Being the only ASEAN country part of the G20 to this day, Indonesia has known a fast economic growth for the past few years, reaching 5.1% in 2017, and is likely to keep attracting more and more people, for both business and leisure. The opportunities keep growing as its population does, which has now reached more than 260 million, making it the 4th most populated country in the world. Adding the educational progress that has been made and the social gap that has been therefore reduced, Indonesia is now the key access gate to a wide and qualified local talent pool.
The Indonesian population is very young. As the median age is twenty-eight years old, half of the population is still below thirty. Most of them are spread among the main Indonesian cities located in Java and Sumatra, regrouping altogether eighty percent of the population. Big urban agglomerations like Jakarta and Bandung offer promising markets in Retail, Luxury, E-commerce as well as Fintech and IT with the Digital Transformation. Indeed, with more than eighty universities, Bandung seems to be the cradle of future talents, especially in the IT sector with the students from Institut Teknologi Bandung. However, other big players are emerging. Cities such as Surabaya, Medan, Palembang and Semarang have many resources to provide for the retail, agriculture and tourism industries. Tourism indeed seems to have a bright future in Indonesia, which keeps on attracting more and more travellers from all over the world. The tourism and hospitality industries are therefore bound to keep developing for the next few years. To keep up with this development, a real need for infrastructures (harbours, airports, roads, railroads) will stem out.
As these industries are bound to grow in the near future, companies will need to manage their Human Capital efficiently, starting with their Talent Acquisition and Talent Development. Even if more and more students chose the prestigious local universities such as Universitas Indonesia, many others still decide to go abroad, mostly in the UK, the US or Australia. The challenge is then to attract these local, dynamic and well-rounded talents that benefit from both the knowledge of the local market and international standards. Aside from the reputation of the group, recruiting the best candidates requires to be fast-paced, flexible and creative in the processes. Though Talents are not constantly on a lookout, they will tend to move when they get a better offer with better development perspectives. Therefore recruitment starts with an accurate assessment of the skills of the candidates, not only pertaining to their CV but also of their soft-skills to see if their values match the company. Then there must be many discussions and empathy regarding the candidates’ aspirations in order to open career and development prospects that will enable them to project themselves in the company on the long-term.
However, as this talent pool remains very young, companies face another challenge: there is a huge shortage of talents in middle to top management positions, needed to be filled with seasoned professionals who have higher level of expertise in some very specific areas. These ones are not digital natives, less connected and most of the time under the radar.
Companies will need to attract new talents, but not only. They will need to train, develop and retain the existing ones as well. As more and more opportunities will be introduced to these very connected and agile local talents, a real strategy of Talent Development needs to be put in place. Firms need to develop career growth plans for their employees, and incorporate them into their strategy, as Talent centric organizations.
Indonesia is a growing market offering many opportunities and full of potential, particularly thanks to its needs in infrastructure, the width of its internal market, its young population and most of all, its abundance of natural resources. The increasing competition for talents will get the Talent Acquisition market very tense, especially for local ones with international standards. Identifying and convincing the best ones will required a specific and dedicated approach, as well as for internal Talent Development strategy.
As an expert on Talent Management in emerging markets, Lincoln is used to work on those specific situations by developing strong Talents pipelines of candidates and understanding these emerging market trends and leadership opportunities. Feel free to contact us to discuss further about these many different topics.
Annabelle Berger – Researcher, South-East Asia – firstname.lastname@example.org
Leonard Canitrot – General Manager South-East Asia – email@example.com