THE SHIFT IN TALENT MANAGEMENT FOR FRENCH MNCS IN ASIA

REVUE DE GESTION DES RESSOURCES HUMAINES36

© Éditions ESKA, 2012

THE SHIFT IN TALENTMANAGEMENT

FOR FRENCH MNCSIN ASIA

Cécile DEJOUX1

CNAM LIRSA

Maurice THÉVENET2

CNAM LIRSA and ESSEC Business School

Western MNCs are currently facing newHR challenges in Asia. For years, theywere accustomed to being considered

very attractive for local talent, who saw them asgood potential employers. Basically, the percep-tion was that they offered comparatively betterbenefits and career opportunities than local com-panies. However, it could also be interpreted inanother light; i.e., that local candidates were notyet confident about how economic growthwould continue around the world and preferredto join well-established multinational companieswith known brands. In any event, the situationseems to be changing, at the expense of Westernmultinationals. In fact, young Asian talent nowprefers local companies to Western multina-tional, a preference that has created a real obsta-cle for Western companies in their strategy ofbeing key players of the economic upturn in theemergent countries in this part of the world.

Three reasons for this significant shift maybe put forward. First, the differences in benefitsand compensation are no longer significant be-

tween Western and local companies. Second,new Asian multinationals have emerged with achallenging policy to conquer new marketsaround the globe. As a result, international ex-posure is no longer limited to Western compa-nies. Third, local potential employees perceivea potential glass ceiling for future careers inWestern multinationals that could block their ca-reer progress at some point.

This shift in behavior among Asian talent isa serious challenge for French multinationalsthat need to reshuffle their local HR policiesswiftly if they are to staff the upcoming growthon Asian markets properly; i.e., when it will nolonger be possible to sustain the pace of growthin both the quality and number of staff by usingexpatriates.

Confronted by the difficulty of attracting, re-taining and managing Asian professionals,French MNCs need to reconsider their tradi-tional way of managing human resources in thisregion. In order to examine the scope, reality

1 Associate Professor at CNAM LISRA and Professor at the ISC Paris Business School.2 Professor at CNAM LIRSA et ESSEC Business School.

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The shift in talent management for French MNCs in Asia

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and future of this issue herein, we first considerthe economic, sociological and managerial fea-tures of this emerging problem. We then presentthe case of three major French MNCs so as tocontrast different business situations while pin-pointing similarities and differences in whichpolicies or strategies companies have been im-plemented as a response to this new situation.We conclude by drawing a few lessons pertinentto the current challenges of international humanresources.

1. THE ECONOMIC AND BUSINESSCONTEXT

For most Western MNCs, the potential forgrowth lies in the Asian markets. In fact, somecompanies have been investing for years thereso as to gain market shares. Asia and emergingcountries may be the real center for their busi-ness (McCool, 2007; Neal, 2007). A survey con-ducted by the OECD and the Boston ConsultingGroup (Vance & Paik, 2011) reported that in2010, there were one billion people of middle-affluent class2 in these new markets3. The samestudy forecasts that this number will increase to2.7 billion in 2020. That seems to modify the tra-ditional view of the stages of the international-ization of a company slightly. The usual patternwas the evolution of the local and domesticcompany towards the multinational company,combined with the myth of the global company.Instead of a global company, some MNCs re-semble ‘new-centered’ companies with a mothercountry and market that no are longer the epi-center of their activities and preoccupations. Infact, there are other centers possessing signifi-cant autonomy and a locally designed strategy.For example, the CEO of Schneider is nowbased in Hong Kong and the new VP (Strategy)of PSA, a major French automaker, is perma-nently located in China where the company’sCEO spends one week per month on a regularbasis.

Traditionally, theories related to the interna-tionalization of companies and businesses dis-played little interest in the HR side of the

process. Indeed, very little research has beenconducted on the topic. Most academic work ex-amines human resources issues with an eye onlyto international HRM (Festin & Royer, 2008)and expatriation (Cerdin & Le Pargneux, 2009).This apparent lack of interest in linking strategicand HR concerns becomes a problem of the ut-most importance, especially as human resourcesare a key factor in the success of any businessand as the context of the local talent marketshifts toward a new template. As it happens, thesupply of talent has changed in countries wherethe higher education system provides numerouswell-educated young people. Moreover, the con-tinuing expansion of national economies acrossAsia is spawning new companies and increasingthe demand for experienced executive or mana-gerial talent (McCool, 2007). Yahya & Kaur(2010) outline the fascinating example of Sin-gapore by comparing the strategy of recruitingforeign talent in Malaysia and Singapore whileconsidering its economic, political and socialimpact on local talent. Overall, however, multi-national enterprises face challenges in findingcompetent managers to staff operations and sub-sidiaries in emerging market economies (Koh,2003; Tomasz & James, 2007).

1.1. The traditional issuesof international humanresource management

As mentioned, traditional discussions of in-ternational HRM have neither included these is-sues nor even anticipated them. It is true that alarge body of research has been devoted to ex-patriates, managing cultural differences and,sometimes, the need for global policies in thefield. Obviously, economic growth in Asia hasraised the issue of recruiting and integratingyoung local talent for some time now. After all,there was a real need for people who had a thor-ough knowledge of the language and culture ofthese countries (Tomasz & James, 2007), andMNCs could not find at home Western citizenswith the right portfolio of linguistic, cultural andbusiness knowledge plus experience. Of course,that was a comfortable situation at a time when

2 Middle-affluent is a term applied to households with disposable income > USD 15 000.3 Countries included :China, India, Indonesia, Pakistan, Thailand, Philippines, Kazakhstan, Malaysia, Vietnam, Russia,

Ukraine, Turkey, Brazil, Mexico, Peru, Colombia, Egypt, South Africa, Iran, Nigeria, Algeria, Morocco,Saudi Arabia.


MNCs enjoyed a fine reputation among youngAsian talent, who saw opportunities for explor-ing new parts of the world and for acquiringboth experience and additional training thatwould be of great value on the market in the fu-ture (Yeung, Warner, & Rowley, 2008).

