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УПРАВЛЕНИЕ ЧЕЛОВЕЧЕСКИМИ РЕСУРСАМИ
УДК: 331.005.95 JEL: M510
ARE LOCAL COMPANIES AND MULTINATIONAL CORPORATIONS EQUALLY EQUIPPED TO STRUGGLE FOR TALENTS IN RUSSIA?
A. S. Osipova
HSE University,
20, ul. Myasnitskaya, Moscow, 101000, Russian Federation
For citation: Osipova A. S. 2022. Are local companies and multinational corporations equally equipped to struggle for talents in Russia? Vestnik of Saint Petersburg University. Management 21 (1): 105-130. http://doi.org/10.21638/11701/spbu08.2022.105
Firms increasingly adopt various talent attraction practices in order to hire the most talented employees and outperform competitors. Although talent attraction is considered critical for the firm success, there is little information on how specifically local firms and multinational corporations strive to win the "war" for talented employees in Russia. To bridge this gap, this study aims to explore talent attraction systems of Russian firms and their foreign counterparts, which they use in order to increase a competitive advantage. The research is based on a qualitative methodology, the data was collected using thirty three in-depth interviews with HR managers and further analyzed with the help of NVivo 12 software. The study reveals that both local firms and multinational corporations apply the same set of talent attraction practices at the operational level. However, only a few foreign companies use a strategic approach for the creation of external and internal talent pools which help them to quickly react to disruptive changes. The article contributes to existing research in two ways. First, it develops the resource-based view on talent management using the HR architecture framework and shows how talent attraction systems enable companies to acquire various talent groups in order to improve the competitive advantage. Second, this study explores talent attraction as a system on the strategic, policy and practices levels, describing their similarities and differences in local companies and multinational corporations.
Keywords: talent management, talent attraction, recruitment, talents, resource-based view. introduction
Despite talent management being a new term in the discourse of Russian business, the vast majority of leading local companies implement talent management programs to attract and retain the best employees in the external and internal labour markets. Due to the shortage of highly skilled workers, which is widely recognized not only in Russia but
© St. Petersburg State University, 2022
also in other countries, the labour market for talented employees is competitive. According to [CEO Pulse Survey, 2016], 70% of chief executive officers (CEOs) considered lack of talents as a key constraint on the companies' success. In a similar vein, an industry report of Deloitte showed that the problem of providing companies with talent was the third most significant issue for managers [Deloitte..., 2017].
Talented employees as human assets provide a competitive advantage to companies, so many academics apply the resource-based view in order to explore the role of human resources (HR) in organizations [Wright, McMahan, McWilliams, 1994; Jackson, Schuler, 1995; Snell, Youndt, Wright, 1996]. However, not only talents themselves are proven to increase firms' competitive advantage, but also HR practices aimed at this employee category [Barney, Wright, 1998]. In a large volume of literature, it was revealed that HR practices are significantly related to firm performance measures, profits, and expenses [Wright, Gardner Moynihan, 2003; Wright et al., 2005].
The overall intention of firms to implement better talent management practices is usually described with the concept of the "war for talent", coined by [Michaels, Hand-field-Jones, Axelrod, 2001]. In their prominent book, referring to the longitudinal study of McKinsey, the authors show that companies achieve a competitive advantage not due to the quality of the goods and services, but because of better capabilities to manage talent. In order to achieve its goals and a competitive advantage, in line with the human resource management system (HRM system) a company needs the talent management system that contains the interrelated and jointly supportive strategies, policies and practices [Armstrong, Taylor, 2014]. As HRM system, a talent management system aims to attract, select, develop, reward, assess and retain talents.
Consequently, a talent attraction system, being the part of the talent management system, also consists of strategies, policies and practices, the latter of which are defined as the set of tools and methods used by the companies to attract different groups of talents [Kehoe, Wright, 2013; Armstrong, Taylor, 2014]. Talent attraction is considered to be the cornerstone of talent management, because it enables a company to hire the most valuable employees from external labour market and to attract those within internal one [Boxall, Purcell, 2003; Holland, Sheehan, De Cieri, 2007]. Moreover, the specific value created by a talent attraction system is associated with filling positions within an organisation, which have the potential to differentially impact on performance with the best available human resources [Collings, Mellahi, 2009].
Various companies operate in the Russian market and have a demand for talent. Having a competitive advantage in terms of talent management practices implies that some of firms use more sophisticated and innovative approaches and methods than others. Moreover, some of these companies may have Soviet roots and replicate a Soviet-type personnel policy. At the same time, many knowledge-intensive firms were created after the collapse of the USSR, so they did not inherit the Soviet tradition of HR management [Muratbeko-va-Touron, Kabalina, Festing, 2018]. Despite the differences in business models, Russian companies and multinational corporations (MNCs) operate in competitive labour markets, and one of the major challenges for them is to attract talented employees.
According to [Lepak, Snell, 1999], who developed the resource-based view, proposing the HR architecture framework, it may be inappropriate to use universal talent attraction practices. As different groups of talents possess skills that vary in importance to a firm's competitiveness, the systems used to manage them are likely to vary [Jackson, Schuler, Rivero, 1989]. In other words, for companies it could be beneficial to imply different talent attraction practices for different talent groups. However, few scholars devote their papers to the differentiation of talent attraction practices. Some researchers compare various talent attraction practices in accordance with industries, leaving the problem of their differentiation in accordance with talent groups unexplored [Roshchin, Solntsev, 2017]. Few authors bridge this gap, analysing various talent management practices for a particular talent group — young talents, including talent attraction practices [Kabalina, Muratbekova-Touron, 2016; Muratbekova-Touron, Kabalina, Festing, 2018]. Thus, the segmentation of talent attraction practices in accordance with talent groups is poorly explored in the literature, although it allows companies to use them as a source of competitive advantage. Therefore, the purpose of this study is to define the characteristics of talent attraction systems as one of the important elements of talent management systems used for different groups of talented employees.
