Talent2’s Competitive Edge

Linda Merritt, HRO Research Analyst, NelsonHall

The NelsonHall HRO team recently spoke with Mary-Sue Rogers, Talent2’s global general manager for HR managed services, for an update on the major Asia-Pacific, pan-regional HRO service provider with ~2.6k clients across 30 countries. Its client base includes companies of all sizes in both the private and public sectors. The company had a busy fiscal Q4 2013 winning more than 60 contract awards across its service lines, including payroll, RPO, learning and HR advisory services.

The Asia-Pacific HRO Market is Competitive

Asia-Pacific is a huge and diverse region with many of the individual nations still considered “emerging markets,” with opportunities for long-term growth. Talent2’s in-region competitors are largely global HRO providers, some span all service lines and others go head-to-head-on a single service like RPO.

So how does a ten-year-young company compete with many of the biggest names in HRO? Its competitors also have in-region locations but find it hard to match Talent2’s 40+ HRO-dedicated locations supporting 31 languages in 16 Asia-Pacific countries, including parts of the Middle East. In May 2013, Talent2 further expanded its operations in support of the Asia-Pacific region by opening a service delivery center in the Philippines.

Succeed With a HRO Competitive Edge

It is a core part of providing multi-country services to offer local subject-matter expertise on employment rules, regulations, taxation and compliance reporting, and all of the competitors can provide such services directly or through vetted local partners.

Talent2 demonstrates deep knowledge of local regulations as well as cultural and business environments. It knows the nuances that others may miss, which can help develop a service offer that is right on the mark for design and cost. For example, in the first instance, Talent2 addresses the following questions:

• What style of payroll service center support is preferred by employees in different areas of its region?
• What are the differences in an MNC headquartered in the West versus one headquartered in the target region?

As a result, 50% of its clients use multi-country services led by payroll and followed by RPO. Some start with one targeted country and add more over time.

Quality services and competitive pricing, along with its deep knowledge, provides a winning combination for Talent2, achieving a NelsonHall estimated ~10% growth in FY 2013.

Then Change to Remain Competitive

Talent2, which became a private company in 2012, is working its way through its stated development roadmap. The multi-pronged plan is focused on upgrading and rationalizing its technology platform to meet current and future client needs and going environmentally green to control internal costs and lower the total cost of ownership for its clients.

HR services are changing rapidly all over the world, as are client needs and interests, and no service provider can long rest on its laurels. Therefore, the question arises: does your HRO service provider’s competitive edge match your needs today, and will it tomorrow?

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ManpowerGroup Latin America Analyst Event

ManpowerGroup Solutions held its first analyst event outside of the U.S. in Mexico City to focus on the fast-growing Latin America market which includes Mexico and Central America (MeCA), and South America. I must first say the hospitality extended to us by both the Latin America and U.S. ManpowerGroup teams present was the warmest I could have imagined.

The agenda included:

• Introduction to ManpowerGroup MeCA
• Talentism is the new capitalism: ManpowerGroup insights from the World Economic Forum
• The economic landscape in Mexico and Latin America
• ManpowerGroup priorities, progress, and perspectives
• The RPO and MSP market in MeCA
• Visit to ManpowerGroup client and ManpowerGroup office (particularly helpful to understand how jobs are advertised in Mexico)
• Labor and workforce demographics in South America
• ManpowerGroup brand, messaging, and target markets
• The global RPO COE
• Analyst perspectives on topics including: client readiness for global talent planning, client satisfaction, and ManpowerGroup strategies

With such an informative agenda, I’d be writing a small book if I tried to cover all the content, so I’ll focus on the client visit to KidZania. KidZania is a global organization with franchises in Mexico. It is opening its third office there by June, which we were able to visit. KidZania is focused on creating a live learning experience for kids that allows them to role-play adult activities including working different jobs, spending money, and even learning how to drive a miniature car after acquiring a permit. The facility is Disney-like, but better because adults are not allowed inside. ManpowerGroup also has its first job agency within KidZania, so kids can assess their skills and search for jobs available on computers.

ManpowerGroup Solutions began providing RPO services to KidZania in 2010 after the client was searching for an agile vendor that could provide a flexible workforce solution with a focus on talent. The client stated the following three primary objectives of which ManpowerGroup has exceeded its expectations:

• Find the right candidates fast
• Reduce time / cost of recruitment, including quickly scaling up and down to meet hiring needs
• Create the right culture among kids, parents, and collaborators.

I’ll revisit the Latin America market in a future blog, but for now I will say that although Mexico had one of its biggest recessions in 2008 – 2009, it has made a quick recovery, and is expected to create ~1.2m jobs this year. Mexico is about more than just outsourcing for labor arbitrage; it is about outsourcing for job skills where more than 100,000 engineers and technicians graduate every year from science and technology programs. Just last month, for example, Volkswagen’s Audi luxury-car unit announced that it will open its first North American factory in Mexico.

ManpowerGroup has more than 2,000 clients in MeCA and is present in 10 countries in South America. RPO is provided to both Mexican headquartered clients and U.S. MNCs with hiring needs in Mexico.

Gary Bragar, HRO Research Director, NelsonHall

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