1.2. The context of talent management

This new challenge for MNCs occurred at atime when talent management appeared to be anew frontier for renovating and reshuffling HRpolicies in companies (Farndale, Scullion, &Sparrow, 2010). When the notion became pop-ular at the beginning of the 2000s with McKin-sey (Michaels & Handfield-Jones, 2001; Pfeffer,2001), the ‘War for Talent’ meant the incomingfight between companies for attracting and re-taining the candidates necessary for their devel-opment during the .com or internet bubble andwhen demographic issues started to becomemore obvious in Western countries.

Throughout the last decade, the notion of tal-ent has remained a concern. In some areas, talentmanagement progressively replaced human re-source management (Dejoux & Thévenet,2012). In other areas, talent management em-phasized the difficulties inherent in detecting, at-tracting and retaining the talent considerednecessary for the achievement of new strategies(Cappelli, 2008a; Cappelli, 2008b, Rajwani,2009). By the late 2000s, a more strategic ap-proach emerged which held that attention to tal-ent would allow human resource managementto become more strategic. The idea was that thesuccess of a strategy ultimately depends on thepresence of key talent within a company. Thosetalented individuals are no longer synonymouswith high potential but rather with succeedingin a business policy (Boudreau, 2010; Boudreau& Ramstad, 2007).

The new challenges for MNCs in Asia illus-trate perfectly this concern for getting the rightpeople to ensure success of a strategy. Thesecorporations need local talent for a series of rea-sons (Hsieh, Lavoie, & Samek, 1999), and thetalent pool appears shallower since these MNCsare less attractive than in the past (Williams-Lee,2008). Consequently, companies need to ap-proach their policies differently while under theconstraints of time and competition. Hence, theissue is no longer whether talent management ismerely a re-packaging of what already exists

(Pigeyre, 2011), but rather how talent manage-ment can bring new solutions to address theproblem of a shortage of Asian talent.

Actually, this issue is also addressed in Asiaand in terms of talent management. Some schol-ars (Iles, Chuai, & Preece, 2008) show how sixChinese firms have dealt with the matter. Theyreveal how some firms focus on “exclusive-peo-ple” (certain groups of high-performing or high-potential candidates), while others used an“exclusive-position” focus on certain “key” po-sitions in the organization. Heid & Murphy(2007) explain that a Global Talent Index (GTI)has been elaborated to measure the location oftalent. The GTI indicates that the USA will re-main a talent pool until 2012, and a shift to theBRIC will follow.

1.3. Difficulties faced by Western companiesin China

Many studies (Connell, 2010; Schmidt,2011; Ulrich, 2010) have outlined how WesternMNCs are less attractive to Asian (especiallyChinese) students. Schmidt (2011) conducted asurvey from 2006 to 2010 by collecting data on300,000 employees and job candidates in Chinawithin 60 firms. In 2007, the results revealedthat 41% of highly skilled Chinese professionalspreferred to work for a Western multinationalwhile only 9% favored a job in a domestic firm.By 2010, the figures were respectively 44% and28%. It appeared that MNCs remain the num-ber-one choice and that this situation might berelated to the present economic climate. Second,there are more and more graduate students inChina alongside more and more fast-growingdomestic companies. Third, some studies(Rashid, 2010; Ulrich & Sutton, 2011) empha-size a crucial difference between male and fe-male respondents as far as the choice of anemployer is concerned. Women look for West-ern MNCs because of the opportunity for inter-national assignments. They are highlyambitious, even if they need to break through avery thick glass ceiling. On the contrary, menprefer to remain in their home country and notnecessarily in the big cities. Finally, there is adebate about the number of Chinese studentswho return home. Tung (2008) explains that, ac-cording to the Chinese Academy of Social Sci-ences, 70% of the Chinese students whoexperienced studies abroad did not return to the






homeland. This question of talent flow (or“brain drain”, “brain gain”) is becoming moresignificant.

A few possible reasons may be put forwardin order to explain why Western MNCs may losetheir attractiveness as top employers in thisemerging and growing marketplace:

– The MNCs’ hiring advantages (higher sta-tus, safety net, long-term career path, inter-national assignment) are no longersignificantly more generous and motivat-ing when compared to the packages thatlocal companies offer;

– With the help of a good international edu-cational background on top of their na-tional culture (Guanxi4 for example), theyoung Chinese graduates accumulate thepotential ingredients for a successful careerin a local company. Whereas, they considerthat they will never be able to get theequivalent portfolio of key competencesfor succeeding in Western MNCs;

– The best Chinese talent often leaves foreignmultinationals with the conviction that theywill become successful entrepreneurs. Inother words, they will remain in their owncountry, be in a position to seize any emerg-ing opportunities and thus make more moneyas an entrepreneur than as a manager;

– MNCs and their brands (except the luxuryindustry) took a hit during the 2008 crisisand reduced staff, hiring, and expenses.Many graduates will remember that and tryto avoid the same experience in the future;

– Chinese graduates may be impatient, thus un-willing to wait too long for key positions. HRprofessionals in Western MNCs mention thisimpatience and the common reaction of Chi-nese employees leaving the company if theydo not get top jobs after a couple of years;

– We can also imagine, even though it is dif-ficult to assess it firmly, that young Chinesetalent may feel more and more patriotic aslong as the political status of their countryis rising in the world; as a result, they mayfeel honored to join a national firm at atime when the reputation of Western insti-tutions is fading;

– The public sector in many emerging coun-tries is also more desirable because of jobsecurity, professional opportunities, bene-fits and prestige. Rashid (2010) points outthat 60% of Indian male and female stu-dents aspire to work in the public ratherthan private sector.

1.4. Overview of possible solutions

Facing this challenge, Western MNCs needto develop different strategies to break throughwith traditional policies and also to sustain theirgrowth in this fast-growing market (Zheng,2009). Jenkins (2006) shows there is a criticalneed for the accurate and meaningful assessmentof the impact of talent management and leader-ship development initiatives. Let us begin ouroverview by highlighting two seemingly preva-lent policies. The first policy consists of attract-ing and retaining young talent by implementinga talent management approach. The second pol-icy consists of hiring young Western expatriateswith local contracts. These very general talentpolicies emphasize the need to accommodate in-dividual expectations and, consequently, preparepackages that are more and more specific andattractive to individuals (Cantrell & Smith,2011). These policies require that multinationalshave processes in place so as to integrate indi-viduals into the social and cultural context of thecompany better.