Although some authors explore talent management practices in local companies [Latukha, 2015] and compare approaches to talent management in MNCs and Russian companies [Latukha, Tsukanova, 2013], talent attraction remain only partly covered in these papers. In scientific community there is a high demand in the comparison of talent attraction practices of Russian firms to their foreign counterparts [Holden, Vaiman, 2013]. Thus, for business communities that would be of a high value to reveal, what talent attraction systems are used by local firms and MNCs and what companies apply most advanced ones. It would help companies to elaborate their current talent attraction systems and improve their competitive advantage. However, there is an extremely small number of papers that explore talent attraction systems and practices for various talent groups in local firms and MNCs, operating in Russia, and make their comparison in order to enable companies to improve their competitive advantage.
This paper consists of three sections. In the first section, the theoretical background of the research sets out an overview of talent attraction in emerging markets and Russia, through the lens of the resource-based view. In the second section, the methodology and the sample of the study are described, in which data was collected using a method of deep semi-structured interviews with thirty-three experts, who are specialising in HR and talent management. The third section presents the main results of the research, which touch on the features of talent attraction in local firms and MNCs.
theoretical background
Exploring talent management through the lens of the resource-based view. According to the resource-based view of the firm, human resources is one of the most important sources of its competitive advantage [Barney, Wright, 1998]. This theoretical
framework provides a link between HR management and organizational performance, stating that employees are rare and valuable assets [Holland, Sheehan, De Cieri, 2007]. The resource-based view is considered to be the main theoretical framework for research on talent management, with 30% of scientific papers using it [Gallardo-Gallardo et al., 2015]. The concept of "pivotal" positions is widely used in the resource-based view on talent management, which focuses not only on attraction of valuable candidates, but also on attraction them to those positions that are of the highest strategic importance to the company [Boudreau, Ramstad, 2005].
However, not only talents are the source of a competitive advantage for a firm, but also talent management practices themselves [Schuler, MacMillan, 1984; Barney, Wright, 1998] highlight that firms that apply the best HR practices (attraction, selection, training and development etc.) will have a competitive advantage over firms that fail to use these particular practices. In a number of prominent papers, it was proven that HR practices do provide value to the firm [Boudreau, 1991; Steffy, Maurer, 1988].
But should a company apply a single approach for attracting talents? According to [Miles, Snow, 1984], certain practices might be centralized or standardized for all talents, while others might be customized to match the specific requirements of particular talent groups. Based on the resource-based view, D. Lepak and S. Snell developed the HR architecture framework that includes four quadrants in terms of employees' value and uniqueness for the company. They argued that "it may be inappropriate to simplify the nature of human capital investments and suggest that there exists a single optimal HR architecture for managing all employees" [Lepak, Snell, 1999, p. 32].
The idea of application of various practices to different groups of employees is also discussed in the area of talent management. J. Boudreau and P. Ramstad were the first who offered the paradigm of talent segmentation with exceptional focus on pivotal talents that contribute to the sustainable strategic success of a firm [Boudreau, Ramstad, 2005]. Further M. Calle-Duran with the co-authors revealed various configurations of talent pools, where the segmentation was fulfilled according to organizational levels: top-talents, experts, young talents (raw diamonds) [Calle-Duran, Luz Fernandez-Alles, Valle-Cabrera, 2021]. However, talent segmentation can bring some drawbacks to the company as discrimination, lack of knowledge sharing and cognitive biases [Pfeffer, 2001; Yarnall, 2011].
In this study the differentiation of talents would be applied in terms of organizational levels as the most widely used employee classification form [Miles, Patrick, King, 1996; Rice, Shook, 1990]. The most dramatic change in the job requirements occurs with the transition from entry (graduate) to specialist level and from specialist level to managerial one [Kossek, Lautsch, 2018]. Because of that, in this study the talents are broken into three categories: graduate talents, talented specialists and talented managers, which will enable us to explore the most prominent change in talent attraction practices.
In the following section talent attraction will be explored as a system, which will enable us to understand, how particularly it enables companies to gain the competitive advantage via strategies, policies and practices.
Defining a talent attraction system. Turning to the definition of talent attraction, a pertinent terminological gap was revealed. A number of authors equate attraction with recruitment [Barber, 1998; Breaugh, 2008; Dutta, 2014], while in other papers recruitment is divided into attraction and selection [Schneider, 1987; Sahay, 2014]. In this paper the attraction will be explored as the first stage of recruitment process, which is followed by screening, assessment, and verification (checking recommendations) [Schneider, 1987; Sahay, 2014].
The classic definition of employee attraction is provided in [Bratton, Gold, 2003], which refers to the interaction between potential candidates and the organization's image, values and information about it. From organizational perspective, attraction is defined as the ability of a firm to present itself in a positive light to potential candidates as a place where they would like to work [Rynes, 1991]. Fundamentally, personnel attraction includes four stages: communication a vacancy to potential candidates, creating a pipeline of candidates, retaining potential candidates and influencing the decision to accept a job offer [Barber, 1998; Breaugh, 2008]. K. Uggerslev and her colleagues highlight that the first two stages are the most crucial for attraction outcomes and here recruiters most focus their efforts [Uggerslev, Fassina, Kraichy, 2012]. Thus, in this study we will focus on vacancy communication to talents and talent pools creation.
S. Rynes presents a personnel attraction system, which includes strategic level (contextual factors and strategies), operational level (practices) and results [Rynes, 1991]. This system goes in line with the HR system model that consists of three levels: strategy, policies and practices [Armstrong, Taylor, 2014]. Consequently, in line with the HR system model [Armstrong, Taylor, 2014] and the personnel attraction system [Rynes, 1991], a talent attraction system includes three levels: strategies, policies and practices.
