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Headhunting is no longer a barbaric pursuit

10 October 2007 Gareth Stokes

If you thought headhunting was the preserve of ancient tribes dwelling in the Amazonian basin, then think again. The practice is alive and well in the corridors of South Africa's corporate giants. FAnews Online has heard many stories from local insurance and healthcare companies complaining about the practice.

In pre-colonial times, the term headhunting referred to the practice of removing a persons head after killing him or her in battle (or some other pursuit). The term's modern application is to the process of finding suitable people to occupy key positions in a business organisation. Recruitment agencies often draw up lists of candidates who they think are suitable for a high level position before telephoning them individually to try and convince them to change jobs. They usually find out if the 'target' is happy in their current job and then offer them more money to take a similar position with another company.

Although the practice is usually the preserve of high power jobs, headhunting soon moves down the pecking order when skills are in short supply or where training similarly skilled individuals is expensive.

The fight to retain skilled executives

Companies are all too aware of the threat of headhunting to their operations. For this reason executive salary increases in the latest year have recorded a high 7.4% of gross salaries. This information emerged from an annual poll conducted by Human Capital at Deloitte. The report titled "The SA Guide to Executive Remuneration and Reward" confirmed that the average increase in executive remuneration in South Africa was above the expected 6% to 7% range.

Despite these higher remunerations, more than 31% of respondents claimed losing staff to 'poaching' as affirmative action appointments were 'stolen' by other companies. In our view this trend will increase as various companies face legislative deadlines for implementing employment equity plans.

Turnover of top staff is also reason for concern. South Africa's CEO resignations mirror the global trend with Deloitte recording the "average executive turnover for the period reviewed, between August 2006 and July 2007, at 10.5%." A large part of this senior staff churn is due to emigration driven primarily by better employment opportunities and the fear of violent crime. The survey reveals that 33% of emigrating CEOs sited better employment opportunities and 25% crime as their reason for leaving.

Education is an absolute mess

This corporate reshuffling would not be of such concern if there were adequate skilled individuals to fill the gaps. But there are not! And more than ten years into our new democracy the reason for this shortage is not difficult to pin down. South Africans (citizens and government) have no respect for education.

We write this newsletter against the backdrop of unrest at some of South Africa's higher education institutions. Student protests against fee increase have resulted in violence, intimidation and the usual damage to private and university property. This is not something we expect to see from future 'skilled' citizens. While the right to freedom of expression is entrenched in our constitution these students would do better to focus on ensuring that the education they receive is on par with that in the rest of the world. The sliding education standards would make a far better platform for meaningful student process...

The situation in South African schools is just as appalling. Instead of focusing on quality education and improving teaching standard, government has simply improved the pass rate through a series of standard lowering exercises. What is the point of claiming education success when you end up with a bunch of illiterate high school diploma carriers trashing local universities?

Step up to the plate

In yesterday's newsletter  we revealed that a major shortcoming of financial services companies in meeting the objectives of the Financial Services Charter was in skills development. It seems 2014 is the target date for most of government's ambitious social development objectives. This gives the private sector more than eight years to get their house in order. If large companies in the insurance and other financial services areas don't take positive steps to tackle training and skills development today, we will face serious problems in the future.

Companies who believe they will be able to address skills shortages in the couple of years leading up to 2014 should take a page from Eskom's book. The state electricity supplier has suddenly realised that it takes more than a few years to remedy a power shortage years in the making. New supply cannot be created overnight. Skills cannot be created overnight either. And if corporate South Africa wants to remain competitive in the global market, they are going to have to step up to the plate and shoulder some of government's responsibility in educating the masses.

Editor's thoughts:
There are some telephone calls you dread receiving; but the headhunting call does not fit in this category. Many hard working corporate 'minions' dream of the day they receive such a call, confirming their skills and services are in demand. Have you been headhunted before and did you remain loyal to your company or accept the better offer? Send your story to
gareth@fanews.co.za

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