From a practical, even sophisticated, per-spective, Schmidt (2011) highlights five differ-ent strategies for those Western MNCs thatconsider operating in China:

1) reboot employment-branding effort withhigh-profile university alliances and sponsor-ships;

2) create local development because mostChinese candidates want to stay in China;

3) offer variable career paths and a com-pelling long-term career plan;

4) be smart about pay because domestic firmpay increases between 20% to 50% more thanMNCs to keep talent at home;

4 Guanxi comes from Confucius and refers to the concept of drawing on connections or networks of contacts,which an individual may have, thanks to his/her family, friends, individual or professional relationships.




5) become a quasi-local company by devel-oping relationships with local suppliers in sec-ond- and third-tier Chinese cities.

We emphasize here that the traditional strate-gic approach in HR should remain open to someissues usually not addressed. For instance,Rashid (2010) has outlined the importance ofgender in these countries. A large survey, spon-sored by five global companies (Bloomberg,Boozc & Company, Intel, Pfizer and Siemens)was conducted in emerging markets (Brazil,Russia, India, China and United Arab Emirates)among 4,350 college-educated men and women,supplemented with focus groups. Resultsshowed that talented women in emerging mar-kets are ahead of the curve in unexpected ways.These women represent 65% of college gradu-ates in the UAE, 60% in Brazil, 47% in China,50% in India. They represent a huge talent poolthat is currently underleveraged. Nevertheless,should a talent management approach focus onthis group, it would have to take into accountcertain characteristics. First, women are highlyambitious and aspire to hold a top job (42% ofhighly educated Indian women earn as much ormore than their spouse). Second, they are will-ing to work extra hours (49 hours a week inBrazil, 73 hours in Russia, 58 hours in India, 71hours in China5) and they do express a real pas-sion for their work. Third, they face a doublechallenge that limits their career path: having tocare for the older generation (in India and China,the notion of filial piety influences many deci-sions), so they are hindered by both maternityand family values.

As mentioned above, our research has fo-cused on three major French MNCs that are gen-uinely international in their activities and canpotentially be significant players in the compet-itive Asian markets. The survey of these threeexamples should provide interesting informationat three different levels: (a) the survey describesin real time how these companies are adjustingto ongoing rapid change within the Asian con-text that may jeopardize their traditional HRpolicies; (b) the analysis will foster reflection byHR scholars on talent management, its realityand the emerging HR policies and practicesflourishing under the umbrella of this not yet

stabilized concept; (c) the survey should help usunderstand better, in terms of the strategic ap-proach of human resource management, the ra-tionale of these HR policies, given thecharacteristics of the three businesses, theirglobal strategies, plus their corporate and HRcultures. From a human resources perspective,these challenges should illustrate how the HRfunction organizationally tackles issues of talentmanagement given the balance of power and in-fluence of the corporation vis-à-vis the local en-tities.

2. BUSINESS CASES6

Research MethodologyThe methodology is based on exploratory

case-study research (Eisenhardt, 1989; Yin1994). As related by Yin (1994, p 14) “ the casestudy strategy should not be confused with“qualitative research” (see Schwartz & Jacobs,1979; Strauss & Corbin, 1990; Van Maanen,1988; Van Maanen, Dabbs, & Faulkner,1982)… case studies can be based on any mixof quantitative and qualitative evidence. In ad-dition, case studies need not always include di-rect, detailed observations as a source ofevidence”. A case study consists of a descriptionof an entity’s actions. Our research was basedon planning case studies and we had in mind thequestion to answer: “How does the talent man-agement process address the issue of attracting,retaining and developing young Asian talent?”The greatest advantage of the case study methodis that enables researchers to reveal how a mul-titude of factors have interacted to produce theuniqueness of the problematic.

Case SelectionWe selected three French MNCs that are con-

fronted with the same issue of staffing theirAsian activities with young Asian talent. Thethree companies have activities in different in-dustries (health food, consumer goods, industrialprojects), and have been involved in an Asia-centric talent management process for more than

5 R. Rashid, R. 2010. The Battle for Female Talent in Emerging Markets. Harvard Business Review: 101-106. p 104.6 The authors would like to thank all the respondents from DANONE, L’OREAL and ALSTOM for their time and their

valuable insights.




five years. They all share the same objective ofdeveloping local staffing.

Data SourcesThese three business cases are drawn from

broader research on tackling HR issues fromFrench MNCs in Asia. In these three firms, in-terviews with the HR country managers (China,India, Singapore) and HR managers (HR projectleaders, talent manager leader) were conductedfrom 2008 to 2011. Some participants are gen-eralists, responsible for all areas of HR; whereas,others are managers of a business unit who haveimplemented talent management tools (table 1).

Data CollectionThe participants’ job titles vary, but all are

involved in policies and processes related to tal-ent management in Asia. The participants’ ex-perience in the HRM field ranges from 2 to 20years. Of the six female and seven male partic-ipants, six hold certification in the HRM field.For this study, data were collected through var-ious methods: face-to-face, semi-structured, in-dividual, and in-depth interviews wereconducted with 13 HRM practitioners, with thehelp of an interview guide. Documentation re-views and archival records have been read andexplored to multiply the sources of evidence.This triangulation across various techniques ofdata collection proves especially fruitful in thatit provides multiple perspectives on an issue, al-lows for cross-checking, and yields strongersubstantiation of construct (Eisenhardt, 1989;Orlikowski, 1993).