Starting with the strategic level, it is crucial to outline the definition of talented employees in a company. The definition of talent belongs to the strategic level of talent attraction, because it reflects strategic directions of business development and those pivotal positions, which should be filled in by talent. It also shows, on which employee group further policies and practices should be aimed at. It is the cornerstone of further talent attraction activities that helps to distribute resources for dealing with the most pivotal talent groups [Boudreau, Ramstad, 2005]. Some companies define talent as a set of qualities (object approach), while others consider talent as employees themselves (subject approach) [Gallardo-Gallardo, Dries, Gonzalez-Cruz, 2013]. M. Latukha and T. Tsukanova conducted complex research into talent management practices in Russia, comparing local firms to MNCs [Latukha, Tsukanova, 2013]. They found out that foreign companies operating in Russia tend to define talent as potential and performance, while Russian organizations use such meanings as giftedness and knowledge. After the definition of talent was formulated, a company should find the sources of talents attraction, which is realized in the policy level.
Moving on to talent attraction policies, they could be defined as guidelines that outline, how specific aspects of attraction should be applied. Typically, talent attraction policies deal with such questions as the type of talents to attract (in accordance with
organization level, job function and experience) and the type of a talent pool to focus on (internal or external). As it was mentioned earlier, in this study the classification of talents would be applied in terms of organizational levels [Rice, Shook, 1990; Miles, Patrick, King, 1996].
The most pertinent dilemma of talent attraction is connected with the policy of attraction talents from the external talent pool or to invite candidates from the internal ones. In other words, it is the so-called "make or buy" dichotomy. M. Bidwell found out that the productivity of candidates hired from the external labour market was lower than among employees hired from within, in the first two years of work, but the wages of "newcomers" were higher by 18% [Bidwell, 2011]. In academic literature there is extremely few information on what type of talent pools use both local and MNCs in Russia. When a company found a balance between internal and external talent pools, it is crucial to define methods and tools of talent attraction, which is defined on the practices level.
The final element of a talent attraction system being talent attraction practices. Typically, HR practices refer to the tools and methods by which companies manage employees via HR functions (attraction, selection, training and development, appraisal, rewards, relations, administration) [Armstrong, Taylor, 2014; Kehoe, Wright, 2013]. In this paper the term talent attraction practices would be defined as the set of tools and methods used by the companies to attract different groups of talents. Overall, attraction practices can be grouped into two major categories: online and offline ones. Online attraction practices include company websites, job boards, social media, while offline ones consist of advertisement in newspapers or journals, events and referrals [Armstrong, Taylor, 2014]. Moreover, large companies typically use the services of recruitment and executive search agencies [Survey of resourcing..., 2013]. O. Novitskaya and C. Brewster, using the lens of national context effects, completed their study on HR management practices of Western subsidiaries in Russia [Novitskaya, Brewster, 2016]. They revealed that weak information flow on the labour market and low trust outside of personal networks, make MNCs use such attraction practices, as referral recruitment programs and services of recruitment agencies.
Research papers that are devoted to the topic of talent attraction focus mainly on the cross-cultural issues of talent attraction [Baum, Kabst, 2014; Egerova et al., 2015], digital talent attraction practices [Lizbetinova, Hitka, 2016; Chamorro-Premuzic et al., 2017], talent attraction of particular talent categories [McCracken, Currie, Harrison, 2016; Deters, 2017; Muratbekova-Touron, Kabalina, Festing, 2018]. None of them provides the exploration of talent attraction as a system and the comparative analysis of local practices with MNCs ones.
In the following subsection it would be observed, what are the main characteristics of talent attraction systems in Russia and what research gaps exist. On the basis of the latter the research questions of the current study would be formed.
Exploring the "war for talent" in Russia. Talent management maturity level in Russia is described by the scholars as low [Latukha, 2015]. The main reasons behind this
being macro factors that negatively influence talent management implementation: restrictive political environment, structural imbalance in economy, public mistrust of institutions, weak labour legislation, soviet mental software, and poor empowerment [Outila, Vaiman, Holden, 2018; Latukha et al., 2020]. Modern talent management practices are often introduced into Russian companies through the practices of MNCs. Scholars highlighted that foreign firms improved Russian talent management dramatically, but it still remains in transition from the Soviet heritage [Latukha, Malko, 2019]. A large volume of literature is devoted to the examination of talent and HR management practices of MNCs' subsidiaries operating in Russia [Fey, Bjorkman, 2001; Bjorkman, Fey, Park, 2007; Fey et al., 2009; Gurkov, 2016; Novitskaya, Brewster, 2016; Gurkov, Morgunov, Saidov, 2017]. However, the number of empirical papers that compare local and MNC talent management practices is extremely sparse [Latukha, Tsukanova, 2013; Latukha, 2015].
The number of research papers, devoted to talent attraction in Russia, is dramatically scarce [Latukha, Tsukanova, 2013; Muratbekova-Touron, Kabalina, Festing, 2018]. Many empirical papers, exploring HR and talent management in Russia, are devoted to such practices as compensation and benefits, training and development, career management, performance assessment, workplace organization, internal communication, while attraction practices remained uncovered in their research designs [Fey, Bjorkman, 2001; Bjorkman et al., 2007; Fey et al., 2009; Gurkov, Zelenova, Saidov, 2012; Gurkov, Morgunov, Saidov, 2017].
