LITERATURE REVIEW - Career Development of Management Associates in Banking Sectors in Taiwan

This chapter provides the relevant previous literature review. This chapter is divided into three sections: (1) management associate program, (2) career development, (3) career choices.

The first section covers definition and contents of management programs, characteristics of management associates, and an overview of banks implementing MA programs in Taiwan.

The second section is career development, included the definition of career, career development, super’s theory and career stage. The third section covers the definition of career choices, Holland’s vocational choices, the factors affecting career choices and theory of work adjustment.

Management Associate Programs

In the rapidly changing business environment, businesses need to have a flexible and high-quality talent pool to keep their competitive advantage (Dries & Pepermans, 2007).

There are many ways for organization to cultivate their own future leader and implementing management associate programs is one of those ways. Potential assessments are used to find out high-potential individuals. After that, organizations give them training to ensure they are ready to fill the management positions when the positions are open. Nowadays, many organizations, regardless of industries, have widely used this way to cultivate their future leaders in the last few years.

Definitions

According to website of Citibank Taiwan (2011), management associate program is a development program designed for high potential individuals. Developmental programs, one of career management activities, make high-potential employees learn new ideas and skills (Werner & DeSimone, 2008). These developmental programs consist of “job rotation, in-house HRD programs, external workshops and seminars, tuition assistance and reimbursement plans and mentoring programs.” (Werner & DeSimone, 2008) High-potential

individuals can obtain knowledge, skills and abilities for the future management positions through these training activities.

Management associate programs can also be called high-flyer programs, fast-track programs, high-potential programs and talent management programs in academic field. These terms can be used interchangeably. Although the words are different, they have the same meaning. High-flyer or fast-track program is” a systematic method to socialize, develop, and screen a group of employees who have been identified as having potential for quick promotion to top-management positions.” (London, Weinstein, & Raghuram, 1998) High potential identiﬁcation and development or talent management means organizations put emphasis on the development of those who have high leadership potential and providing various training courses for those chosen talents to ensure that organizations have well-prepared employees who have enough abilities to achieve companies’ strategic objectives (Hausdorf, 2007). Overall, management associate program is a well-designed training program for potential employees to learn and develop quickly. If organizations want to keep their long-term competitiveness, they should do their best to develop and retain these high- potential individuals (Berke, 2003).

Management associate program is always seen as a selection tools by businesses for finding their future leaders (Feild & Harris, 1991). The programs always focus on the fresh undergraduate students or newly-mint MBAs (Kets de Vries & Korotov, 2007). For example, HSBC has operated this kind of program, targeting at graduates and hire them into international management cadre, for a long time. These graduates are viewed as future global managers and they have opportunities of directing development towards this group (Jenkins, 2010).Similarly, Price water house Coopers (PwC) has an ‘‘emerging leader’’ strategy, which is also used to find talent and fast tracks high-potentials’ development (Woollard, 2010).

In addition, there is the other way to executive the management associate program,

aiming at developing senior specialists (London et al., 1998). Many companies rely heavily on the use of direct supervisors to identify HIPO talent based on actual job performance, rather than using a list of attributes or assessments of future potential (Burke, 1997).

Organization views the top performers as the future leaders and gives them special trainings.

General Electric (GE) has a plan, called” Session C”, to identify the top performers in its organization and gives them special training (Woollard, 2010). In this situation, companies should consider whether to inform HIPOs their status or not. Most companies prefer to keep it secret because it is more flexible to take individuals on and off this list (Burke, 1997).

Moreover, there is a typical belief that high potentials will become arrogant and complacent when they are informed of their status (Go¨bel-Kobialka, 1998).

Procedures for Management Associate Programs

The procedures of carrying out this program consist of training need assessment (Patton

& Pratt, 2002), design (Burke, 1997), selecting, developing them, and then actually going through the leadership succession process (Derr, Jones, & Toomey, 1988 ).

Training need assessment can be divided into two aspects: organizational and individual.

Through this step, organizations can know which trainings they should provide for employees (Patton & Pratt, 2002) and then make the effectiveness of development actions maximize (Byham, 2001). Need assessment can be done by several tools, including interviews, pencil-and-paper-tests, 360 degree multi-rater surveys and acceleration center (Byham, 2001)

.

