Research Background
In today’s fast changing business environment, the organizations have to face a more fierce competition with other competitors. The challenges modern organizations face including competing in crowded global markets, producing shareholder returns during economic downturns, changing technology, etc. One of the most effective ways to overcome these challenges is to have top talented employees in hand (McDaniel & D'Egidio, 2009). These talented employees who possess strategic competences, and the ability which can help companies to achieve goals and maintain the competitive advantages are regarded as the top performing companies’ lifeblood.
(Avedon & Scholes, 2009; Berger, 2004; Chambers, Foulon, Handfield-Jones, Hankin,
& Michaels, 1998; Silzer & Church, 2009). Collins (2001) in his book mentioned that talented employees are the key for companies to continually grow up. Boudreau and Ramstad (2002) mentioned if an organization wants to succeed, to be competitive in capital market, customer and product market, and talent market are essential. Besides, according to the “Top ten risks for business” reported by Ernst & Young in 2010, talent management (TM) was listed in the fourth place following regulation and compliance, access to credit, and slow economic recovery. In 2009 TM was in the seventh place in this report (Ernst & Young, 2010). The continued increase in ranking shows the importance and impact of talents and TM to companies’ operation is getting critical.
However, the situation for most companies is not optimistic since the competition for talents is getting fiercer recently. Avedon and Scholes (2009) noted that the demand for talent is much higher than the supply. Kidd (2011) recently
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mentioned in Forbes magazine that companies now find they are not only in a fierce competition for customers but also talents. In a talent shortage survey, 54% of Taiwan’s employers report having difficulties filling job openings since there is a shortage of available talents. Compared to the global average of 34%, Taiwan obviously is struggling with the problem of talent shortage (ManpowerGroup, 2011).
Because of the unbalance of demand and supply for talents, the top group of talents will have several choices and opportunities in different positions at the same time (Avedon & Scholes, 2009).
Since McKinsey brought up the concept of the war for talent (Chambers et al., 1998), the term, TM, has been widely discussed by both practitioners and scholars.
There are tons of literatures and articles discussing the issues about TM. However, the outcomes and results are scattered. TM does not have a clear and shared definition, scope, and overall goals for companies to take as references (Garrow & Hirsh, 2008;
Lewis & Heckman, 2006). Furthermore, there is a shortage of research that has a deep exploration to the TM strategies and practices of companies in Taiwan with different backgrounds. TM practices and its definition of talent vary from different companies which have different backgrounds. If TM is successfully aligning with business strategies, the definition of TM for organizations might change accompanying the strategy. In this regard, a companies’ innate character and background will affect the TM definition and practices. Nationality of the companies might be one of the most dominant factors which will result in different TM strategies since the difference of human resources management practice actually exists in local companies and FDI companies (Yang, 2004). In response to the perspectives above, in this study, the nationality of companies is used to segment and clarify the current status of targeted companies. The researcher used a qualitative method to explore the TM strategies and practices and consolidate varied TM
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practices from different companies. The alignment of TM functions and business strategies are discussed during in-depth interviews. The expected outcomes of this study can be the references to help companies to define TM and establish TM strategies, and then resolve the problems of talent shortage.
Research Purpose
The purpose of this research is to understand the definition, strategies, differences, and practices of FDI and local companies.
Research Questions
The following research questions will be proposed based on research purpose:
1. What is the definition of talent and TM for the companies?
2. How do the companies align the business strategy with TM practices?
3. How do the companies integrate the TM relevant functions?
4. What is the role HR, line manager, and high level managers play in TM?
5. How do FDI and local companies’ implement TM practices (talent planning, talent attraction, talent development, talent retention, and TM’s evaluation)?
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Definition of Key Terms Talent
Talent refers to individuals and groups who have the capability and strategic competencies to make a significant difference to the current and future performance of the company and to be the source of competitive advantage (Ashton & Morton, 2005; Avedon & Scholes, 2009; Chambers et al., 1998).
Talent Management
TM is an activity and process which combines HR strategy and business planning to help companies maintaining sustainable competitive advantage by reinforcing the HR functions to attract, identify, develop, and retain the talented employees (Avedon & Scholes, 2009; Collings & Mellahi, 2009; Mihelic & Plankar, 2010)
Foreign Direct Investment (FDI)
Multinational firm’s ownership, in part or in whole, of an operation in another country (Parboteeah & Cullen, 2011).
Local Company (Taiwan Based Company)
A company is listed in Taiwan stock market or its headquarters is located in Taiwan.
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Delimitations and Limitations
This study has several delimitations. This study focused on the TM practices, strategies and the alignment between TM functions and business strategies. The study adopted a qualitative method which includes in-depth interviews to get critical information to address the research question. The selected sample focused on FDI companies and local companies. In order to find the interviewees who have a clear understanding of their TM, this research hypothesized the HR manager is the one who knows their TM strategies and practices the most and invited them to be the interviewees.
In this regard, there are several limitations following the delimitations above mentioned. First, the scope of TM was too large, it was difficult to discuss complete materials of TM in one study. Second, since the resources and time were limited, the numbers of subjects might lead to information unsaturated in each category. Third, this study assumed that HR is supposed to be the one who has the deepest understanding of the organizations’ talent strategies, therefore the researcher selected HR managers as the samples. The limitation here was that HR managers may limit their perspectives pertain to HR experiences instead of the companies’ perspectives.
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