K. Fey and co-authors intentionally decided to exclude attraction practices from their study, justifying it by the assertion that this practice does not directly affect a company's effort to make employees an effective asset for organization [Fey et al., 2009]. However, both HR managers in MNCs and their local counterparts define talent attraction as an extremely crucial function for business, with 94% of companies actively implementing it [Latukha, Tsukanova, 2013]. On top of that, M. Latukha describes Russian job market as a "war for talent" because of the pressing demand of highly competent employees and leaders who are able to work in global environments [Latukha, 2018]. In addition to that, it was found out that talent attraction plays a more crucial role in MNCs than in domestic firms, because they require a more complicated skill set [Skuza, Scullion, McDonnell, 2013]. At the same time, in Russia, India and China external talent attraction is perceived as an additional risk, due to the adaptation of new talents to the corporate culture [Latukha, Selivanovskikh, 2016].
It could be concluded that talent attraction in Russia is poorly explored [Latukha, Tsukanova, 2013; Muratbekova-Touron, Kabalina, Festing, 2018]. Few papers are devoted to the exploration of talent attraction as a system, although it enables companies to improve their competitive advantage with the help of talent segmentation [Bjorkman et al., 2007; Fey et al., 2009]. Consequently, the main research question could be formulated as follows. What are the characteristics of talent attraction systems applied for various talent groups by local firms and MNCs in Russia, which enable them to fill key positions with the most valuable employees in order to improve a competitive advantage?
Article contains research sub-questions:
♦ Strategic level. How do HR specialists define the term "talented employee" in local companies and MNCs?
♦ Policy level. On what talent pools (external or internal ones) do local and foreign organizations rely while attracting talents?
♦ Practices' level. What practices of talent attraction are applied by HR specialists in accordance with talent groups (young talents, specialists and managers) in domestic firms and MNCs?
The research sub-questions above are identical for Russian companies and their international counterparts. This is necessary for the comparison between talent attraction systems of local companies and MNCs and finding the most advanced ones among them.
methodology
This study is based on a qualitative methodology, and a grounded theory approach was used as the main research framework [Strauss, Corbin, 1990]. The reasoning behind this choice of approach being that this study is devoted to the exploration of a new managerial phenomena, and the grounded theory itself has origins in organizational studies [Martin, Turner, 1986]. The procedures of a grounded theory allow to provide a theoretical explanation of a phenomena of talent attraction systems based on a set of concepts (talent definition, types of talent pools, attraction practices) [Strauss, Corbin, 1990]. Such procedures as simultaneous data collection and analysis, outlining of concepts comparisons and interrelationships form a rigorous data collection and analysis framework, which allows to receive reliable results [Strauss, Corbin, 1990].
The data was collected during February 2019 till March 2020 through in-depth semi-structured interviews with thirty-three HR managers from Russian and multinational companies (one respondent per company), which satisfies the main sampling criteria of the grounded theory approach, being that the participants of the study should experience the phenomenon under different conditions that are reflected in sampling criteria [Starks, Trinidad, 2007].
In order to collect empirical data, an interview guide was developed, based on the research questions listed in the previous paragraph (Appendix). The structure of the guide and the formulation of questions addressed to the respondents were edited as a result of pilot testing.
Respondents were searched for on social media, using the search queries "recruiter", "talent manager", "talent acquisition manager". This method of reaching respondents can be connected with one potential bias. Those potential experts in talent attraction, who do not use social media, could not be included in the sample. Another limitation of this method lies in the job title definition. Those potential respondents, who actually deal with talent attraction, could have a job title that is different from given search queries. Consequently, such cases do not appear in the search results.
The main criteria for the selection of companies and respondents were the following:
♦ talent management presence in the company (staff reserve, high-potential programs and talent pools);
♦ diversity of companies by industry and capital ownership;
♦ the respondent's job title: HR business partner, HR specialist, recruiter, talent attraction manager, talent manager etc.
The information about the study respondents is presented in Table 1.
Table 1. The information about the study participants
Code* Industry Number of staff Work experience, number of years Job title
1 2 3 4 5
Ml FMCG** 20 000 7 Talent attraction manager
M2 FMCG 1 000 8 Senior HR business partner
M3 FMCG 70 000 16 Global talent manager
M4 Manufacturing and distribution of cosmetic products 554 11 Talent manager
M5 Production and distribution of appliances 1 200 7 Head of recruitment, learning and development department
M6 Energy management and automation 12 000 9 Talent attraction manager
M7 Power engineering, oil, gas, healthcare, transport engineering 1 500 15 Talent attraction partner
M8 Automotive industry 4 453 16 HR projects director
M9 FMCG 2 000 12 Head of people and organisational development
M10 Transport company 200 12 Head of talent attraction
Mll Consulting 2 700 20 Chief of staff
Continuation of the Table 1
1 2 3 4 5
M12 Consulting 5 400 7 Senior recruitment associate
M13 Pharmaceuticals and medical devices 1 400 11 Talent attraction manager
M14 Pharmaceuticals, ophthalmology 900 19 Head of talent management and organisational development
M15 Pharmaceuticals 2 000 18 HR business partner
M16 Pharmaceuticals, healthcare 800 7 HR business partner
M17 Pharmaceuticals and medical devices 120 5 Recruiter
M18 Consulting 1 500 7 HR business partner
R1 Nuclear power 300 20 Head of performance department
R2 Power engineering 73 782 20 Deputy head of administration and personnel development
R3 Transport company 13 000 9 Head of HR communications
R4 Development 403 9 Head of recruitment
R5 Mining 70 000 14 Head of HR and social policy
R6 Education 100 10 Recruiter
R7 Consulting 8 961 3 Talent attraction specialist
R8 IT 2 174 10 Specialist in personnel assessment
End of the Table 1
1 2 3 4 5
R9 IT-consulting 300 8 HR business partner
R10 Telecommunication 142 500 12 Head of talent attraction
R11 Telecommunication 30 000 14 Head of recruitment and employer brand department
R12 IT 6 200 14 Talent attraction manager
R13 Consulting 25 3 Recruiter
R14 IT 5 000 5 Recruiter
R15 Banking 27 359 10 Senior recruiter
Notes: * — the first letter of the code indicates capital origin: "M" stands for a multinational company, while "R" refers to a local Russian company; ** — fast moving consumer goods.