The second step is design a management associate program, including determining HIPO criteria, a communication strategy, and creating a program evaluation mechanism (Burke, 1997). In the designing process, designers should decide selecting criteria, such as

education, work experience, etc. Harris and Feild (1992) suggested companies should communicate their goals of programs with the line managers if they want to maximize programs. Hence, communication of program objectives plays an essential role on the success of program. In addition, designers also should use an appropriate evaluation system to see whether the program meets corporate objectives or not.

The third step is selecting. Management associate identification is a hierarchical initiative. The selecting process is dominated by top management and the immediate supervisor, and sometimes initiated by the HR department. The selecting methods, such as performance appraisals and specific potential assessment procedure, are widely used by corporate (Pepermans & Vloeberghs, 2003). Candidates get high-potential labels should go through several tests. All organizations want to get the best people; as a result, they design a series of selection process. Take Taiwan Citibank for example, the first corporate to implement MA program in Taiwan, the process of interview consists of four stages. Stage one is application screening. Stage 2 is interview with human resources professionals. Stage 3 includes presentation, interview with Citibank managers and senior human resources professionals. The last stage is case study and panel interview with Senior Management Team.

If MA applicants can go through four stages recruitment process, they are formal MAs.

Because of going through many stages of interviews and tests and low acceptance rate, the selected person must be very outstanding. Organizations always use assessments to identify whether the person should have some specific characteristics to be a future leader. A research showed that the characteristics of management associates might include “teamwork, performance motivation, delegating leadership, cogency judgment creativity, company identification, flexibility, vision, integrity, cultural difference awareness, risk taking, and ability of giving feedback (Pepermans & Vloeberghs ,2003).”

The fourth stpe is develop selected employees. Kuznia (2004) indicated that the development process consists of four parts: job rotation, special assignments, coaching and mentoring, and specific skills training.

Job rotation means employees have lateral moves among different positions and learn different skills and responsibilities within different tasks (Huang, 1999). It helps MAs to obtain a macro view of corporate (Zielinski, 2006) and also a formal effort at executive development (Beatty, Schneier, & McEvoy, 1987). Furthermore, it also makes participants to understand different organizational functions and build network within organizations (Werner

& DeSimone, 2008).

The second element in MA program is coaching and mentoring, which means “working with a senior member of the management team in an organization.” Senior employees will share their past experience with newcomers (Peterson, 2002). The function of mentoring can be divided into three parts: vocational or career coaching, social support, and role modeling (Scandura, 1992). Bloch (1995) said more and more organizations found that one-to-one coaching and mentoring are very useful methods in developing soft skills. As a result, they are included in the development programs.

The third composition in MA program is special assignments. McCall (1998)defined it as “discrete and temporary assignments to work on issues facing an organization.”

Assignments consist of installing a new system, negotiating agreements with suppliers, or learning about new products or processes within the organization or industry (McCall, 1998)

.

Organizations want MA to experience pressure and learn team-building, planning, and organizing (Heisler & Benham, 1992).

The fourth element is specific skills training. Skills consist of hard skills and soft skills.

Hard skills means skills needed to complete tasks, such as technical or administrative procedures. Soft skills also can be called people skills are skills which are needed to executive hard skills effectively. Examples includes “communicating, listening, engaging in dialogue, giving feedback, cooperating as a team member, solving problems, contributing in meetings and resolving conflicts (Coates, 2006) .” Through skills training, high potentials’

abilities can develop and their perspective can be broadened. There are many methods to do specific training, such as in house seminars and non-degree short courses. Because of the increasing importance of international aspects of business and managing change, organizations always provide courses about leadership, strategy and cultural change for them (Kuznia, 2004).

The final steps is that these candidates actually in the leadership positions. Derr et al.

(1988 ) said those who can finally in the six to twelve positions at the top of the hierarchy are clearly qualify as high-level leaders.

Characteristics of Management Associates

Those participates in management associate programs are management associates (MAs), which can also be called as “high potentials (HIPOs), stars, fast-trackers, and corporate property.” (London et al., 1998) High potentials, with different needs, motivations, and behaviors (Pepermans & Vloeberghs, 2003), are those who are considered as future leaders at that time (Dries & Pepermans, 2008). Because most management associate programs always focus on the on the fresh college graduates or newly-mint MBAs (Kets de Vries & Korotov, 2007), these individuals are usually young. Their career paths are carefully monitored by organizations and they usually receive special coaching and mentoring. They are often given high exposure positions and assigned projects with senior management when they enter

companies. (Pepermans & Vloeberghs, 2003) Organizations see them as a critical elements for organizations in the future survive (Pepermans & Vloeberghs, 2003) and indispensable to organizations (Boudreau & Ramstad, 2005). As a result, organizations will invest heavily on them than other employees, and expect their return and contribution (Baruch & Peiperl, 1997).

