Global Talent

Management at
Novartis
Group 3:
Aasma Bhasin
Atithi Rath
Sanchari Majumdar
Shilpi Hota
Sunil R Prasad
Q1. Critique the idea of internal sourcing of talent.
The most important factor is to select the right candidate for the job. Internal
sourcing may be cost effective in short run but it can also be risky in the long
run. The internal candidate is already familiar with the organizations culture,
reporting structure, policies etc. Also the organization has invested a lot to

groom the candidate in line with the business requirement. Hence the cost of
on- boarding and orientation will be nullified and time will be saved. Also with
internal sourcing the remaining employees are also motivated to perform
better so as to be in the same place. Internal sourcing is a part of succession
planning which is driven by performance oriented organization.
There are also disadvantages and risks associated with the internal sourcing
of talent. The position of the person who is promoted will again have to be
filled; hence it can be a longer process to execute. The chances of external
candidates bringing fresh perspectives and industry best practices to the
organization diminish leading to stagnant point of views. Unlike internal
candidates, external candidates bring innovative ideas and creative skills to
improve business standards.
Though the right selection process depends upon the urgency of sourcing,
available talent pool, strategic importance and various other factors, hence
both internal and external talent must be scrutinized before making the right
choice.

Q2. What is a TM creed and how did Vasella apply it?

Talent Creed is a set of core principles of the organization, its values and
mutual expectations that guide the behavior of an institution and its people.
These principles depict the type of culture an organization strives to create
and achieve its USP. These principles are embedded in the strategy of the
organization and drive every aspect of business in the organization.
Vasella created a TM creed which was based on High Performance.
Everything (compensation, training, etc.) was based purely on performance.
It was carried out through the following:
1. A completely pay-for-performance model where compensation is based
only on performance.
2. Manager Training Programs to equip them to be able to shape the
talent of their teams so as to enhance performance.
3. Global sourcing of talent to ensure a good exposure and to stress the
fact that performance will be rewarded.
4. Competitive salaries and perquisites which are of global standards.
5. Taking into account the potential rating of a person along with his
normal review.

Q3. High performers try the hardest things and tend to fail. If so,
how will you insulate your TM plan against this danger?

To ensure that high performers continue trying the hardest things and
not be afraid to fail, the TM plan should incorporate the following:
1. Milestones can be created in the lifecycle of the project. So in cases
where only the final product is needed and the project fails at the last
moment, though the final output cannot be taken further, the effort put
in can be quantified by the number of milestones achieved in the
course of the project. (This is especially true in the case of
pharmaceutical industry)
2. The intention/breakthrough being pursued should be evaluated (only
for extra positives for the employee and not whether it worked or not).
So in case its a paradigm shifting intent/discovery, it should be
actively encouraged and not be made a part of the review process.
Complete freedom is the key and it must be provided.
3. The ability to innovate should be actively identified in employees and
must be fast-tracked in order to identify potential high performers and
insulate them from normal review processes. (a separate review
process for them can also be formulated)
Q4. How did Vasella face the talent crunch and turnover challenges
in China?
A.
Talented applicants were often young with little experience in
multinationals. Also when they joined Novartis, they would learn their best
and leave the organization within a year or so for better profiles and pay
grades by using the brand name of the multinational Novartis. This would
cost the company as its time and money gets spent in training them before
utilizing their productivity. Even at the lower rank of R&D, the salary was
rising over 10% per year which became difficult for Novartis to find and
retain the talent. The already existing talent at company was also draining
to outside offers with higher salaries. There was also 20% turnover in sales
and other departments.
Vasella faced the challenge of turnover for scientists and senior managers by
negotiating salary and stock grant programs with multi-year vesting periods
as well as offering long term educational support and flex time for those who
stayed at the company. They sent 48 Chinese employees to part-time
programs at Beijing Universitys business school. This education benefited as
one of the most promising mechanisms for reducing turnover and developing
talent.

The company structured one companywide salary band for both returnees
and local hires and to pay educational and transitional assistance to
returnees in one lump sum payment.
Ultimately all these practices reduced the turnover from 20.1 % in 2006 to
17.6 % in 2007.