The interview protocol was based on the re-search framework and the process of talentmanagement. Practitioners were contacted by

telephone to determine their willingness to par-ticipate. Interviews are focused interviews(Merton, Fiske, & Kendall, 1990) in which arespondent is interviewed for a short period oftime (less than 130 minutes). In such cases, theinterviews may follow the interview guide butmay still remain open-ended and assume a con-versational manner and can contain a set ofquestions derived from the case study protocol.The interviews varied in duration, but all fellwithin a range of 90-120 minutes each. Someinterviews were organized face-to-face, someby telephone. Interviews were tape-recorded,transcribed verbatim, verified by the respon-dents and used an interview guide in order tofurther explore the “black box” of how the tal-ent management process is implemented. Thisinterview guide consisted of both closed-endedand open-ended questions that were asked ofall participants. Examples of the questions in-cluded: “What kind of tools do you use to at-tract Asian talent?” and “[t]o what extent doyou use mentoring to retain young Asian tal-ent?” For the latter question, participants couldchoose from a scale of 1-5. The interviewssought to obtain both consistency and diversityin responses in order to develop a better under-standing of the perceptions of attraction and re-tention of Asians.

Analytical StrategyThe data were analyzed using content analy-

sis (Miles & Huberman, 1984). Thematic unitswere identified and formed the basis for answer-ing the guiding questions. At the same time, thisresearch employs an interpretive ontology witha realist epistemology to facilitate the under-standing of managerial perceptions because“when investigating contemporary phenomena

DANONE L’OREAL ALSTOM

HR Asia Pacific International Recruitment Director Talent Management Directorof South Asia

HR Talent Managementproject executive Employer branding Director Singapore HR Project manager

China HR Manager HR Talent Recruitmentproject manager China HR Project manager

Indonesia HR Manager HR South Asia

China HR project manager

Singapore HR project manager

Table 1: The sample of the Study


within real-life contexts when the boundaries be-tween phenomenon and context are not clearlyevident” (Yin 1994, p.13).

With this in mind, we prepared a general an-alytical strategy to apply to the case studies (Yin,1994, p 106). After collecting the data, each in-terview was coded separately on the basis of “invivo” words, phrases, terms offered by the in-formants. First-order codes are discerned. Then,various analytical techniques (see Miles & Hu-berman, 1984) have been implemented; such as,putting information into different arrays, makinga matrix of categories and placing the evidencewithin the categories, creating data displays forexamining the data, tabulating the frequency ofdifferent events, using some other temporalscheme. Data collection, or first step of the strat-egy, relied on a theoretical proposition about thecausal relationships in answers as to how andwhy talent management enables companies to at-tract and retain people (Boudreau, 2010; Cap-peli, 2008a; Lawler, 2008). The second step ofthe analytical strategy was a descriptive ap-proach that was used to explain why implemen-tation of talent management for young Asianshad succeeded.

2.1 DANONE : How to attract Asian talent?

DANONE, created in 1966 by Antoine Ri-boud, is a fast-growing food company who hasdefined its mission since 1995 as “bringingHealth through food to as many people as pos-sible in the world” that experienced a major shiftin 2007 allowing to have a business 100% con-sistent with the mission. DANONE underwenta commercial and geographical transformationto create a new health-oriented company. First,in 2007, DANONE focused its activities on fourcore competencies (57% fresh dairy products,20% baby food, 17% bottled water, 6% medicalnutrition). To achieve its target, the firm sold itsbiscuit business and bought Numico, a worldleader in infant and medical nutrition. Second,the company decided its future was linked toemerging markets. The shift may be seen quan-titatively: in 1996, the largest share of sales wasin Europe (77% of the sales breakdown) versus17% in emerging markets; by 2010, only 39%of DANONE’s business was carried out in Eu-rope and almost half of the company’s businesswas in emerging markets (49%).

Asia has become one of the key drivers forthe growth of worldwide business for DANONEnow and in the foreseeable future. Indeed, Asiashould represent about 13% of the company’sbusiness and 50% of the growth of the entireDANONE group is done in emerging markets.In order to make this growth possible, the firmneeds to make a shift in the rapidity of talent de-velopment to be able to provide the businesswith the local talent pool needed to face the highgrowth.

DANONE faces specific marketing, businessand HR challenges in this part of the world andseeks to do the following:

– Reinforce its product and brand image.Some DANONE products (e.g. AquaWater in Indonesia) are well known andsome are breaking into the market (espe-cially baby formula).

– Develop the local sales force and its man-agement. The company needs to hire manyyoung salespeople and managers to in-crease its market shares.

– Expand its relationships with universitiesand business schools in Asia by promotingits serious game “Trust by DANONE”, aneffective tool to promote the working speci-ficity of the company. Management traineeprograms have been created to integratemore efficiently the young graduates.

DANONE has many strengths which shouldhelp it reach its goals in Asia despite the fact itis not yet the leader because it is two timessmaller than Unilever and five times smallerthan Nestlé. For example, DANONE possessesa very strong culture of entrepreneurship that en-ables its subsidiaries to take local initiatives tofulfill their needs. For example, thanks to its re-search center and its local marketing surveys,DANONE will find the right taste of dairy prod-ucts for Chinese consumers, as it has done in somany countries. The ninety subsidiaries are en-couraged to propose products and action plans toadapt to the local market. Also, people have beenconsidered a key driver ever since the company’sfounding by Antoine Riboud. Talent manage-ment has been the heart of the human resourcemanagement process for more than fifteen yearsand HRM has implemented many people-cen-tered tools such as a specific program for Asianemerging markets, called “BO Le” in Asia.

The “BO Le” program was launched in Jan-uary 2010 as an ambitious policy to accelerate




the focus on the urgency to develop Asian lead-ers. This program was built through a cross-di-vision, country and multiple-function team.Three objectives have been defined: attract, de-velop and retain talent. “BO Le is a strategic HRprogram for DANONE because the growth ofour business is located in Asia. The target of theBO Le program is to accelerate the developmentof young Asian talent. We have an objective toempower people in their team, to define whatare the key drivers in Asia to grow the resourcepipeline after having analysed the manpowerneeded in the next 3 to 5 years, and to allowAsian leaders to grow in Asia then worldwide ”,said the HR Director of DANONE Asia Pacific.

The project teams have recommended key ac-tions such as building a stronger employer brand-ing, developing and generating talents faster, andretaining new or existing ‘DANONErs’.

Three groups have been working on this tal-ent management program: Attract, Develop andRetain. Below are details about each one.

