EMPLOYEE RETENTION THROUGH TALENT MANAGEMENT IN AVIATION INDUSTRY

 

McKinsey has defined talent as “the sum of a person's abilities, his or her intrinsic gifts, skills, knowledge, experience, intelligence, judgment, attitude, character, and drive. It also includes his or her ability to learn and grow’’ (Joseph and Sridevi, 2015).In modern organizations, an imperative effort emerged on talent management. Recruit, retain, and develop the most talented employees in organizations is highly accomplished (Aakanksha and Navoditha, 2014). Baum (2008) said that identifying talented employees, developing them in the dynamic business environment, and retaining them in the organization makes sure that the organization successfully manages talent (Kumar,n.d).

Kumar (n.d) has stated even though talent management looks similar to human resource management, when focussing employees, human resource management focuses all employees equally while talent management concerns only high potential employees. Hence Tiwari and Shrivastava (2013) has showed that the human resource department plays a significant role in designing policies, practices and strategies to retain the high potential human resource. 

In 2001 Human Resources Study of Commercial Pilots in Canada has done research on pilot turnover. According to this research, the employee turnover rates in the aviation industry has explained in Table 1 and Figure 1. The highest 27.4% of companies have shown annual turnover rate, over 30%. As per the operation 33.8% of Air Taxi group, 50% of Cargo operation group and 50% of commuter operator group have shown over 30% of annual turnover rate (Kiernan, 2018).

Table 1: Turnover Rates as Percentage of Pilot Pool According to Company Type

(Source: Kiernan, 2018)

Figure 1: Percentage of companies reporting turnover rates of the pilot pool by category. Adapted from “Human Resources Study of Commercial Pilots in Canada” by the Air Transport Association of Canada, 2001.

(Source: Kiernan, 2018)

A case study has been done for a part 135 cargo carrier aircraft pilots in SHRM (2014) by using Hinkin and Tracey’s (2000) model. Hinkin and Tracey’s (2000) model divided total cost into five different categories: separation, recruiting, selection, hiring, and lost-productivity costs. According to this study, amount of turnover cost by category is given in Table 2 and Figure 2. The cost is shown in $ (Kiernan, 2018).

Table 2: Turnover Costs ($) by Category.

(Source: Kiernan, 2018)

Figure 2: Turnover Costs for Part 135 Carrier by Category.

(Source: Kiernan, 2018)

As per table 2, the cost of turnover per employee was $17,406, which represents 43% of the average pilot’s salary of $40,000. The actual pilot turnover rate for the Part 135 carrier used in this study was 46%. The total turnover cost for this carrier was calculated but is not presented for confidentiality reasons. As per this study, they have understood that turnover is an important issue in Part 135 operations, and the turnover costs have become a burden on carriers (Kiernan, 2018).

Katie Bardaro, lead economist at PayScale, Inc. says that employee loyalty to the organization has been reduced over generations. In such an atmosphere, organizations need to pay more attention to assess this, find reasons and improve retention strategies (Joseph and Sridevi, 2015). Harika and Bindu (2020) have defined employee retention, as it is “a procedure where the employees are motivated to retain in the organization for more time period or until the project get completed”. Talent management plays an indispensable role, with many benefits to motivate people, increase performance and engagement factors to retain top talent in organizations while increasing productivity, capability, satisfaction, commitment, career development, make the better linkage between individuals' efforts and business goals, increase bench strength and retention rates and further significantly decreases turnover rates and reduce turnover expenses (Yadav  and Mehlawat, 2011; Kumar,S, n.d).

Figure 3: Career development is one key aspect of talent management.

(Source: Nagarathanam, 2018)

Carrier development is one important aspect of talent management. Moreover, employee retention can be predicted by analyzing the carrier development practices in the organizations  (Marsden, 2002). According to him, carrier development will be a variable in employee retention. According to the research done by Nagarathanam, in 2018 to identify the impact of career development practices on employees’ retention in the Qatar aviation industry. It was observed that the relationship between carrier development and employee retention is statistically significant. According to the research outcome, 37.6% of the sample population retain in the Qatar aviation industry as a result of Qatar carrier development practices. 

A similar type of study has been done in the Indian aviation sector to find out the reason for trained pilots are absorbed by other airlines within and outside of India. As a result of that newly recruited pilots have to be trained, which is a huge financial burden to airlines. The study was done with the participation of 225 commercial airline pilots from different Indian airlines. Findings were revealed that several factors which are associated with lapses in the talent management process in the sector, affect the retaining of pilots. Those were employee-friendly recruitment policy, the impact of external factors, lack of employee branding, and self-advancement opportunities. The study itself suggested having positive working culture and working environment, create opportunities for individual carrier enhancements.

