talent, career and development. We look forwarding to providing a variety of examples of practical innovation in the human capital management space. Each entry will offer a new idea in talent management accompanied by an example or two from around the globe.

As a first case in point, we are enthralled by the creativity of Novartis in Latin America (LatAm). Novartis is a global pharmaceutical company, headquartered in Basel, Switzerland, with operations in many countries, revenues above $40 billion US, and almost 100,000 employees around the globe (full disclosure: Novartis is a client). But while as large and complex as any major corporation, it has not lost its interest in developing talent or in finding new and creative ways to do so.

For Novartis, a key challenge is attracting and retaining Gen Y's. As Pilar Martinez, HR manager in Mexico, describes the challenge, "We have some outstanding young people, but our Gen Y's are ambitious and impatient. We can't manage their careers in the same way we managed previous generations. We'll lose them."

The experience of Novartis LatAm is part of a global trend. As a recent PricewaterhouseCoopers survey found, Gen Y's or Millenials expect job mobility and rapid promotion, and are eager to experience assignments outside their home country. In the PwC survey, 80 percent wanted an expatriate opportunity and 70 percent expected to use a language other than their home country's during their career.

But, this generation is also willing to work hard and long, and eager to demonstrate loyalty to their employer ... so long as their employer is loyal in return. They value longer term training and development opportunity above short term financial benefit. As the PwC reported, "Training and development is the most highly valued employee benefit. The number choosing training and development as their first choice of benefit is three times higher than those who chose cash bonuses. Ninety-eight percent believe working with strong coaches and mentors is an important part of their development."

HR at Novartis LatAm has taken a novel approach to this challenge. The problem with providing international assignments is the historical cost. Companies generally provide a range of benefits to expatriate employees, from generous moving costs to family and housing allowances (for example, educational support for children, hardship allowances for some locations, etc.) All of these can increase total employee costs several fold.

Most companies save expensive moves for high-potential executives and use expatriate assignments to test and prepare them for senior roles. They have a hard time justifying the cost of moving young people who haven't yet proven themselves.

Ironically, young people are far more willing and less costly to move than more senior people, who more often own houses, have children in school, and have partners who are deeply invested in their own careers.

Marcelo Fumasoni leading the HR team for Novartis LatAm and his colleagues jumped on the opportunity. They initiated the "lean expat" program in which they "exchange" young high potentials -- as young as 24 to 26 -- across Novartis operations.

Since participants are young, the costs are far more manageable. Participants must be high potential. Where possible, they are part of an exchange with someone from the receiving operation. They are treated as "local" employees in terms of pay and benefits. They are away for one to two years, with a clear expectation that they will return to their countries with a value added component in experience and maturity.

Mentorship is also part of the offer. As Martinez points out, "We want them to feel appreciated, developing and not abandoned. They are periodically contacted by a senior person who is their home country 'mentor'. And, they also have a mentor in the receiving country to help them get the most of their assignment."

So, for no greater cost, Novartis is helping its best and brightest young people take a more global perspective. More importantly, it helps the company build a reputation within LatAm market that it is not the stiff, Swiss company people might have assumed. Instead, it is becoming known as a company that is innovative, responsive to the needs and interests of young professionals, and willing to provide real opportunity for high performers to grow and learn.

Jon Younger is a Partner of The RBL Group, a strategic HR and leadership systems advisory firm. Jon leads the Strategic HR practice area and is also a Director of the RBL Institute. He is co-author, with Dave Ulrich and three other principals at The RBL Group, of "HR Competencies" (SHRM, 2007), "HR Transformation" (McGraw-Hill, July 2009) and many articles. Last year he logged client work in 35 countries.