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ABC Coal Talent Management Plan
Contents
1.1 Business situation at ABC Coal 2
1.2 talent management situation. 3
2.3 maintenance electrician. 7
3.0 Talent management resolution: focus on the mining engineer and maintenance fitter. 11
3.1 Sourcing, attracting and engaging employees. 11
3.1.3 Measures that ABC Coal must take to meet employment needs in the next five years. 15
1.0 Introduction
1.1 Business situation at ABC Coal
ABC Coal is an Australian mining company that is involved in the mines, produces and markets high-quality coal for the Australian industrial market. The environment in which the company operates today is characterized by rapid change, increasing uncertainty and tightening labor markets. In order for the company to survive in such an environment, talent management is an undertaking that should be emphasized.
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While a lot of important is nowadays being attached to talent management, there is inadequate understanding and agreement on what it should entail in practice and how to do it effectively (Lewis & Heckman, 2006). This paper presents a case study of ABC coal whereby an analysis of various talent management issues in the company is made. The main purpose of this report is to identify the workforce issues and risks faced by ABC Coal as well as provide recommendations on how to mitigate them.
1.2 talent management situation
At ABC coal, preference is always made to fill positions internally first. When hiring externally, experienced applicants are also given preference. Additionally, historically, the company maintains a graduate/apprentice ratio of 1:10. The primary channels of recruitment for the company include external recruiters, web-based career centers, and the company’s own website. The internal recruitment team is organized into four categories:
- Maintenance and processing,
- Mining operations,
- Professional roles, and
- Statutory roles
The company’s human resource management personnel also send representatives to attend job fairs and university graduate days. For purposes of training, the company has invested heavily in a simulator and many associated conversion kits. For this reason, new employees can experience the operations of heavy equipment before commencing on work at the mine site. In the past, the company has always maintained an implicit focus on professional roles and dragline operators. However, recently, the company has been on the receiving end of pain as a result of the difficulty in getting quality in the most strategic trade roles, which are fitters, boilermakers, and electricians.
2.0 Talent management issues: focus on five main roles: Mining engineer, maintenance fitter, maintenance electrician, mine surveyor, geologist
The different talent management issues analyzed in this report include demand, internal supply, external supply, gap, and capacity summary. Additionally, the various talent management issues arising with regard to criticality and capability are assessed. This report focuses on five main job roles that are of strategic significance for ABC Coal. These job roles include mining engineer, maintenance fitter, maintenance electrician, mine surveyor and geologist.
2.1 mining engineer
Within Australia, the employment growth for these mining professionals is expected to stay within the 13% mark every year over the next 5 years. Therefore, the demand for mining engineering graduates is expected to exceed the national supply. Although international migration will continue to be an important new labor supply source, there are deep-seated concerns over the extent of transferability of mining engineering skills to Australian conditions of various overseas applicants.
The role of mining engineers is highly valued in the Australian mining industry. Mining engineers’ core tasks include conducting preliminary surveys of various minerals and preparing plans for chambers and tunnels. They also identify mine locations, assess them and supervise the work of constructing of mine shafts. Additionally, it is their responsibility to ensure that all processes are safe.
Mining engineers need to have qualified with a bachelor’s degree plus the relevant experience. Licensing or registration may be a requirement in Australia. Mining managers with minimal skills may need to be subjected to long training times in order to attain high certification. The minimum experience required is two years while the maximum is four.
The role of a mining engineer is a very critical one. The importance of the role becomes more overt as new mining projects are being undertaken. In terms of capacity, various issues emerge relating to the retention and attraction of qualified staff with the necessary experience. In terms of capability, ABC Coal continues to face significant issues as a result of the shortage, the long training time and requests for a higher certificate.
The 13% annual growth that is expected in employment by mining engineers over the period of five years to come is too low compared to the 84% growth in positions that were recorded over the previous 5 years. In the next five years, ABC Coal will need 20 mining engineers. Additionally, in 2008-09, the supply of graduate mining engineers will increase in correspondence with increasing enrolment during 2004-05. The vast majority of these mining engineers are already employed.
Industry reports indicate that there are very few applicants who have the requisite skills and mining industry training and experience to support their job applications. Additionally, in terms of capacity, the task of staff retention remains a critical issue. High consideration of the gradual increase in graduate mining engineers deserves special attention.