Both these studies have shown the employees willingness to stay longer period with the organization is related to individual level of satisfaction about the workplace talent management process and eventually, that would improve the organizational processes and functions effectively.

List of references: 

•  Aakanksha, N. & Navoditha, C (2014), 'Talent management', Bhartiya Bhasha, Shiksha, Sahitya evam Shodh, vol. 5, issue 5, pp. 49-55.

• Harika, T and Bindu, NH (2020), ' Employee Retention', International Journal in Management and Social Science, vol. 08, issue 03.

• Joseph, D and Sridevi, S (2015), ' Effective Onboarding As A Talent Management Tool For Employee Retention', International Journal in Management and Social Science, vol.03, issue 07, pp. 175-86.

•  Kiernan, KM (2018), 'Calculating the Cost of Pilot Turnover', Journal of Aviation/Aerospace Education & Research, vol. 27, no. 1, pp 49-69.

•  Kumar, S (n. d), 'Talent Management - A Strategic Tool For Employee Turnover & Retention', Emerging Concepts in Marketing and Human Resource Management, pp.99-101.

• Kumar, S (n. d), 'Impact of Employee Attrition on People Management in Organisations'.

• Marsden, A (2002), 'Handle with care'. Cimansider, July.

• Nagarathanam, R, Venkitasamy, S and Attiah, EM (2018), 'The Impact of Career Development Practices on Employees' Retention in Qatar Aviation Industry', ASCENT International Conference Proceeding - Accounting and Business Management, pp 325-30.

• Shanker, M (2020), 'Recruitment process and its impact on retention of commercial pilots in Indian aviation industry', Business Process Management Journal, vol. 26, no. 3, pp. 736-751.

• Tiwari, U and Shrivastava, D (2013), 'Strategies and Practices of Talent Management and Their Impact on Employee Retention and Effectiveness', The International Journal of Management, vol. 2, issue 4.

• Yadav, V and Mehlawat, S (2011), ' Improving Employee Satisfaction Through Talent Management', International Research Journal of Management Sociology & Humanity,  vol. 2, issue 3, pp. 62-5.

EFFECTIVENESS OF TALENT POOL IN MODERN ORGANIZATIONS.

 

The talent pool is a group of employees who are being trained and developed to undertake organizational responsibilities in the future (Lauby,2018). A famous Chinese proverb says, “Every generation will reap what the former generation has sown”. Stability, integrity, continuous growth and development of organizations, depend on both current employees as well as the future talent. This explicates the importance of building talent and incorporating new talent with necessary skills to align to achieve the future success of the organization (Benoy and Gracias, 2015). Boudreau and Ramstad (2005) said that identifying and developing high potential individuals who are considered as the talent pool is an important concept for the organization. Most importantly they would move into future leadership roles in the organization(Keçecioğlu and Yilmaz, 2014).As per Maragia (2013), “workforce demographics, global competition, mergers, acquisition volumes, and technology” would lead a talent pool to take up leadership responsibilities.

Zuboff (1988) considered talent, as value-adding to the organization. Focussing on the talent pool would be the biggest value for the organization. With the talent pool perspective, the competencies and values of employees are developed instead of developing specific position skills. This leads to successful succession planning within the organization (Lauby, 2018; Keçecioğlu and Yilmaz, 2014). Jiang & Klein (2002) has shown that many organizations pay attention to create “a feeder system”, which can feed management positions with high potential employees. This feeder system is similar to a system like succession planning. Lack of succession planning causes employees to dissatisfy about the organization and results in decreased performance and retention rate (Maragia, 2013).

Training and development is a primary factor for an effective talent pool. According to Pulse talent report, “44% of Companies have a formalized training program for project managers”. By providing required skills and competencies through training and development programs organizations can make a successful talent pool (Benoy and Gracias, 2015). A leading airline in Sri Lanka has a training facility attached to the organization to train and develop the necessary talent, required for the organization. As an advantage of this, the organization could create a talent pool in different fields. Airline ticketing training programs, Aircraft maintenance and engineering training, Airline cabin crew training, Flight Simulator training, Cargo training programs and Travel and tourism training programs are some of the available programs. Details are available in the International Air Transport Association (IATA, 2021) website and SriLankan Aviation College website (SriLankan Aviation College, 2018) . Further to that Srilankan airlines - Aviation college LinkedIn web page, emphasizes "SriLankan's International Aviation Academy caters to manpower requirements of airlines, airports, travel agents, and other aviation industry organizations of both local and overseas" (Linked-in, 2021). Figure 1 shows a picture taken during a Himalayan Airline Cabin Crew Training program. Figure 2 shows, a picture was taken during  Aircraft Maintenance Training program.

Figure 1: Himalaya Airline cabin crew training program.

 (Source: SriLankan Aviation College.)

