Project Management Institute

The search must go on

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ILLUSTRATIONS BY JOEL KIMMEL

 

THE RIGHT HELP WANTED

 

Faced with a global talent shortfall, industries worldwide are getting creative about finding and developing the team members they need.

BY SARAH FISTER GALE

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ILLUSTRATIONS BY JOEL KIMMEL

The global talent shortage has hit a seven-year high, and it’s having a serious impact on how organizations plan, manage and deliver their projects.

More than one in three global employers report difficulty finding candidates with the right skills to fill open positions, according to a 2014 ManpowerGroup survey of more than 37,000 employers in 42 countries. More than half of global employers experiencing a talent shortage say the dearth of talent hurts their ability to meet client needs.

PwC’s recent survey of CEOs found that 93 percent say they recognize the need to make a change to, or are already changing, their strategy for attracting and retaining talent. But there’s still an enormous gulf between intention and action: A staggering 61 percent of CEOs haven’t yet taken the first step. Only 23 percent of respondents in PMI’s 2014 study, Rally the Talent to Win: Transforming Strategy into Reality, believe senior leadership gives strategic talent management the priority it deserves. This is not surprising, as a minority of executives surveyed are actively involved in setting talent management priorities or in mentoring future corporate leaders.

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“It’s the most significant talent shortage we have seen in seven years, and it’s going to get worse.”

—Sean Costello, Experis North America, Milwaukee, Wisconsin, USA

 

The talent crisis is even more pressing for organizations looking for project management talent. Four in five organizations struggle to find qualified project practitioners to fill open positions, according to PMI’s 2013 talent report Building High-Performance Project Talent.

“It’s the most significant talent shortage we have seen in seven years, and it’s going to get worse,” says Sean Costello, the Milwaukee, Wisconsin, USA-based vice president of Experis North America, ManpowerGroup’s global professional staffing arm. “It’s preventing companies from meeting customers’ needs, it’s getting in the way of their ability to be innovative and it’s having a negative impact on team morale.”

Thirty-five percent of respondents to Rally the Talent to Win: Transforming Strategy into Reality, a 2014 Economist Intelligence Unit research program sponsored by PMI, report that talent deficiencies have significantly hampered more than one-half of their efforts at introducing and implementing strategy over the last three years.

Certain sectors, including infrastructure, energy and IT, have been particularly hard hit. In the energy sector, for instance, 58 percent of executives in the United States and Canada say they struggle to find the talent they need, according to Manpower. Three in four expect the problem to get worse in the next five years. Meanwhile, 60 percent of technology leaders say they lack access to the right resources—a 33 percent increase from 2013, according to Harvey Nash’s 2014 CIO survey.

“Companies that can’t find talent are at a real disadvantage in achieving their business goals,” Mr. Costello says.

While creatively filling short-term openings, organizations need to think more holistically and strategically about how to minimize talent shortages in the long term.

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CONSTRUCTION

The two employment fields that organizations have the toughest time filling both affect construction initiatives. Skilled trades, including ironworkers, masons and bricklayers, are the hardest jobs to fill, followed by engineering positions, according to Manpower.

“Unemployment is extremely low among qualified engineers, and we know when we find them they are probably fielding multiple offers,” says Chris Gould, the Overland Park, Kansas, USA-based director of global talent acquisition and mobility for Black & Veatch, a global engineering, consulting and construction company.

To manage its infrastructure projects around the world, Black & Veatch has to maintain a strong talent pipeline. That means recruiting people before projects start and making sure project managers have realistic expectations about the company’s ability to ramp up project teams in a timely fashion.

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“Unemployment is extremely low among qualified engineers, and we know when we find them they are probably fielding multiple offers.”

—Chris Gould, Black & Veatch, Overland Park, Kansas, USA

It also can mean bringing in talent from abroad. Black & Veatch is involved in a 10-year project to build South Africa’s Kusile Power Station—one of the largest infrastructure projects under construction in the world. Black & Veatch has had to relocate more than 200 expat engineers and project practitioners to South Africa to run it.

“Few of the locals have experience in the industry,” says David Leligdon, Kusile’s program manager, based in Overland Park, Kansas, USA. While bringing in foreign talent adds time and cost to the project, it guarantees that the team has the expertise it needs.

This strategy also works in the company’s favor when recruiting globally. “We can promise engineers and project managers opportunities to work around the world, develop expertise on multiple types of projects and move into leadership roles more aggressively than in smaller firms,” Mr. Gould says. “That resonates with younger professionals especially.”