• Attracting talent through strongemployer branding

The group conducts a survey about the em-ployer brand in five Asian countries and outlinesa gap between in-house management values andpeople’s perception. This survey helps the com-pany focus on different key items regardingcountries. For example, in China what was re-vealed was working environment, career devel-opment, proximity, entrepreneurship andpragmatism. “Danone is indeed not alwaysknown for what it is now, but for what it was inthe past. For instance, an employer brandingsurvey conducted in China in 2010 showed thatDanone was still perceived as a biscuit companyboth by young graduates and professionals. Orin fact, the group sold its biscuit business backin 2007, while buying Royal Dutch Numico. Thenew Danone, 100 % focused on healthy foodproducts with the integration of the medical andbaby nutrition businesses”. Many sponsoringoperations have been set up in universities tocommunicate and to attract graduate students.Some student ambassadors have been trained topromote the brand in student activities.

• Developing talents from within to generateyoung Asian managers

“An analysis of Danone’s talent pool in Asiawas led and revealed that the group had not

enough [individuals] to grow in a sustainableway in the region. There was the need to takequick action to face this challenge. The idea wasto build a common ambition to tackle this issuein a collaborative way. As a result, a group of20 people representing Danone in Asia (peoplefrom different functions, CBUs and countries)was created to identify this needed common am-bition. Then two groups […] have been identi-fied by the firm to set up a talent pipeline: agroup of ongoing leaders and a group of man-agers.”

For each of these two groups, a specific pro-gram included tailor-made training, a projectsworkshop as well as networking and coaching.Specific leadership programs and self-assess-ment workshops on emotional competencieshave been proposed. Each local talent has towork on a Business Unit strategic Project withother participants from other divisions to solvea relevant problem. In addition, they are pro-posed to participate to a CSR project they arechoosing themselves, in order to develop a deepunderstanding on contributing leadership. TheHR committee has organized events (coffeemorning, lunch) with two general managersfrom all the divisions for each talent. The objec-tive is to facilitate the transfer of employees andto expand the individual employee’s network.Finally, coaching sessions have been designedto train managers to become effective coachesfor their own teams.

• Retaining talent for the futureGiven the high turnover in Asia, talent reten-

tion is considered a key challenge. The firm hasensured that the salary package to its competi-tors’ practices and to reinforce the safety net“because of the tradition of looking after seniorswithout a pension. This is one of the elements ofthe company’s health goal and it echoesDanone’s global mission (to bring healththrough food to as many people as possible).”Tremendous attention is paid to people who re-sign, in fact, an exit interview is automaticallyconducted.

More and more Asian managers and execu-tives have been nominated to lead key positionsin Asia and international assignments in Paris.A local director was promoted to a general man-agement position two years after launching “BOLe” and a Chinese regional vice president wasnominated from the general management pool.




The “BO Le” program remains anchoredthanks to two basic tools: a roadmap in each ofthe countries which sums up the key action, keytiming and key people plus a dashboard with keyperformance indicators which are assessed everytwo months by the HR steering committee inAsia. After two years, a survey based on onlineanswers and 30 interviews was conducted andoutlined three positive results: the hiring ofyoung talent has increased dramatically, thecommitment of the Asian employees has im-proved and the turn-over has decreased.

In order to reinforce its position in Asia,DANONE has implemented a talent manage-ment process to fulfill its recruitment needs.With the “BO Le program”, the firm displays alocal hands-on approach that has reached twomain objectives: hiring young Asian talent andcommitting all employees by boosting their mo-bility in Asia.

2.2 L’OREAL: How to develop youngAsian talent

L’OREAL is a leading global company witha mission to make beauty universal in a sustain-able and responsible way. In 2009, L’OREALcelebrated its 100th anniversary. This interna-tional group promotes 23 global brands in 130countries, hires 66,600 employees and, in 2010,had 612 patents. With the opening of emergingmarkets, L’OREAL’s mission has broadened inresponse to the vast diversity of populations. In2010, L’OREAL had 64% of its business inWestern countries. For 2030, the company’sbusiness forecast is 70% in Asia, Africa, andLatin America. Attracting, developing and re-taining young talent in Asia is becoming crucialfor the company. Indeed, L’OREAL’s Asia Pa-cific Business Unit hires one hundred people,considered young talent, for India, Singaporeand South Asia annually; whereas, it hires morethan 500 for all of Asia (China included). How-ever, the turnover is rather high at more than50%.

Given this context, L’OREAL has decided todevelop all the young talent in the Asia-Pacific.“[the] talent management process is about mak-ing long- term commitments with chosen indi-viduals that will develop their talent and buildour company for the greater future. The Gen Yin the BRIC, and especially in Asia, is one of ourpriorities and talent management is one of the

solutions to attract and retain them”, said the In-ternational Recruitment Director of L’OREAL.The HR director of this area describes Asia’sGeneration Y as well-connected, ambitious,techno-addicts, who are mobile, want to be in-dependent from their parents. In order to attractthese candidates, L’OREAL had its ‘campusmanagers’ in the targeted universities. They pro-pose sponsorship opportunities, interviews, in-ternships and workshops. Furthermore, the firmproposes a famous worldwide ‘serious game’,entitled “BRAINSTORM”, with a pool of localuniversities.

A talent shortage remains the first problem.However, retention through development is an-other one with which the firm is struggling. Asa result, three major courses of action have beendrafted for L’OREAL in Asia: learning, compen-sation and promotion.

L’OREAL has a lot of experience in effectivelearning workshops. One ‘must’ for newcomersis the two-year personalized guidance and train-ing program appropriately called “FIT”. Thistwo-year process is based on six key areas (ex-perience in the field and with the products, train-ing and round-table discussions, personalizedmeeting programs, on-the-job learning sup-ported by the line management, individual guid-ance with mentoring and HR support and, at thevery start, a successful welcome). A specificlearning program about leadership is offered soas to meet the expectation for learning quicklyand gaining as much as possible in the shortestperiod of time possible. An assessment centerallows new employees to improve their individ-ual skills. Mentoring programs help them getquick answers to their questions and expandtheir internal network in such a big company.For L’OREAL, integrating a newcomer is ashared responsibility: the manager is consideredan operational coach; the human resources teamare project drivers; the newcomer, a potentialgreat performer.