Figure 2: Aircraft Maintenance Training program - Inspection of Main Landing Gear.

(Source: SriLankan Aviation College.)

As per Lauby (2018), there are four steps, to develop an organizational talent pool.

Step 1: 

Review the organizational strategies and identify competencies required to develop talent pool.

 

Step 2: 

Assess and identify the company's current talent to identify any skills gaps through Performance reviews, assessments and interviews.

 

Step 3:

Create internal and external training and project-based learning that will help employees to learn the skills they need.

 

Step 4: 

Conduct regular talent assessments, observe market conditions, monitor progress, and make regular adjustments. 

The talent pool can be an internal source or an external source (Khzam, 2015). Recruiting employees from an external source like Linked in, Twitter or Facebook is an instance for using an external source (Verma, n.d). Cruz (n.d) has given an example for using an external talent pool to recruit employees in B/E Aerospace, a world-leading organization for interior cabin products, fastener distribution, and logistical services for commercial, business, and military aircraft. As per McCartney and Garrow (2006) and Byham (2002), Either internally or externally the most important thing is having a talent pool that increases employee engagement, cross-company support, personalized growth opportunities, reduces employee turnover, and most prominently retaining talent (Syam, n.d).

List of references:

• Benoy, J and Gracias, N (2015), ‘Strategic Talent Management: A Proposed Model for Building Talent Pipeline of Project Managers’, International Journal of Management (IJM),  vol 6, Issue 7, pp 67-83.

• Cruz, EL (n.d), ‘Data Driven Recruiting’, Linked-in Talent Solutions.

• IATA, (2021), 'SriLankan Aviation College', viewed 3 September 2021, <https://www.iata.org/en/training/courses/partner-network/srilankan-aviation-college/145569/>.   

• Keçecioğlu, T and Yilmaz, MK (2014), ‘An Application on the Brand of Talent Management Perspective’, Journal of Yasar University, vol 9, no 35, pp 6235-44.

•  Khzam, MA (2015), ‘Talent management Research and overview’.  

• Lauby, S 2018, ‘4 Steps for Developing a Talent Pool’, SHRM, 7 June (2018), viewed 31 August 2021, <https://www.shrm.org/resourcesandtools/hr-topics/talent-acquisition/pages/4-steps-for-developing-a-talent-pool.aspx>

• Linked-in, (2021), 'International Aviation Academy - SriLankan Airlines', viewed 3 September 2021, <https://lk.linkedin.com/in/international-aviation-academy-srilankan-airlines-0a620a53>.

• Maragia, S (2013), ‘Effects of Succession Planning Programs on Staff Retention’, Mediterranean Journal of Social Sciences, vol 4, no.6, pp 157-62.

•  SriLankan Aviation College, (2018), viewed 3 September 2021, <https://www.srilankanaviationcollege.com/>.

• Syam, MI (n.d), ‘Impact Talent Management to Employee Performance’ 

• Verma, R (n.d), ‘Role of Social Media in Maintaining Talent Pool’, JayotiVidyapeeth Women’s University, Jaipur, India. 

         

HR TECHNIQUES IN TALENT MANAGEMENT

Focus of this blog is to emphasize the significance of talent management to gain more competitive advantage and how HR practices affect organizational performance and talent management. Human capital is the knowledge, skills, and personal attributes that workforce contributes towards achieving organizational goals.

With the increase in globalization during the pre-covid19 situation, organizations have to operate in a highly competitive environment to archive their goals. According to Wheelock (2010), in the pre-pandemic world, companies were strongly focused on talent management and retention since intellectual capital has always been an asset for any business organization. Which is the reason for many organizations to concentrate their attention on this asset. In the view of Brundage and Koziel (2010), it was highlighted that the talent management strategy must be a continuous process and part of the organizational culture. Appreciation and recognition activities such as compensation, rewards, and leadership training will attract the workforce to the process.

As described in the above paragraph having well trained, talented, and experienced workforce would be advantageous for any organization but the difficult part is to control their turnover in the highly competitive industry environment. As Hussein (2009) describes HR professionals were automatically driven to change their simple administration functions to an object-oriented approach in order to retain their key employees. When analyzing the reasons for employee turnover, Maertz and Campion (1998) defined dissatisfaction in the job role and other job alternatives were predominant reasons but later on Mitchell et al. (2001) indicated several other contributing factors such as social or personal problems that cannot be overcome in the current job context.  Whatever the reason, organizational effort should mitigate this process. As Moncarz (2004) said, employee turnover causes loss of key skills, which intern exerts pressure on the growth of the organization and also it can cause disruptions to operations. Another important point was highlighted by Poe (2003), according him employee turnover can be costly since that leads to new recruitments and selection process which will consume a lot of time, money, and people engagement. It’s clear that employee retention and talent management are very vital for organizational existence in the present competitive era, as Gberevbie (2010) highlighted there is a strong relationship between organizational performance and employee turnover so that talent management is very much important in meeting current and future business objectives.