As can be seen from Table 1, the resulting sample demonstrates the diversity in terms of industry, size of company, and respondents experience. Overall, 132 invitations were sent via social media, and thirty-three companies representatives agreed to take part in the research. Nineteen interviews were conducted in the form of face-to-face conversations. In the remaining four cases (R3, R11, M7, M16), interviews were held in the form of web- or telephone calls. After expert interviews had been conducted in the Russian language and recorded with the permission of the respondents, they were transcribed. The average interview duration was 53 minutes, with a minimum duration of 28 minutes and a maximum of 74 minutes.
The texts of the interviews were analysed with the use of NVivo 12 software in two cycles of coding: assignment of codes to data chunks and analysis of the outlined codes [Miles, Huberman, Saldana, 2014]. At the first cycle of coding, interview transcripts were analysed using eclectic coding with the help of structural and magnitude coding, as well as sub-coding [Saldana, 2013]. All quotes of the interviews were assigned to thematic labels and those united by a common topic or category, were given a particular code. At the second cycle of coding, using axial, focused, and theoretical coding, the connections between the outlined codes were established, and the main trends and cause-effect relationships were identified. In parallel with these two stages of the analysis, the meanings of the main identified trends and relationships were interpreted [Kvale, 1996].
results
Strategic level of talent attraction. How do Russian and multinational companies define the term "talent"? Overall, the analysis of interview transcripts revealed that companies use both subject and object approaches to define talent [Gallardo-Gal-lardo, Dries, Gonzalez-Cruz, 2013], which is shown in Table 2. It could be observed that all approaches to talent definitions are given via the lens of the resource-based view. Talent is interpreted by HR experts either as a valuable resource at pivotal positions that brings competitive advantage, or as particular talent characteristics, contributing into that (competencies, potential, learning agility, devotion).
Table 2. Approaches to talent definition
Talent definition For what company's definition is typical? Respondents' answer
Pivotal positions Both Russian companies and MNCs We are thinking about the pivotal positions, to which extent they are key for the company, because we cannot build talent pools for each position, that is too expensive (Interview M16)
Set of competencies Both Russian companies and MNCs There are competencies for each position and there are competencies that are obligatory for each employee. And a set of these competencies gives a profile. Based on this profile, we are looking for a person (Interview M13)
Potential MNCs I would say that we identify potential, which is the ability to move to vertical or horizontal positions. Vertical movement is our priority (Interview M6)
Learning agility MNCs We are using a learning agility concept. It is the ability to cope with situations that you encounter for the first time in your life (Interview M14)
Devotion Russian companies We have always built our personnel policy on attracting people who are talented in terms of loyalty to the profession, because of its complexity in terms of execution (Interview R2)
Workforce Russian companies Each employee has talent, it does not matter if he or she is a trainee or an expert. Well, it is clear that they just have a different level of expertise, a different level of experience (Interview R13)
Pivotal positions. In line with [Boudreau, Ramstad, 2005; Collings, Mellahi, 2009], both MNCs and local companies interpret talent as those occupying pivotal positions, which make the greatest contribution to business results. Defining talent as a key role in a company corresponds with the resource-based view, where employees are seen as the most valuable resources.
Set of competencies. Both Russian and MNCs use the list of competencies to define talent. In these cases, talent can be understood as a set of behavioural patterns.
Potential. Only multinational companies (M3, M6, M11, M15) defined talent as a potential. And here comes a crucial point for further discussion: are talent and potential the same things, or is a portion of someone's talent found in their potential?
Learning agility. Three MNCs (M4, M5, M15) used the learning agility concept to describe talent, which corresponds with the problem of talent transition [Groysberg, Sant, Abrahams, 2008], which stands for the difficulty in prediction of the future success of a new talent in a position.
Devotion. Two Russian companies that belong to the power industry (R1, R2) stated that talent for them is loyalty, either to company or to profession, which can be explained by the nature of the industry having an extremely difficult production cycle.
It could be seen that foreign companies tend to be more strategic in their approach to define talent. Only MNCs use such terms as "potential" and "learning agility", which are aimed at future performance of talents, and not their current state [Jooss, McDonnell, Burbach, 2021]. This result also corresponds with the findings of [Latukha, Tsu-kanova, 2013], where MNCs representatives consider talent as potential. This statement is supported by the fact that strategic talent attraction was mentioned only by three multinational companies (M16, M17, M18), while representatives of Russian companies did not show any signs of it. A respondent from a pharmaceutical company M16, demonstrated a perfect example of a talent attraction strategy:
"We outline a strategy for attracting talent in advance, we are expanding the talent pipeline. We begin to work out the labour market in advance, we analyse competitors that may have such people".
On the contrary, for local companies it is typical to consider devotion and the whole workforce as talent, which is inconsistent with talent segmentation as a method of improvement of talent management efficiency and focus on pivotal positions [Lepak, Snell, 1999; Boudreau, Ramstad, 2005]. Both local companies and MNCs put to practice the resource-based view, considering talents as the key employees able to perform at the most crucial roles in a company.
Policy level of talent attraction. On what talent pools do local and foreign organizations rely while attracting talents? Overall, three types of talent pools were defined, and the level of their stability varied from total reliance on internal talents to orientation towards only external labour market (Table 3).