Compensation is also a key argument. Inmany Asian countries, local companies offerbetter compensation packages than WesternMNCs do. For candidates, the compensation andthe safety net that a firm offers is a determiningfactor, because they need to think about their fu-ture as many Asian states do not provide socialcompensation (unemployment indemnities,medical benefits, retirement pension). Further-more, in these countries runaway inflation is thenorm combined with the rising cost of living (es-




pecially housing). “Gen Y in Asia is difficult toretain. They quit the firm if they have a betteropportunity. They need to think about their fu-ture because the government doesn’t provide so-cial compensation, and they pay for theirrelatives.”

Promotion has become another requirementfor the Asian Generation Y. This generationwants to stay for fewer than 3 years in a firmand to be free to test the job market and possi-bly join a new firm with better salary condi-tions. To meet this challenge, L’OREAL hassped up the pace of projects, enhanced respon-sibilities and a worldwide network within thecompany to keep Generation Y committed tothe firm. Mobility is thus encouraged, includ-ing giving early responsibilities to new talentwith a limit of two steps at a time, maximum.One step is a change of hierarchical position,country, division, professional field or trade.Every entity has a formal process of talent re-views and nomination committees, under theresponsibility of the national managing direc-tor. Staffing decisions are made according tothe potential of individuals, as assessed by theaccomplishment of a mission and actual per-formance on the job, competences (seven L’O-REAL general competences plus technicalcompetences), employee aspiration, experienceand character.

The talent review focuses on the detection ofpotential employees and their development ofemployees. The review has four objectives:

1) focus on individuals; 2) review and regular updating of the pool of

potential talent for key positions;3) examination of individuals’ careers;4) identification of potential gaps for sourc-

ing the need of the different entities. This review takes place at least once a year

and produces an individual talent review formand a talent list. “L’OREAL talent manage-ment program aims at providing individualswith the conditions to develop their talent overthe long term and generating most of the tal-ents and competences necessary for the growthand development of the business.” A secondand complementary process involves nomina-tion committees. The target of these commit-tees is to organize mobility. In other words,they focus on key jobs, fill vacant positions ac-cording to the short-or medium-term, and es-

tablish a calendar for the process. The commit-tees meet four or five times a year and elabo-rate a succession plan. “L’OREAL takes along-term approach on career development,based on people’s performance and potential.The group offers a wide variety of career op-portunities.”

In conclusion, L’OREAL Asia uses all thecorporate tools and support at its disposal to de-velop the Asian Generation Y through its talentreview and nomination committees. At the sametime, the Asian L’OREAL core business units(CBUs) have taken the initiative to integrate cul-tural specificities and meet the requirements ofthis specific ‘spoilt’ demographic.

2.3 ALSTOM: How to retain youngAsian talents

ALSTOM is a world leader in transport in-frastructure, power generation and transmission.The firm is present in approximately 100 coun-tries with sales (in 2011) of about 21 billionEuros, and hires 100,000 employees in threefields: power transmission (56%), grid (17%)and rail transport (27%). The group continuedits growth strategy in the BRIC countries, forg-ing strategic relationships with local partners. Ina 2010 interview, ALSTOM’s chairman, PatrickKron observed that “the geography of our mar-kets is shifting and demand for systems, equip-ment and services is changing with it. In2009/10 emerging markets accounted for 35%of our orders. In 2010/11, that figure was almost60%.”

This global French company competes andsigns contracts for an increasing number of proj-ects in Asia (subway in Chennai, India; metroprojects in Singapore and in the Republic ofChina). Like many Western companies in thispart of the world, ALSTOM faces the challengeof how to retain young Asians.

Its target: become a local firm with projectsand operational teams. In order to carry outthese projects, the company needs to developAsian managers and train them according toALSTOM’s values. For that reason, ALSTOMhas set up a specific talent management processfocused on a training program, called“GOAL” (Grow Our Asian Leaders). “Manyyoung Asians try to know how much discrimi-nation is in the company and if the companytreats its nationals the same as the others. They




want to know what kind of future they can haveat ALSTOM if they stay more than 3 years. Thatis why GOAL, our talent management programis a great example demonstrating our will tohave one policy for everybody to be promotedin the company, whatever country they comefrom, ” said the Talent Management Director ofALSTOM South Asia.

GOAL has three objectives: (1) create anAsian group of managers and initiate an Asiannetwork; (2) break the glass ceiling and demon-strate that the firm wants to push Asian man-agers to become executives; (3) reinforceALSTOM’s culture and develop relationshipswith the headquarters in France.

The program concerns three groups of tal-ented employees: (1) added-value employeeswhom the firm wishes to assist in charting theirin-house career path; (2) indispensable special-ists with strong technical skills; (3) high poten-tial employees who could reach senior posts orbecome executives in the short or middle term(4-8 years). The first GOAL session took placefrom 2009 to 2011and involved 12 people fromall Asian countries.

The content of this program has been de-signed as follows:

– A personality inventory test (MBTI: MyersBriggs Type Indicator) to help people beaware of their strengths, their improvingaxes followed by drills to drive their Emo-tional Intelligence in order to improve re-lationships with others;

– A leadership workshop to bridge Asian andWestern cultures that can be distinctly dif-ferent;

– Different workshops designed to reinforcespecific managerial technical skills such asmedia-handling skills, presentation skills,etc… “For example, we want to teachyoung Asian talent how to use their emo-tional competencies because in an interna-tional and cross-cultural context it seems areal asset.”;

– An educational visit to the French head-quarters in order to strengthen their in-house network and to be committed tosharing the vision of the top executiveteam;

– Visits to various work and business excel-lence centers to gain a deeper understand-ing of the business;

– A project-based active learning processwhere cross-cultural groups of 4 have towork on a project for one year under thementorship of a dedicated senior manager.This project entails inter-regional interac-tion and research with French colleagueshorizontally and vertically within the hier-archy. The topic of this virtual work (eachmember lives in a different country) meetsan important need for the French and theAsian headquarters and gives the employ-ees the opportunity to use their new net-work and to develop close relationshipswith all the people met.