Although they have more opportunities to promote and special trainings, they still meet many difficulties, such as completing short-term assignments and facing great stress for outperforming. The status of management associates is not permanent; as a result, they should maintain this status by outperforming constantly (Hausdorf, 2007).

An important feature of high potentials is they have more traditional career paths for having more opportunities to move up the corporate ladder than regular employees (Dries &

Pepermans, 2008). Although the style of employment differs between past and now, it seems that high potentials still have traditional career path. In the past, organizations provide long-term employment contract and offer employees security and slow promotion.

High-potentials have special status to have rapid promotion in organizations (Iles, 1997).

Career development is seen as an upwards and hierarchical progression. However, because of organizational restructuring, downsizing, outsourcing, and delayering in recent years, the employment contract and psychological contract are changed. Viney, Adamson, and Doherty (1997) indicated that the new employment style is no longer vertical progression. The new deal contact focus on personal development rather than promotion quickly (Larsen, 1997).

High potentials get fewer guarantees to promote to the management positions in the future.

As a result, the advantage of HIPOs who have more opportunities to promote was questioned.

However, Dries and Pepermans (2008) suggested that high potentials are still getting “the old deal” as they are promised long-term career perspectives and upward advancement. Although many organizations do face the scarcities in promotional opportunities, they overcome it by setting stricter high-potential identification criteria and further segmenting the high-potential

14 population.

Management Associate Programs in Taiwan’s Banking Sector

Citibank is the first one to implement this program in Taiwan financial industry, having implemented it over 30 years. By 2005, many banks in Taiwan began to put management associate programs into practice. The following table (Table2.1.) provides an overview of banks which have the MA program.

Table 2.1.

An Overview of Banks Having MA Programs

Bank Name Program Name

Citibank Management Associate Program

HSBC Young Banker Development Program

Standard Chartered International Graduate Program Fubon Financial Holding Management Associate Program E.Sun Financial Holiding Management Associate Program China Development Financial Holding Management Associate Program

China Trust Management Associate Program

Cathay United Bank Cathay Management Associate Program TaiShin Financial Holding Management Associate Program

Cosmos Bank Executive Trainee Program（ETP）

First Bank First Bank MA Program

Taiwan Cooperate Financial Holding Management Associate Program Hua Nan Financial Holding Management Associate Program Mega International Commercial Bank Management Associate Program Far Eastern Commercial Bank Management Associate Program

Chang Hua Bank Management Associate Program

Career Development

Belet (2007) indicated that special management development programs providing for high potentials focus on “strategy skills, analytical tools and methods, case studies, consulting missions, organization development, traditional leadership skills development.” It means that these potential training opportunities can aid in the employee development.

Definition of Career

Before discussing career development, it is important to clarify what career implies. The definition of career differs for covering different scopes. The narrow sense of career means the sequence of work-related, occupations, and experiences encountered by individuals. For example, Super (1957) defined careers as “the sequence of changes in occupational level or field made by an individual during his or her working lifetime.” The traditional definition restrict career to a professional work life.

However, some researchers proposed that the concept of time should be broadened. The broaden definition of careers include prevocational and postvocational activities, decisions, and other life role and contents (Schutt & Schutt, 2007). For example, Super (1976) defined careers as “the sequence of major positions occupied by a person throughout his preoccupational, occupational, and postoccupational life; includes work related roles such as those of students, employee, and pensioner, together with complementary vocational, familial and civil roles.” Career denotes a subjective construction that imposes personal meaning on past memories, present experiences and future aspirations by weaving them into a life theme that patterns the individual’s work life (Brown & Lent, 2005). Career consists of three dimensions: time, vocation/occupation, and roles (Wu, 2010). EL-Sabaa (2001) defined a career as “an evolving sequence of work activities and positions that individuals experience

over times as well as the associated attitudes, knowledge and skills they develop through their life.”

In this study, the definition of career stated by EL-Sabaa (2001) is used for guideline because it refers career as not only a job but also a process that develop attitude, knowledge, and skills to achieve the set goals.