HR has a crucial role in talent management since it is the core component in any organization which is responsible for managing human capital. The techniques and processors related to talent management may different from section to section within the organization and those techniques/methods can include financial and non-financial awards/rewards, job engagement techniques such as knowledge and skill development training/workshops which will be beneficial for employee’s carrier progression. Overall, it’s a motivational process through different applications which fulfill the self-actualization needs of individuals.

According to Lewis and Heckman (2006), talent management is an important process that consists of several HR practices like recruitment, selection, development and carrier management, employer branding, motivation, and training and development. As Joo and Park (2009), described the HR department can perform talent management via goal orientation and implementation of carrier management programs. Bowden et al. (2006) mentioned how motivation influences talent management and retention via Herzberg and Maslow’s theories of motivation. That theory indeed discusses the internal and external factors where the self-actualization needs are prioritized. So, once those requirements are satisfied, that leads to job satisfaction and will not be concerned about leaving the organization. HR professionals can link this requirement with the management by continuous engagement in personal development and employees well -being. 

Recent HR talent management researchers have identified succession planning and employer branding also as impactful components. In the view of Cultterbuck (2005) succession planning is continuously monitoring the workforce and evaluate their performance for tomorrow's requirements and apply appropriate corrective measures. This kind of regular reviewing process helps for long-term talent retention and to identify future leaders. Employee branding is to discover potential employees as per Branham (2001). According to Thorne (2004), employer branding works as an internal marketing process that gives psychological and financial benefits to potential employees. Moreover, as Davies
(2007) mentioned employee branding not just identify potential employees, it also helps to retain employees and improves their job satisfaction which will eventually leads to organization-wide performance enhancement.

 

Based on the above facts and analysis, it’s evident that HR talent management strategies have a remarkable impact on perceived outcomes in many ways. Especially in the efficiency and productivity of the organization. Employee readiness to serve will be uplifted with loan term sustainability, thus the organizational goals will be attained mechanically.

List of references: 

• Bowden, J, Mactaggart, D, and Martin, A (2006), ‘The Barriers to the recruitment and retention of supervisors/ managers in Scottish tourism industry’. Int. J. Contemp. Hospital. Manage. vol.18, no.5, pp. 380-97.

• Branham, L (2001), ‘Keeping the people who keep you in business 24 ways to hang on to your most valuable talent’. New York: American Management Association.

• Brundage, H, and Koziel M (2010), Retaining Top Talent. J. Account. 209(5).

• Clutterbuck, D (2005), ‘Succession planning: A developmental approach’. Dev. Learn. Organization. vol. 19, no. 5, pp 11-13.

• Davies, G (2007), ‘Employer Branding and its influence on managers’, Eur. J. Market, vol. 42, no. 6, pp 667-81.

• Gberevbie, E, D (2010), ‘Organizational retention strategies and employee performance of Zenith Bank in Nigeria’, Afr. J. Econ. Manage. Stud. vol. 1, no. 1, pp 61-74.

• Hussein, M (2009), ‘Hiring and Firing with ethics’, Human Resource Management Digest, vol. 17, no. 4, pp 37-40.

• Joo, KB, and Park, S (2010), ‘Career satisfaction, organizational Commitment, and turnover’,  intention, Leadersh. Dev. J. vol. 31, no. 6, pp 482-500.

• Kay, C, and Mocarz, E (2004), ‘Knowledge, Skills and Abilities for lodging Management Success’, Cornell Q. vol. 45, no. 3, pp 285-97.

• Lewis, RE, and Heckman, RJ (2006), ‘Talent management: a critical review’, Human Resource Management, Rev. 16, pp 139-54.

• Maertz, CP, and Campion, MA (1998), ‘25 years of voluntary turnover research: a review and critique’ In: Cooper CL and Robertson IT (Eds), International Review of Industrial and Organizational Psychology, London: John Wiley and Sons, Ltd., pp. 49-86.

• Mitchell, TR, Holtom, BC, Lee, TW, Sablynski, CJ, and Erez, M (2001), ‘Why people stay: using job embeddedness to predict Voluntary turnover’ Acad. Manage. J. vol. 44, no. 6, pp 1102-1121.

•       Poe, AC (2003), ‘Keeping hotel workers: it takes more than money to retain lower-paid employees’, HR Magazine, February.

• Thorne, K (2004), ‘One-stop guide: Employer branding’, Sutton: Personnel Today.

• Wheelock, D (2010), ‘Cultivating top Talent at Mercer, Training and Development issue 44 worldwide?’, Int. J. Contemporary Hospital Management, vol. 11, pp 138-9.