War for Talents. Apprenticeship versus External Recruitment

Table of Contents

1. Introduction
1.1 The Aim of the Work
1.2 Structure of the Thesis

2. The War for Tomorrow’s Talents
2.1 Definition of Talent
2.2 Apprenticeship vs. External Recruitment
2.2.1 Apprenticeships
2.2.2 External Recruitment
2.2.3 Advantages & Disadvantages

3. Conclusion

4. Future prospects: Increasing effort of recruitment

List of Abbreviations

Abbildung in dieser Leseprobe nicht enthalten

List of Figures

Figure 1: German population from 2010 to 2050

Figure 2: Company appeal and attractiveness

List of Tables

Table 1: Population development in Germany, forecasts from 2010 to 2050

1. Introduction (Marvin Hecht)

Shortage of skilled workers is unaffected by the economy and always an issue especially in the light of trends as technical progresses, globalization, the economic structural change and also demographic trends.¹ In Germany in the next few years because of the current demographic trend a decline in the labor force potential is expected like the following table, the 11th coordinated population projection of the Federal Office (StBA), shows (lower limit/ceiling):

illustration not visible in this excerpt

Table 1: Population development in Germany, forecasts from 2010 to 2050 Source: Own illustration based on Bevölkerungsforschung (2008), p. 20

Workforce declines despite rising labor force participation and immigration.² Furthermore, in conjunction with the recently improved employment situation a trend towards an employee market could become established in the near future. On the one hand companies would increasingly compete for employees with sought after skills and competencies. On the other hand wages are rising in tight labor market segments. Beyond if effective adaptation mechanisms like changes in educational choices, occupational mobility and wage increases do not come to fruition in some areas of the German economy the labor could become scarce. The fear of sustainable bottlenecks increased by the fact that it is already being challenged in certain regions and areas of activity with significant recruitment problems.³

1.1 The Aim of the Work (Marvin Hecht)

This paper deals with the impact of demographic change and the loss of employment to the employee recruitment of German companies. As the figure below presents, 83% of the population of 2030 is already living today.⁴ Related to this there is a negative development of the working people’s age structure. Therefore it will be a growing challenge for many companies to hire qualified employees in the future for continuing to compete in the market and over and above to be competitive.

illustration not visible in this excerpt

Figure 1: German population from 2010 to 2050

Source: Own illustration based on Hofmann (2012), p. 4

In the following we want to describe and discuss the present-day research to the “War for Talents” and especially the apprenticeship versus external recruitment. It will be shown which factors influence the apprenticeship within the company and with what other measures it meets by external procurement in a solution-oriented way. In this connection it is explained in which different extent the respective recruitment acts and which different problems but also opportunities for the company and the employees occur.

1.2 Structure of the Thesis (Marvin Hecht)

The procedure in this work is such that first - in section 2.1 - the concept of “talent” will be defined so as to allow for an easier introduction to the topic of the “War for Talents”. With the help of a first comparison of the external and internal recruitment potential opportunities and risks for the company resulting from the respective recruitment measure are illustrated and points of a competency-based recruitment policy will be highlighted. Finally, in the 4th chapter prospects are given to the current debate on how to deal with the consequences of the demographic change on the labor market and the resulting consequences on the future procurement staff.

2. The War for Tomorrow’s Talents (Julian Thomsen)

During the past century the way companies search for new employees changed extensively, mainly due to the beginning Information Age in the 1980s. At the beginning of the 19th century only 17 % of the workers needed knowledge for doing their job. Today the percentage increased up to 60 %.⁵ The new dynamic demands resulting from the globalization, deregulation and many advances in technology takes the importance of hiring talented employees and managers to a whole new level.⁶ Nowadays the war for talent is not just focusing on hiring and retaining the best graduates from the university but rather on all critical HR sectors.⁷ Once the CEO of Cisco Mr. John Chambers stated “ A world-class engineer with five peers can out-produce 200 regular engineers... ” ⁸. In fact that statement clarifies the enormous potential of gaining not only monetary benefits for a company outgoing by hiring high potential people. But what makes an employee more talented than others? And what are today´s common methods to recruit talented employees? This Chapter gives among others the answers to these questions.