Focus on internal talent pools. Both Russian companies and MNCs, from various industries (pharmaceutical industry, transportation, power industry, FMCG (fast-mov-
ing consumer goods)), are focusing on attracting and developing talent from within. A respondent from a Russian power company (R1) shared a statistic that 100% of talent from the personnel reserve get pivotal roles:
"We have a very long career step, and there are not so many positions in which we can promote. The main indicator of talent management effectiveness is promotion. Since management drives us into such a framework, we assign to the talent pool only those employees whom we will promote".
Table 3. Types of talent pools used by local companies and MNCs
Type of talent pool For which companies the type is typical? Respondent's quote
Internal talent pools Both Russian companies and MNCs Nurturing and developing our own employees is the main priority. If we talk about the long-term strategy, in the future there will be a total refusal from attracting talents from the external labour market (Interview M15)
External talent pools MNCs We focus on attracting completely new skills for the company, both soft and hard ones (Interview M8)
Both external and internal talent pools Both Russian companies and MNCs We realized that it is inefficient to rely solely on internal talent, or only on external talent. Everything must be balanced (Interview M8)
Focus on external talent pools. An opposite approach of talent attraction from the external labour market was demonstrated only by MNCs from consulting, automotive and pharmaceutical companies. A respondent from the automotive industry (M8) highlights that the cause of "buying" talents is derived from disruptive changes in the industry and the need for a completely different set of skills:
"It is not what we want, it is a necessity. The automotive industry is moving away from a traditional manufacturing paradigm, it becomes essentially digital, a car is turning into the code".
Focus on both external and internal talent pools. A balanced approach to talent attraction was found in both Russian and foreign-owned companies. A respondent from a Russian development company (R4), where talent management has recently been im-
plemented, stated that now the company focuses on both attracting external talents and improving the learning and development system:
"At the moment, we are actively expanding. Unfortunately, the company is developing faster than the staff at the moment. Therefore, in terms of attraction, external hiring now dominates, but we strive to develop internal employees. We have training, and they are on a very good level".
These results indicate not only typical type of talent pools in accordance with capital ownership, but also give some insights into the influence of market situation on talent attraction. Moreover, only representatives of MNCs indicated the importance of attracting new skillsets because of the disruptive changes on the market, which was not true for local companies. In addition, it was revealed that local companies have no unique methods of managing talent pools.
These results contribute to the resource-based view in the following way. Companies should not only focus on talent characteristics, but also effectively manage risks from demand and supply sides of talent attraction and choose the most relevant talent pools in accordance with the market situation.
Practices' level. What practices of talent attraction are applied by HR specialists in accordance with talent groups in domestic firms and MNCs? In this section various talent attraction practices are explored in line with HR-architecture framework that posits the idea of application of various practices to different talent groups [Lepak, Snell, 1999]. Using talent segmentation paradigm, talent attraction practices would be compared withing three talent groups: young talents, talented specialists and talented managers, because organizational levels being the most widely used employee classification form [Miles, Patrick, King, 1996; Rice, Shook, 1990].
Young talent attraction. A remarkable number of studies is devoted to the problem of new generations at work and the managing of young talents [Terjesen, Vinnicombe, Freeman, 2007; McCracken, Currie, Harrison, 2016; Muratbekova-Turon, Kabalina, Festing, 2018]. The most popular practice of young talent attraction in local companies are events at universities and events at companies, with nine and five companies using them respectively. As for MNCs, social media was the most widely used practice, eight organizations implemented it successfully. Interestingly, Russian respondents (M9) did not mention using the employer brand as a complex attraction practice, while four international companies used it successfully:
"Speaking about our attraction strategy, we focus on creating a very cool employer brand. Indeed, our attraction campaigns are recognized by the world community as one of the best ones".
That could be explained by the fact that marketing practices in talent management is quite a new field, and they come from international companies. Thus, local companies may have already had some accomplishments in employer branding, but they do not use this particular term. Both groups of companies also successfully implement such talent attraction practices as job boards and internships.
Attraction of talented specialists. Turning to the attraction of talented experts, both local companies and MNCs use job boards and social media most frequently, with eleven and twelve cases respectively. Eight Russian and eight multinational companies implement referral programs as an attraction practice. Recruitment agencies were implemented only in two MNCs and in one local company, which contradicts with the finding of [Novitskaya, Brewster, 2016], who state that foreign subsidiaries prefer to use this tool. Actually, foreign companies try to build complex talent attraction systems within the company (M7):
"We do not work with recruitment agencies; we attract candidates with our own resources. We have our own departments for executive search and we use all practices, which agencies usually implement".
Some companies consider the largest Russian job board Headhunter, to be the most efficient attraction channel for talented specialists. For example, a respondent from a large company (M14) that produces and sells appliances shares such an observation: "If we are talking about external attraction, then we close 90% of vacancies using Headhunter".
On the contrary, a Russian IT company does not use open resources at all due to the fact that it is difficult to engage a successful talent into a conversation about changing a job (R8):
"We often find guys with an expert search. We do not use job boards. Because the stronger the expert, the better his life and career are, and it is more challenging to encourage him to talk and even to think about changing job".
Attraction of talented managers. Moving on to the attraction of talented managers, social media, especially LinkedIN, is the most frequently used practice for both, Russian companies and MNCs, with seven and twelve cases of implementation respectively. The second most popular attraction tool for managers is referral programs, eight local and five foreign firms applied it successfully. Although this practice is used quite widely in both groups of companies, one respondent from a pharmaceutical company (M15) highlighted its drawback:
"In our referral program we accept candidates whom we are supposed to know better than we know an applicant from the external labour market. So the level of attentive-ness to them decreases because of the psychological factor. And often we hire those candidates, who then go on to demonstrate a low work performance". The pattern of refusing to work with recruitment agencies is also seen in the attraction of managers. Three companies decided to reduce contracts with them in terms of the attraction of managers and established internal executive search departments, which contradicts with the findings of [Novitskaya, Brewster, 2016]. It could be explained by the fact that companies are eager to bring attraction expertise inside of the company and grew high-level talent acquisition managers from within. Overall, the frequency patterns of the usage of external attraction practices could be observed in Table 4.