TRAINING TALENT

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Eric Pepin, PMP, PgMP, is the human resources director at Ubisoft, Shanghai, China.

Power Up!

“I came to Shanghai as a project management director with the mandate to develop the current managers and develop local ones. Project planning methodology and risk analysis and reporting were not well-developed in Shanghai in 2006, and we had to develop a project management training program to ensure our managers had the right foundations.

In video game development, it’s not surprising to see a project manager who is 24 years old leading teams of 25 to 50 people. In big developments, it could easily be more than 400 people in different studios around the world. Project managers need to have the right tools to succeed in this kind of project organization. They need to be able to manage their team locally and also to ensure the right collaboration with studios abroad. It’s not always easy, and it’s a challenge on every project.

Our training has been developed to cover areas a project manager has to tackle, including waterfall, Scrum, developing a budget, business writing and more.

In our training, we try to use real-life scenarios so practitioners can relate to what they are learning. We use situations like managing a big ego, conducting efficient meetings, developing successful teams and giving negative feedback to an employee. For example, when you need to give negative feedback, start and finish with positive feedback to help the employee better absorb the comments.

Video games are evolving really fast. Before, when the game was launched on the market, the project was almost done. Now, with online games, we have to ensure we provide new content after the launch of the game. Project managers have to follow closely how players are reacting to the game and work with operations and marketing teams to keep the game attractive to players. That’s why the business and marketing training is important for our managers.

Part of the communication training is about confidentiality. Our teams are really passionate about the games they are working on, but if the game is not announced worldwide yet, we’ve had to remind some teams not to mention it in their LinkedIn profile.”

The Hardest Hit

These 10 locations are having the toughest time finding talent, as gauged by the percentage of employers reporting a talent shortage.

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Source: The Talent Shortage Continues, ManpowerGroup, 2014

However, attracting foreign project leaders is only half the talent battle, Mr. Leligdon says. Kusile, like most major construction projects, requires project leaders to hire a large number of local workers. “We try to hire locally for these projects, but that’s not always possible,” Mr. Gould says.

To overcome the gap, the organization holds skills training courses. It also provides extensive supervision on-site to quickly develop team members’ skill sets while reducing safety risks and minimizing mistakes. “It means our productivity levels may be lower than average,” Mr. Leligdon says. But because the project planners knew that would be a risk, they factored it into the schedule and risk assessment.

Even with proactive hiring and training programs, infrastructure project teams still face a constant challenge to attract and retain skilled labor, adds Ted Andry, Kusile’s project manager, Pretoria, South Africa. Positions sometimes go unfilled for extended periods, or the organization has to hire less-experienced team members to fill roles.

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“The core of what we do is find the balance between scope, costs and schedule. We have to find that balance, then maintain the best project staff we can to achieve success.”

—Ted Andry, Kusile, Pretoria, South Africa

 

That makes it all the more vital to have good project managers in place, Mr. Andry says. “The core of what we do is find the balance between scope, costs and schedule,” he says. Not being able to fully staff a project adds time to the schedule—and cost to the budget. “We have to find that balance, then maintain the best project staff we can to achieve success.”

ENERGY

The global energy boom has increased demand for experienced engineers and project practitioners around the world—and that demand is outpacing supply. The sector faces both an aging workforce and fewer interested and qualified entry-level job seekers, as well as rapid technological advances that are changing skills requirements, according to a 2014 Manpower report on the energy workforce.

That’s forcing organizations to pay more to lure skilled talent from competitors. Approximately two-thirds of oil and gas companies intend to fill the talent void by buying talent from outside their organizations, and nearly half of these same employers intend to use poaching from competitors as their predominant source for new talent, according to a Mercer survey. The talent crunch is also forcing organizations to recruit globally for more projects, and to build stronger training and mentoring programs.

Because the energy sector laid off much of its workforce during the oil crash of the 1980s, there is a huge gap in the talent supply chain, says Patrick Allman-Ward, PhD, CEO of Dana Gas, one of the Middle East’s largest private-sector natural gas exploration and production companies, in Sharjah, United Arab Emirates. Those laid-off workers moved to other industries, and for years no new workers took their place, he says. “So currently, there are very few workers in the 35- to 45-year-old age bracket.” That demographic of workers should now be moving into leadership roles as their mentors retire.

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Growing Concern

CEOs around the world are worried that the talent shortage and lack of available skills will affect business.

Extremely concerned Somewhat concerned

Not very concerned Not at all concerned

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Source: Annual Global CEO Survey, PricewaterhouseCoopers, 2014

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“We need to start focusing on using our baby boomer workers as mentors and not just to fill immediate project needs.”