2.2 Maintenance fitter
The expected timeframe for one to gain qualifications as a maintenance fitter in Queensland has recently been reduced to 42 months, down from 48 months. This reduction has greatly contributed to an improvement in the flow of new professionals into the industry. However, there was a decline in trade training commencement in 2008. It is expected that state-wide skill shortages will be a source of worry for HR managers in many mining companies such as ABC Coal.
Apprenticeships remain one of the commonest pathways of entry into the maintenance fitter’s career. In 2008, there was a sharp decline in the total number of recorded trade training commencements, a scenario that saw commencement retreat to the levels that had been recorded in 2004. This outcome threatens to undermine the supply of qualified maintenance fitters in the near future. Inter-firm mobility is cited as beneficial to the industry because a broad range of skills is accessed this way. However, such practices may be one of the causes of a reduction in the return on investment that is associated with employee training.
With regard to internal supply, the termination rate remains low at 4.6%. This implies that, at the current level in ABC Coal, it means that 22% (13 out of 63) of the existing employees would leave. One of the causes of termination is an increase in the competitiveness of the labor market. Within the next five years, the number of retirements expected is very low (2 retirement cases only).
Externally, the supply is expected to be extremely low mainly because of an increase in the number of new construction mines as well as additional one that is already in the planning stage. For this very reason, it is expected that there will be a shortage of 70,000 skilled employees by 2015. This trend is also reflected in the increase in demand for skills in different construction industries, where significant growth has been witnessed in recent times.
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The role of a maintenance fitter was ranked seventh among the number of permanent vacancies that were reported in 2008. Additionally, over 50% of the entire workforce within this category has less than 5 years remaining in the tenure with their current employer. In summary, this is a critical job role whose importance lies in the fact that equipment continues to wear and tear. Additionally, the demand for equipment continues to increase as mines become deeper.
2.3 maintenance electrician
Projections at ABC Coal as well as the entire industry suggest that the demand for maintenance electricians will continue to increase. As part of the skilled and experienced staff members, maintenance electricians are some of the difficult to place. In 2009 along, employers rejected 83% of all applications as unqualified for lack of relevant experience, yet by 2012, ABC Coal will need to employ 57 new maintenance fitters. By 2015, this demand will almost have doubled, hitting the 100-mark.
This is a position that is of moderate value, whose core tasks include installation and maintenance of electrical systems. Maintenance technicians are also responsible ensuring that there is a faultless supply of power from generators to various plant and accommodation units. They need an AQF Certificate III, including an on-the-job training of at least two years in order to be considered for the job. However, without three years of relevant experience on top of all formal qualifications, many employers may be reluctant to consider the applicant for the job.
The training lead-in time is estimated to be around two years, during which time the maintenance electrician will have gained satisfactory exposure and understanding of various projects. Although current employees’ knowledge skills should fill the requirements with the role, new hires often need to be trained for a long duration in order to get on board. In recent times, demand for the skills possessed by maintenance electricians has been increasing. It is expected to continue increasing until after ten years when this demand will start to slow down.
The shortage in these skills is currently being experienced not just at ABC Coal, but across the country. According to an assessment done by local recruitment consultants, the demand for this role is likely to continue increasing both in the short-term and long-term. In terms of overall supply, a forecast improvement is expected mainly through an increase in electrical tradespersons and apprentices who choose to move into more specialized roles.
In terms of age distribution, 56% of all professionals in this field are aged between 30 and 49, 22% are under the age of 30, while 22% are aged above 50. In conclusion, this job role is considered important because the continued operational utility of electrical systems in the mining industry is fully dependent on the efforts of these professionals. The highest termination rate is expected in 2014 and 2015 respectively, whereby 10 and 13 employees are expected to terminate their employment at ABC Coal.
2.4 mine surveyor
The increase in demand for mine surveyors is mainly due to growth in the entire mining sector. This growth is not being matched by a corresponding increase in the people joining the profession. Although graduate throughput has increased, supply challenges are expected to persist as long as the growth in mining initiatives remains high.
This role of mine surveyor is considered to be of moderate value to the mining business. The main tasks done by these professionals include the design and compilation of map manuscripts using graphical and digital source material. Mine surveyors also advise engineering professionals, architects, environmental scientists and other relevant professionals on different technical requirements that relate to mapping, surveying, and spatial information systems.
A mining company such as ABC Coal should not have any difficulties placing a mine surveyor. The ideal candidate for the job only needs to have a diploma or degree in mine surveying technology, which can be acquired at the university, school of mines, technical college or institute of technology. Additionally, no on-the-job training or any formal qualification may be needed. If a company has difficulties filling the demand gaps due to the unavailability of enough surveyors in the labor market, on-the-job or in-house training can be a useful way of solving this skill problem.