Table 4. Frequency analysis of talent attraction practices in accordance with talent categories
and capital ownership
Talent category Talent attraction practice Frequency of talent attraction practices usage
Russian companies MNCs
Young talents Events at universities Often Often
Events at companies Sometimes Often
Social media Sometimes Sometimes
Employer brand Never Rarely
Talented specialists Online job boards Often Often
Social media Often Often
Referral programs Sometimes Sometimes
Recruitment agencies Rarely Rarely
Industry platforms Rarely Rarely
Talented managers Social media Sometimes Often
Referral programs Often Sometimes
Recruitment agencies Rarely Rarely
Notes: "often" — applied in more than 20 companies; "sometimes" — applied in 10-20 companies; "rarely" — applied in less than 10 companies.
It could be seen that social media is the only practice that is widely used for the attraction of talent across all categories. Interestingly, no radical changes in the set of applied practices in accordance with capital ownership could be seen in the frequency analysis. In view of the resource-based view, it means that Russian companies could adopt foreign talent attraction practices in order to use them as a source of competitive advantage. However, the absence of unique talent attraction practices could prevent local companies from capitalizing their employer brand. The set of talent attraction practices varies in accordance with the talent groups, which also reflects the presence of their segmentation in line with the resource-based view. For example, events are more popular with young talents attraction, while job boards and social media with experts.
On the contrary, talented managers are attracted via social media and referral programs. In other words, the results support the segmentation of talent attraction practices in accordance with talent groups [Lepak, Snell, 1999; Calle-Duran, Luz Fernandez-Alles, Valle-Cabrera, 2021].
In order to make the results more evident, the illustration for talent attraction systems comparison was outlined (Table 5).
Table 5. Comparison of talent attraction systems used by local companies and MNCs
Level of talent attraction systems Differences in talent attraction systems Similarity in talent attraction systems
Russian companies MNCs
Strategic level: talent definition Workforce, devotion Learning agility, potential Competencies, pivotal positions
Policy level: type of talent pools — External talent pools Both internal and external talent pools
Practice level Young talents — Events at universities and companies, social media
Talented specialists Online job boards, social media, referral programs
Talented managers Social media, referral programs
Note: "—" means the absence of the differences in talent attraction systems.
In Table 5 we can observe the differentiation of talent attraction practices in accordance with the talent group, made in line with the HR architecture framework, as well as the comparison of talent attraction systems in local companies and MNCs, which enlarges the resource-based view of talent attraction. From the table it could be seen that local companies' talent attraction systems differs from the MNCs only in terms of the strategic level, and there is no unique approach in choosing talent pools for talent attraction at the practice level. It could be also noted that MNCs are more strategic in building their talent attraction systems because of defining talent as potential (focus on future performance) and dealing with external talent pools in order to bring new competencies to the companies. In other words, the strategic orientation of talent attraction systems of MNCs gives them a long-term competitive advantage over local companies.
conclusion
The analysis of thirty three expert interviews allowed to explore various talent attraction systems and to outline some similarities and differences in them in MNCs and domestic companies, which allowed to find the potential for the competitive advantage improvement. It was also clarified, how companies differentiate attraction practices for talent groups in accordance with the HR architecture framework via the resource-based view.
On the strategic level of talent attraction systems, both Russian and multinational companies define "talent" as pivotal positions and sets of competencies, which shows active usage of the resource-based view in defining talent [Holland, Sheehan, De Cieri, 2007; Boudreau, Ramstad, 2005]. However, only MNCs interpret talent through the concepts of potential and learning agility, which corresponds with the findings of [Latukha, Tsukanova, 2013]. It means that Russian organizations pay more attention to stable concepts of talent, and it can be interpreted as a reflection of a low ranking for future orientation in terms of national culture [Latukha et al., 2020]. On the contrary, MNCs tend to be more strategically oriented in building their talent attraction systems.
Turning to the policy level of talent attraction systems, both Russian and multinational firms used internal talent pools or internal plus external ones. Interestingly, only some MNCs relied solely on external talent pools. This finding can be explained by the fact that some local companies still implement the concept of a Soviet cadre reserve, which is focused on stable succession planning and "growing" talent from within [Latukha, 2018]. In the long term, such a strategy can lead to both missing talented candidates from the external labour market and inability to quickly respond to changes. On the contrary, many MNCs operate in fast-changing conditions, and they actively "borrow" talent from external pools in order to acquire new competencies.
As for the practices level of talent attraction systems, no variation regarding capital origin was found. It could be explained by the fact that HR specialists circulate between various companies, introducing to them their experience gained in other firms and even countries. The segmentation of talent attraction practices in accordance with talent groups was also revealed that supports the concept of various HR architectures within one company [Lepak, Snell, 1999].
Finally, it could be concluded that both local firms and MNCs are equally equipped with a set of talent attraction practices. However, some foreign companies use them strategically to construct external and internal talent pools, which helps them to react to disruptive changes inside and outside of the company, maintaining a competitive advantage. Another finding being that none of the local companies demonstrated the presence of a clearly articulated talent attraction strategy, which can be explained by the low maturity level of talent management in Russia.
Turning to theoretical contribution of the current study, it enlarges the resource-based view on talent management, applying the HR architecture framework, and shows how firms differentiate talent attraction practices for various talent groups for improvement of a competitive advantage [Barney, Wright, 1998; Lepak, Snell, 1999]. This study
also it explores talent attraction as a system, dividing it into strategic level, policies and practices, providing a comparative study of talent attraction practices in local companies and MNCs [Gurkov, 2016].