—Patrick Allman-Ward, PhD, Dana Gas, Sharjah, United Arab Emirates

 

Keeping Up With Conditions

Global executives report that talent management strategies need to keep up with changing business conditions.

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Source: Rally the Talent to Win: Transforming Strategy into Reality, an Economist Intelligence Unit research program sponsored by PMI, 2014

The industry has been concerned about its talent gap for years, but according to Dr. Allman-Ward, who spent 30 years working at Shell Oil Company before moving to Dana in 2012, the situation didn’t get as bad as initially predicted because the global economic slowdown led many people to put off retirement. As more of them approach 70 years of age, the cushion of talent is disappearing.

Unfortunately, most oil companies failed to use these experts to mentor the next generation, says Dr. Allman-Ward. “We had a window of opportunity to make use of those senior team members to mentor the younger folks, but instead we used them to get the short-term work done,” he says.

The shortage of experienced project practitioners, engineers and skilled labor is putting pressure on capital projects, says Van Zorbas, principal, Deloitte Consulting, a PMI Global Executive Council member, Calgary, Alberta, Canada. Companies are being forced to pay more to attract top talent, which is impacting cost estimates, and they are seeing a lot more risk in terms of meeting deadlines, maintaining productivity and avoiding errors due to inexperience. “The costs aren’t just related to higher salaries,” he says.

Mr. Zorbas sees many oil companies being forced to get more creative about recruiting, pulling experts from other industries, like shipbuilding and construction. “It’s a very competitive marketplace,” he says.

To fill the talent gap in the long term, energy companies need to do more than borrow workers from other industries, Dr. Allman-Ward says. They have to invest in better talent development so they can build experts and keep them onboard. His company, Dana Gas, is implementing more mentoring programs and partnering young workers with more experienced staffers to strengthen their skill sets.

“We need to start focusing on using our baby boomer workers as mentors and not just to fill immediate project needs,” he says. “It’s a hard choice when you have projects that need leadership today, but it is the best way to secure our pipeline of talent for tomorrow.”

IT

Given the breakneck pace of tech innovations, organizations face the daunting challenge of finding skilled team members who can keep up. IT positions are the eighth hardest jobs to fill worldwide, according to ManpowerGroup.

“IT staff are in huge demand because of the rapid change in technology,” says Mr. Costello of Experis North America. “All kinds of companies need IT experts to help them remain competitive.”

The IT talent shortage is having an especially hard impact on the healthcare sector. As healthcare organizations race to roll out electronic medical records systems and other up-to-date technology, they are scrambling to find the talent they need. More than three-fifths of healthcare CEOs are concerned about the availability of key skills, and more than half say the speed of technological change threatens their organizations, according to a 2014 PwC survey.

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The offices of Fresh Tilled Soil, a user experience design company in Boston, Massachusetts, USA

PHOTO COURTESY OF FRESH TILTED SOIL

In addition to outsourcing, some organizations recruit abroad, yet handling visas and relocation issues can add months to a project’s timeline. Others lure talent from competitors with incentives and higher wages, but that can quickly become cost prohibitive.

Fresh Tilled Soil, a user experience design company, has taken a different approach. To minimize the impact of talent shortages, it built its own talent pool in-house through a custom apprenticeship program, says company founder Richard Banfield, Boston, Massachusetts, USA. Mr. Banfield says he brings in “somewhat qualified” people who have some of the skills and experience he needs and then puts them through a 110-day boot camp.

Talent Troubles

According to respondents, the following are long-term challenges:

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Source: Rally the Talent to Win: Transforming Strategy into Reality, an Economist Intelligence Unit research program sponsored by PMI, 2014

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“We are actively creating our own talent and seeding the market with alumni for the future.”

—Richard Banfield, Fresh Tilled Soil, Boston, Massachusetts, USA

 

“It’s a way to find the best possible candidates for these positions,” he says.

The apprentices take lower-level roles on projects under the supervision of senior people, which helps get the projects finished while providing the apprentices real-world experience and mentoring.

At the end of the boot camp, Mr. Banfield hires the best apprentices and then introduces the others to clients looking for young talent. Having under-skilled team members does require additional oversight, but it’s worth it, he says.

“We are actively creating our own talent and seeding the market with alumni for the future.” PM

This material has been reproduced with the permission of the copyright owner. Unauthorized reproduction of this material is strictly prohibited. For permission to reproduce this material, please contact PMI.

PM NETWORK DECEMBER 2014 WWW.PMI.ORG
DECEMBER 2014 PM NETWORK

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