The internal supply of mine surveyors is such that the termination rate remains very significant at 12.5 %. At the current levels, 37.5% of all ABC Coal’s current employees would leave. The existing competitiveness in the labor market is the main cause of the increase in termination. For this job role, retirement is not a major issue. Meanwhile, the threat for a mining company facing a major shortage is real, a situation that can be exacerbated by termination and competitiveness in the labor market.
External supply for mine surveyors is lower than demand. Between 20004 and 2005, the number of commencement in mine surveying-related degrees fell sharply (there were 100 new graduates in 2004 and only 43 in 2005). Apart from limited new graduate outcomes, the current and forecast demand growth in these skills is expected to create serious supply challenges in the near future. This will expectedly lead to bidding wars for skilled staff, growth in wages and opportunism among mine surveyors who are in high demand.
2.5 Geologist
The level of experience among many geologists remains insufficient for the needs of the mining industry. Only 15% of all applicants have been considered to be suitable for the job. The strong growth in the medium-term level is attributed to growth in the resource and mining sector. A geologist is considered to be of moderate importance in the mining business. His work is to conduct preliminary surveys of petroleum, mineral and natural gas deposits. This professional also prepares and supervises the process through which scientific papers and laboratory reports are produced. Moreover, he carries out exploration work in order to ascertain the resources presently through sampling and examining.
In order for ABC to be safe from a shortage of geologists, an increase in 5 geologists is needed and this increase should be maintained over the next five years. While doing this, the company’s HR officers should hunt for a bachelor’s degrees or high qualification holders with a minimum of 2-4 years of relevant experience.
The external supply of geologists and geophysicists is being hampered by knowledge, skill and experience deficit among job applicants. Over the next five years, the growth of the geoscientist workforce in the medium-term consideration is expected to be rather low, at only 2.8% within the next five years. The deficit can be traced to the decrease in the number of high school students studying earth sciences during the 1990s. Currently, the category of geoscientists is ranked third in the total number of permanent vacancies being reported.
Of great concern to ABC Coal is the fact that the existing sample of geoscientists remains comparatively young, thereby possessing the lowest length of service compared to all the other five critical skill sets. However, employment for geophysicists and geologists is expected to record a slight growth within the next five years. Generally, geologists belong to a small occupation, at 6600 in November 2009, a figure that represents a slight fall in members of this profession in the last five years.
The internal supply remains quite satisfactory, with high retention initiatives achieving a ‘zero’ termination rate. At ABC Coal, retirement is not a major problem since only one employee is expected to have retired by the end of 2013.
3.0 Talent management resolution: focus on the mining engineer and maintenance fitter
3.1 Sourcing, attracting and engaging employees
3.1.1 Maintenance fitter
ABC Coal is a very generous employer to both experienced and apprentice maintenance fitters. In light of the existing difficulties in placing maintenance fitters, it is important for each mining company to establish an employment setting brand. The best brand is one that is established through reference to three main elements of talent management:
- attraction
- retention
- engagement
In each of these elements, some measures are relevant only to experienced maintenance fitters while others are only relevant to apprentices. Yet others are common to all professionals regardless of their level of expertise.
For experienced maintenance fitters, this brand can best be built through:
- instituting safety training measures
- publishing no-fatality statistics
- offering family-friendly facilities
- paying well
- Offering work-related incentives.
The termination rate for maintenance fitters presents a very worrying trend, whereby more and more people are expected to terminate their employment during the next five years. For instance, whereas 3 maintenance fitters are expected to terminate their employment in 2011, 13 are expected to do the same in 2015. In order to remedy this situation, apprentice maintenance fitters need to be attracted, retained and actively engaged in the task of building the ABC Coal brand.
ABC Coal can build a good brand that attracts apprentice maintenance fitters, mainly through taking care of the employees’ safety, their wellbeing, performance, and productivity. The best strategies for achieving this goal include job rotation, offering in-house quality training and mentoring programs, and working with highly experienced staff.
The role of a maintenance fitter is very critical in all project plans and expansion initiatives. Current experienced employees can be of great help in the design and presentation of training programs. Additionally, new hires should be developed through mentoring and coaching. If need be, experienced staff may be borrowed from both local and international sources.