The results of the current study will be of a particular interest to representatives of local firms and MNCs and would help the latter to understand trends in talent attraction in Russia [Skuza, Scullion, McDonnell, 2013]. Starting with the strategic level of talent attraction, local companies should focus more on the strategic orientation of their talent attraction systems, and to revise or outline talent attraction strategy. It would be also worth considering the revision of talent definition and matching it to talent attraction strategy, because all further activities would be targeted at that particular talent group.
Turning to the policy level of talent attraction, for both local companies and their foreign counterparts that operate in unstable environment it may be beneficial to orient themselves on attracting talents from external talent pools. It will enable firms to acquire new skillsets that are not presented in their companies and to improve their competitive advantage. Domestic companies that rely only on internal talent pools might also attract talents from external labour market, which will allow them to proactively respond to challenges of both internal and external business environments.
As for the practices level of talent attraction, for local companies it would be worth to outline unique talent attraction practices that would differentiate them from MNCs. HR experts may also update or create the employer value proposition of their companies, which will contribute to the improvement of the competitive advantage. Overall, implementing talent attraction as a system (with strategy, policies and practices) and segmentation of attraction practices in accordance with different talent groups would enable HR managers to improve the firms' competitive advantage in line with the resource-based view [Boudreau, 1991; Lepak, Snell, 1999].
In view of the qualitative design of the research, it is not possible to statistically outline which talent attraction practices were used more frequently at the statistical level, so the study describes only the identified trends. In this paper there is a limited regional coverage, and its results cannot be transferred to all business organizations in Russia, since the survey involved only the city of Moscow. Moreover, the results of the study may not be relevant for talent attraction in other national contexts.
The study could be considered as the basis for further quantitative and qualitative longitudinal studies that will establish significant relationships between the use of talent attraction practices and industries, capital origin as well as various talent groups. Also, a promising continuation of this study is the expansion of the coverage of talent management practices (selection, adaptation, development, reward, appraisal, and retention) for empirical verification of the existence of differences depending on capital origin.
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Received: May 28, 2021 Accepted: November 2, 2021
Contact information
Alexandra S. Osipova — Postgraduate Student; alexandra.osipoffa@gmail.com
в одинаковой ли степени российские и международные компании готовы Бороться за таланты в россии?
А. С. Осипова
Национальный исследовательский университет «Высшая школа экономики», Российская Федерация, 101000, Москва, ул. Мясницкая, 20
Для цитирования: Osipova A. S. 2022. Are local companies and multinational corporations equally equipped to struggle for talents in Russia? Вестник Санкт-Петербургского университета. Менеджмент 21 (1): 105-130. http://doi.org/10.21638/11701/spbu08.2022.105
Российские и международные компании часто применяют различные практики привлечения для найма талантливых сотрудников с целью сохранения конкурентного преимущества. Несмотря на важность привлечения талантов для успеха бизнеса, в научной литературе явно недостаточно исследований на тему о том, как российские и международные организации ведут «войну» за талантливых работников на российском рынке труда. В статье рассматриваются сходства и различия в системах привлечения талантов российскими и зарубежными компаниями, оперирующими на территории России, которые дают им конкурентное преимущество. В основе исследования лежит качественная методология: данные были собраны с помощью 33 глубинных интервью с HR-менеджерами и затем проанализированы при помощи программы NVivo 12. В результате анализа выявлено, что и локальные, и международные компании обладают одинаковым набором практик привлечения талантов на операционном уровне. Однако лишь некоторые иностранные компании используют стратегический подход к привлечению талантов и внедряют практики для создания внешних и внутренних пулов талантов, что помогает им быстро реагировать на резкие изменения внутренней и внешней организационной среды. Статья вносит теоретический вклад в существующие исследования. В ней развивается ресурсный подход к управлению талантами путем применения концепции HR-архитектуры и
рассматриваются дифференцированные практики привлечения для различных групп талантливых сотрудников с целью усовершенствования конкурентного преимущества организаций. Кроме того, привлечение талантов анализируется как система на уровне стратегии, политик и практик с целью выявления сходств и различий в российских и международных компаниях.
Ключевые слова: управление талантами, привлечение талантов, рекрутмент, таланты, ресурсный подход.
Статья поступила в редакцию 28 мая 2021 г. Статья рекомендована к печати 2 ноября 2021 г.
Контактная информация
Осипова Александра Сергеевна — аспирант; alexandra.osipoffa@gmail.com
APPENDIX
INTERVIEW GUIDE "TALENT ATTRACTION SYSTEMS"
Introduction (2 minutes)
Explanation of the interview technique, requirement for permission to record the interview.
Part 1. The current professional status of the respondent and the general description of the employer company (10 minutes)
1. How can I address you? How old are you? Where do you work?
2. Please, tell me about your company and its industry. How many years does it operate on the market? What kind of services and products does it offer? How many people work in your organization?
3. Is it a foreign-owned or Russian-owned company?
4. Tell me about your employment history. How long have you worked? What positions did you hold?
5. Tell me about your current position in the company. How long have you been with the company? What kind of position do you hold? What are your professional responsibilities?
Part 2. Talent management system in the employer company (5 minutes)
6. How could you describe your company's talent management strategy?
7. Describe the talent management system of the company. What elements does it consist of?
Part 3. Talent attraction system in the employer company (15-20 minutes)
Strategic level
8. How is the term "talented employee" is defined in your company?
9. What categories of talents are defined in your organisation?
10. How would you describe the company's talent attraction strategy? Policy level
11. Let us talk about talent attraction in your organization. Please describe the talent attraction process
12. Which talent pools do you target when attracting talent? Practice level
13. What practices do you use to attract talent? Which channels?
14. How do these practices vary depending on the talent group (young talents, specialists and managers)?