– At the end of the program, each groupmakes a presentation in front of the Asianboard, with representation from headquar-ters in France.

The first session of this program turned outto be a real success. “People were positively sur-prised to have so many benefits from this pro-gram. For example, they improve their internalsocial network and they understand French cor-porate culture better.” Eleven out of twenty peo-ple were promoted and changed their positions.For example, in finance, this program helpedcreate a talent pipeline. In fact, the trainees haveworked in different Asian countries and haveimproved their analysis and forecasting skills inthis complex and very demanding field, accord-ing to the human resources department. Some ofthem have been sent, or ‘expatriated’, in Europefor three years to reinforce their technical skillsin power transmission. Another strength of thistalent management program lies in its ability tofacilitate job transfers from one sector to anotherfor transferrable skills (excluding technicalskills).

In terms of retaining young Asian talent, AL-STOM relies on the originality of its GOALprogram and HR executives are convinced thatan HR differentiation is directly linked to lowturnover.

3. RESULTS, LEARNINGAND DISCUSSION

In what follows, we provide an overview ofthe main practices of these firms as well as high-lights of the main lessons to be learned from thethree cases. We also suggest topics for furtherdiscussion.




3.1 Results from the cases

Ready, Hill, & Conger (2008) claim that emerg-ing markets pose special challenges for foreign multi-nationals and the talent management process needs

to be aligned to new constraints specific to these mar-kets. The three cases confirm the above statement. Inorder to manage the issue of a shortage of talents inAsia, DANONE, L’OREAL and ALSTOM have pro-posed similar answers:



Table 2: Overview of Asian Talent Management ProgramsDANONE L’OREAL ALSTOM

Date of entry in Asia 1997 1993 1992

Activities Health food Consumer goods Industrial projects(Transport, power, grid)

Countries underthe responsibilityof the regional HRin Asia

New Zealand, Australia,India, North Asia (Japan,South Korea, China),South-East Asia (Indonesia,Malaysia, Singapore,Thailand). For dairyactivities: (Middle Eastand South Africa added)

China, Hong-Kong, India,South Korea, Taiwan,Singapore, Malaysia,Indonesia, Australia,new Zeeland, Thailand

For transport: China,Hong-Kong, India,South Korea, Taiwan,Singapore, Malaysia,Indonesia, and Australia.

Fields of responsibilitiesbetween regional HRMand country HRMin Asia

- cross-corporate HRfor all activities- in each businessdivision in Asia,there is an HR Director- China : « HR sharedservice » in chargeof recruitment, learning,resources development

- HR country- HR internationalrecruitmentat a corporate level- HR international talentdevelopmentat the corporate level

- HR Project: recruitment,salary management,HR project, supports the Project, reportsto the countryHR hierarchically- Country HR: staffingmanagement of all projectsacross sectors (Transportsector, Power sector, Grid)within the country.Optimizing HR manage-ment between countries. Reports to the CountryPresident operationally,and to the DRHAsia-Pacific hierarchically. - HR Director Asia-Pacific Reports to Presidentof Region operationally,and to the InternationalHRM Directorin France hierarchically.

Target of the TalentManagement program

Attract, developand retain Asian talent

Active policy of contactswith universitiesDevelopCompensationPromotionAcculturationto the companyand its business.

Development Leadership programAssign talent to Positionof greater influence.

Talent managementdecision-making HR Asia International HR Director HR Asia

Talent managementprogram and tools

BO LeTRUSTCampus of UniversitiesBrand imageCoachingMentoringLocal task forceEmpowermentRoadmap

FITCampus of Universities‘Serious game’Worldwide training Assessment centerChallengingMentoring

GOALInternational mobilityProject leaderChallengingEmotional competencyassessmentCross-cultural projectsBreaking the glass ceilingTalent review form


– Creating a specific talent managementmodel for Asia

A new model of international HR is appear-ing in emerging markets and more specificallyin Asia for MNCs. This model needs to align theyoung Asian’s aspirations that are different fromthose of the young Westerner.

Attracting, developing and retaining youngAsian talent could therefore focus on targetedactions such as:

– Focus on young, potential graduateswhile they are still at university

To draw upon a deep pool of young talentedemployees, firms develop tight relationshipswith selected universities. They try to identifygraduates in the same field as their activities andcreate a process of integration (internship pro-gram, workshop, sponsorship, student ambassa-dor, business case study, award and reward).

– Communicate about internationalmobility

The possibility of an international assign-ment may appear to be a great advantage in thejob proposal made to Asian talent. Even if somestudies (Schmidt, 2011) emphasize that nowa-days, the trend is for Chinese men to prefer tobe re-located within their own country.

– Target a long-term career withoutthe glass ceiling

If Western firms wish to win the talent battlein emerging markets, their HR approach shouldbe reshuffled to take into account cultural speci-ficities and local requirements. Removing theperceived glass ceiling seems relevant. How-ever, this is not a new way of managing. Indeed,many American MNCs active in Europe havepushed a European CEO to the head of theirbusiness unit. This must be an ongoing, logicalprocess, though.

– Increase the salaryIn Asia (and more particularly in China), the

level of salary increases regularly and reachesthe Western level for skilled personnel. Thestruggle with the public sector and with expatri-ates has raised standards. To compete, firmsneed to be aligned with the local companies andto propose a significant increase.

– Build a tactical training policyStudies have indicated that there are three

dangerous points when young employees may

leave a firm: 1) after 1.5 years; 2) after 3 years;3) after 5 years. To retain talent, some compa-nies had the bright idea of putting these employ-ees into a training program (leadershipworkshop, MBA program, and executive MBA)at these critical points and to make the talentsign a letter in order to keep them for two ormore years.

3.2 Learning from the cases

First, these three major French MNCs haveobviously adopted the concept of talent manage-ment. They all label their initiatives with thiswording that is supposed to be a disruption intheir HR policies in Asia. Although it may be toosoon to tell whether this constitutes a genuinebreakthrough, it is at least related to a perceptionof a dramatic change in the context of their tra-ditional HR policies.