Definition of Career Development

Career development, one aspect of human development (Gysbers & Moore, 1975), is a complex process. Some theorist said that career development involves individuals choose their career over life. For example, Brown and Brooks (1990) indicated that career development is a lifelong process involving “choose, choosing, and continually to make choices from available occupations in our society.” However, some theorist think career development is not only occupation-related but a process by which the individual develops beliefs, values, skills, aptitudes, interests, personality characteristics and knowledge of work (Zunker, 2006). Sears (1982) indicated that it is an ongoing and life span process. To sum up, career development is part of lifelong learning, in that personal and vocational skills constantly change and expand during a lifetime in response to career changes and emerging opportunities.

One’s career development will be affected by organizational and individual activities.

These activities can be referred to as career planning and career management (Werner &

DeSimone, 2008). Career planning involves vocational choices, organizational choices, and self-development（Glueck & Milkovich, 1982）. Through career planning, individuals can know what they want and how they attain their goals. Career management includes activities which can help employees to carry out their career plans, such as rewarding, assessing, training and developing（ Glueck & Milkovich, 1982 ） . These activities are mainly

implemented by organizations. Werner and DeSimone (2008) indicated that six categories of career development activities at large organizations: self-assessment tools, individual counseling or career discussions, internal labor-market information exchanges, job matching systems, organizational potential assessment processes, and development programs. This study focuses on how development programs influence employees’ career development.

Career Development Theory

Career development theories differ in their coverage of the career development process versus career decision-making content (Niles & Harris-Bowlsbey, 2008). Before 1950s, career development focused on the career choice and put emphasis on how to connect personal traits to work requirements (Kuo, 2009). For example,

Parsons (1909) proposed the root of career development theory: trait-and-factors model. He indicated three factors of choosing career:

(1) a clear understanding of yourself, your aptitudes, abilities, interests, ambitions, resources, limitations, and knowledge of their causes; (2) a knowledge of the requirements, conditions of success, advantages and disadvantages, compensation, opportunities, and prospects in different lines of work; (3) true reasoning on the relations of these two groups of facts. (Parson, 1909, p.5)

After 1950s, the scope of career development was broadened. Many new theories merged, such as the work adjustment theory (Lofquist & Dawis, 1969), social learning theory of career selection (Krumboltz, 1979), a developmental theory of occupational aspirations (Gottfredson, 1981), social-cognitive theory of career decision making (Lent & Hackett, 1994), and value-based model of career decision making (Brown, 1996). New elements such as occupational satisfaction, success, culture, work value were added to career development theories (Brown, 2002).

Osipow (1990) analyzed four major sets of career theories: trait and factors, social

learning, developmental, and work adjustment. The following table (Table 2.2) provides an overview of career theories:

Table 2.2.

Overview of Career Theories

Theory Theorists Orientation

Work Adjustment Dawis & Lofquist (1969) Trait-and-factors, career choice /adjustment Life-Span, Life-Space Super (1957) Developmental Circumscription,

Krumboltz (1979) Social learning, Career choice development

Integrative Life Planning Hansen (1997) Contextual career choice/

adjustment

Note. Adapted from “Understanding and Appling Theories of Career Development,” by S.G. Niles and J. Harris-Bowlsbey. 2008, Career Development Interventions in The 21 st Century, p. 39-40. Copyright 2008 by the Pearson Education Publiciation.

Niles and Harris-Bowlsbey (2008) indicated that “Life-span and life-space” theory proposed by Super (1957) and “Vocational Personalities and Work Environments” theory provided by Holland (1959) has high research support.

Super’s life-span, life-space theory

Super’s “life-span, life-space” theory is the mainstream approach to discuss how career develop (Super, Super, & Savickas, 1996). Super (1990) defined career development as “ a

dynamic, longitudinal, and development process essentially consisting of developing and implementing the self-concept.” His theory was composed by three key elements: (1) self-concept; (2) life-space; (3) life-span.

Life span, life-space theory is built on 14 propositions proposed by Super (1990). There are three propositions discuss people have different abilities, values and personalities and they are qualified by different occupations. There are six propositions focus on the self concept. Self-concept is a “picture of the self in some role, situation, or position, performing some set of functions, or in some web of relationships.”(Super, 1963) People will construct their self-concept as a result of individuals interacting with their environment. Self-concept contains two elements: objective and subjective. Objectively, when we compare ourselves with others, self-understanding is constructed. Subjectively, we construct self-concept when we focus on our uniqueness emerging out of our life experiences (Niles & Harris-Bowlsbey, 2008). Both objective and subjective understanding can guide us during career-decision process. The changing of self-concept is a successive process not just at one point in time.

Two propositions pay attention on career maturity. Career maturity means that the readiness, attitude and competency people have to cope with tasks of career development. The final

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