2.1 Definition of Talent (Julian Thomsen)

The word talent is used in an excessive way, although there are several possible comprehensions what talent exactly contains. In the context of this paper the term talent means the intrinsic abilities a person possess for example knowledge, skills, experience, intelligence, judgment, attitude or the ability to learn something in a designated time.⁹ A person with a lot of distinct personal abilities is among other things more capable of challenging the todays tougher and dynamic office routine. The talents which are needed differ from company to company and job to job. So it is from great importance that companies not only hire talented people but also people who fits the most to the talents requirements of the respective occupations and get strategic advantages over the competition. The next section introduces several internal and external methods of recruitments to get the “right people for the right job”.

2.2 Apprenticeship vs. External Recruitment (Daniel C. Klinck, Andreas

Schwabauer & Sven Wittenbr ö ker)

The most important approaches for recruitment of talents can be separated in two main methods: Apprenticeships and External Recruitment. Hereinafter specific types of these methods are elaborated. Furthermore advantages and disadvantages are balanced against each other.

2.2.1 Apprenticeships (Daniel C. Klinck, Andreas Schwabauer & Sven Wittenbr ö ker)

Apprenticeships can be seen as a form of “creating” talents.¹⁰ Therefore the company has a major influence on the qualification of the apprentice. Regarding different initial situations of apprentices there are various types of apprenticeships. On the one hand school-graduates have the opportunity to start vocational training in a company. Based on this the employee is capable of pursuing even higher career qualification by consecutive industrial training (e.g. state certified technician or master craftsman in Germany). On the other hand collegegraduates can apply for trainee or MBA programs that develop special leading skills in order to create the “high potentials” for future leading positions. Additionally internal mentorships complete the designated range of apprenticeships in a company. Hereby veteran employees support novices in business knowledge and general affairs.

2.2.2 External Recruitment (Daniel C. Klinck, Andreas Schwabauer & Sven Wittenbr ö ker)

Whereas all types of apprenticeship create talents, external recruitment deals with the search for talents. In former recruitment strategies companies waited for the perfect applicant to respond to their job advertisement. Nowadays companies are actively seeking for suitable candidates to fill vacancies. Companies use the opportunity of networking in general to reach all kinds of possible employees. On job fairs and also at schools and universities HR departments promote their companies to get in touch with potential employees. Offering internships, diploma theses or even direct entries the company creates a win-win-situation in which both sides profit from a direct commitment. Additionally companies use the service of Headhunting Agencies to get especially high potentials for specific vacancies. In terms of globalization and economic change companies also need to sustain flexibility even in the cost intensive field of HR. Therefore employee leasing provides a cost efficient solution.

2.2.3 Advantages & Disadvantages (Daniel C. Klinck, Andreas Schwabauer & Sven

Wittenbr ö ker)

The major challenge for companies will not only be limited to uphold and expand their potential for success. A leading competitive position within management of talents and knowledge is also to be aspired. As a result companies have to keep in mind all advantages and disadvantages of recruitment methods.¹¹

Hereby apprenticeships as an internal recruiting assure a high identification with the company. Furthermore apprentices get completely familiar with structures, processes and contacts. However business departments within the company are in an internal competition for future graduates. Most prestigious departments will attract high potentials while less prestigious but relevant departments will have problems finding suitable successors. In contrast to the apprenticeships the method of external recruitment implies the opportunity of “new blood”.¹² For this method an initial training is needed to introduce new employees within the company and its unique structure hopefully resulting in new and beneficial ideas and perspectives.

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¹ cf. Hofmann (2012), p. 3

² cf. Fuchs & Weber (2012), p. 7 f.

³ cf. Bonin (2012), p. 5-10, 20, 30.,also Fuchs & Weber (2012), p. 21 1

⁴ cf. Hofmann (2012), p. 4

⁵ cf. Michaels, Handfield-Jones, & Axelrod (2001), p. 3

⁶ cf. Michaels, Handfield-Jones, & Axelrod (2001), p. 4⁷ cf. Suder & Killius (2011), p. 9

⁸ cf. Stevelowisz (2012), p. 1

⁹ cf. Michaels, Handfield-Jones, & Axelrod (2001), p. xii-xiii

¹⁰ cf. Ready & Conger (2007)

¹¹ cf. Fishman (1998)

¹² cf. Terazono (2012)