Second, companies consider talent manage-ment in the same priority as issues of attractionand retention. That concurs with what the majoracademic books (Boudreau, 2010; Cappelli,2008a) or practical handbooks (Berger &Berger, 2010) argue as another order of priorityin HR topics in the context of what could be tal-ent management.

Third, these three case studies demonstratethat a large variety of policies and practices maybe found under the umbrella of the same so-called TM approach. Across the companies,these policies may cover training programs aswell as a compensation and career-managementpolicy.

Fourth, this variety of policies could be pre-sented as an escalation of policies from the de-velopmental approach (with a training program)of ALSTOM, to the broader scope ofDANONE’s policy (attraction, retention and de-velopment) and L’OREAL’s more consistent HRpolicy that encompasses development, career-management and compensation. This differencein the scope of TM policy has to be related tothe differences in their respective businesses.ALSTOM is settling in Asia according to theprojects it has to gain there and to implement ifsuccessful in bidding. DANONE has a strategyin Asia that is very different according to itsproduct divisions and countries. Therefore, theBO Le program is clearly associated to the com-pany’s business strategies in China and Indone-sia. In the case of L’OREAL, its presence in Asia




goes back quite a while. They are operating withfamous brands in a market of consumer and lux-ury products with a genuine effort of a regionalpolicy.

3.3 Discussion

Interestingly, the presentation of talent man-agement for these three French MNCs makes itclear that the emergence of talent managementcannot be considered outside of a local and busi-ness context that varies from a company to theother. Although it may have been considered afad by some authors (Pigeyre, Dietrich, Gilbert,Aubret, 2010), talent management in our exam-ples is a way of putting a name on practices andpolicies that are pretty new for these companies,either in Asia or in the mother country.

It will be interesting to follow up on thesecompanies in the future. This is truly the situa-tion of a region where MNCs see their growthpotential but may face greater difficulties in con-fronting local competition. All in all, we areprobably seeing a signal of what the economicand HRM situation of these companies will be.

We can then imagine that, in a kind of rebal-ancing of the regional activities of these compa-nies, the challenge of staffing and motivatingAsian staff may help companies to change theirHR policies worldwide. What is happening tothese companies in Asia is totally new and willgenerate a kind of cultural revolution in how HRis considered, just as the difficulties of the busi-ness challenge could trigger the more strategicapproach in HR that has been proclaimed byscholars for so long.

This survey has presented three limits thatfurther research will necessarily compensate.First of all, it would be interesting to increasethe sample size in order to be more specificabout the connections between these HR poli-cies and the general strategy of the companies.Second, given that this research has been con-ducted in real time with the implementation ofthese policies, we are unable to evaluate in themid-term the real effectiveness of what has beenimplemented. Third, it was helpful to compareFrench multinationals; however, it would havebeen significant and enriching to compare theirpolicies to those of other multinationals in thesame region or even in other emerging regionsaround the globe.

Conclusion

By addressing a brand new issue that FrenchMNCs face and by trying to decipher the emerg-ing policies and HR approaches, this articleopens up several perspectives that are of the ut-most importance for human resource manage-ment.

First, the study provides a good illustrationof how companies adjust their policies to theircontext by breaking or changing the traditionalrules of HR policies that would be directly man-aged from the top within the framework of aglobal unique strategy. That raises one of the keyquestions of international human resource man-agement: the organizational issue of who shoulddo what and where.

Second, the rising problems encountered byFrench MNCs in the Asian region exemplify thenew type of dilemma that companies must con-front when their reputation is not sufficient togenerate enough applicants and to find employ-ees who will be more ready to espouse the poli-cies and culture of the company. Clearly it iseasier to manage HR when you have a positiveand powerful reputation, like that which thesecompanies have traditionally enjoyed so far.Having new perspectives is thus important whena corporation seeks to develop its brand as anemployer.

Third, another perspective opens here and re-lates to the issue surveyed; i.e., the risk of notsucceeding in their new approach to local talent.What happens if these policies do not succeed?What can be done, then, in terms of HR policiesto sustain business growth in this part of theworld? With respect to Asian talent, there are afew ideas to explore. First, firms could adopt atargeted approach for women, who represent ahighly skilled group. For example, Googlelaunched the India Women in EngineeringAward in 2008 with an award of US$ 2,000.Second, MNCs explain to young candidates thatthey can build a strong network with a first jobin their company. This target is reached throughcoaching, mentoring approaches and business-centered projects realized in a cross-divisionteam (for example in General Electric with “my-Connections”, a talent-spotting and mentoringprogram in the United Arab Emirates). Third,companies could try to adjust to the cultural val-ues and current way of life. This might meanproposing a package that allows an employee to




take care of parents. In China and in India, theelderly have no more income. Furthermore, car-ing for one’s parents (or parents-in-law) is con-sidered a duty. Domestic firms, whichsometimes propose high salaries, have few suchbenefits. This supports Western MNCs takinginto account the situation and imagining a“package for the caring family”. This last idearefers to a certain exemplarity since mimesis canbe an effective means of management. Asianyoung employees might be motivated if theyknow the firm has already promoted Asian em-ployees to top jobs. Nothing is more effectivethan a positive story of a career path. Eventually,another approach to include would concern therenewal of policies targeted at talent comingfrom outside Asia. If it becomes impossible ortoo expensive to find young Asians, why nothire young highly skilled Western graduates whoare ready to be involved in a local contract for afirst experience? Through the Erasmus programand internships abroad, many graduate studentshave developed cultural skills and are eager totry a foreign assignment. A large number ofthem happen to have acquired international ex-perience that is adaptable to the situation whichgoes beyond the traditional limitations that existin managing expatriates. Such a scenario couldbe very positive in an Asian management pool.

Fourth and finally, we hope this article opensup a new vista for more observation of what ishappening in an area of HRM in contexts andsituations with which we are not traditionally fa-miliar. This type of research enables all of us torethink our assumptions on the field’s practices,strategic importance, and, indeed, its very role.

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THE SHIFT IN TALENT MANAGEMENT FOR FRENCH MNCS IN ASIA

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