The retention measures that are common to both experienced and apprentice maintenance fitters include facilitation of peer recognition, provision of employee referral bonuses, support through community services by employees, social events at, during or after work, sponsorships of local teams and transport assistance.
3.1.2 Mining engineer
Although the role of the mining engineer is a very critical one, ABC Coal continues to face very complicated issues regarding the placement and retention of satisfactorily skilled professionals. Additionally, a significant gap risk is being created because of long training time, requests for higher certificate and unpredictability of future supply and demand forecasts.
In order to deal with these problems, ABC Coal needs to come up with an implementation approach whose core element should be an expansion of a pool of available skills, the increment of the hit rate, and orientation of new employees. The company should also assess the needs, offer training, offer development, and build alliances. Engagements with consultants are also required for purposes of outsourcing and carrying out involuntary outplacement tasks.
Integrating various dimensions is a great way of attracting, retaining and engaging experienced mining engineers. This is a great way of reducing the risks relating to employee turnover, especially considering that the voluntary termination rate, at 13.3% remains one of the highest for any type of workforce. The implementation of all the dimensions adopted should be analyzed from the viewpoint of both the organization and the community. For instance, in order to retain the mining engineer, ABC Coal should implicitly highlight the various community-based benefits that he will stand to lose by quitting.
For inexperienced mining engineers, the main community benefits that need to be provided include social events such as:
- Barbeque services
- entertainment events (such as Saturday movies),
- support community services such as competitions,
- free transport to various sporting events and
- Promotion of employee involvement in the activities of the local schools if they show such interest.
The most important retention measures for experienced mining engineers include free transport to major cities within and outside Australia, free, high-quality entertainment facilities, home-buying assistance, promotions without the need for transfer and local transportation assistance.
Retention alone is not enough; mining engineers also need to be engaged in order to derive a sense of ownership of the tasks that they may carry out all their productive lives. The most important ways of engaging mining engineers include:
- Emotional engagement- this can be achieved through reward and recognition, pay satisfaction, adequate resourcing, and job design.
- Work environment- this can be achieved through proper communication, rational engagement,
- Learning and development training –proper leadership, and efficiency in supervision and proper implementation of on-the-job learning schedules in order to reduce the turnover rate.
3.1.3 Measures that ABC Coal must take to meet employment needs in the next five years
In the case of the maintenance fitter’s role, the company will face an employment gap of -52 while that of the mining engineer will be -12. This is a worrying situation that needs to be addressed. Priority should obviously be put to those roles that present a graver deficit risk.
In order to attract new maintenance fitters and mining engineers, the company needs to make the best use of advertisements, head-hunters, employment agencies, newspapers, radio, and TV. Additionally, different means of outsourcing should be used. These include:
- Employee referrals
- Career websites (such as LinkedIn and ex.Seek.com),
- The ABC Coal website,
- Recruitment from competitor’s channels, and
- Workforce diversity (such as recruitment of female employees)
4.1 Recommendations
The demand for various job tasks in the mining industry is high while the supply is low, with the conspicuous exception of mine surveyors. A wide array of factors has contributed to this situation. Some of these factors include forecasting of shortage in supply, high costs of training, opportunism among the limited workforce and growth in the mining sector.
There is a need for proper internal and external supply forecasting. This measure should be undertaken in anticipation of the risks of future termination. Emphasis should be put on professional roles, particularly those of the maintenance fitter and my engineer, where internal supply is predicted to remain low within the next five years. This can be achieved through a differentiated workforce plan, whereby forecasting is done through considerations of termination, retirement, demand, gap analysis, skill changes and long lead-in times.
The impact of various changes in the mining industry in terms of growth of the sector, government policy, and stricter skill requirements should be accurately forecasted. Such forecasting should be done using data from the previous five or ten years. These accurate forecasts should form the basis of the formulation of corrective talent management plans.
5.1 Conclusion
In summary, talent management is a very important aspect of the HR function in the mining industry. ABC Coal, like all other Australian mining companies, faces a difficult task of managing talent in order to boost the existing human resource capability. This report highlighted various issues and risks faced by ABC Coal. Then, recommendations were made on the practical aspects of talent management that should be applied at ABC Coal.
Emphasis was put on the roles of the maintenance fitter and the mining engineers, two critical areas that are at the heart of many deep-rooted talent management issues. Generally, it was noted that whereas there has been a recent increase in the flow of these professionals into the company, there was a decline in trade training commencement over the last two years. Using such information, attraction, retention, and engagement strategies were highlighted that would prevent any future shortage of skills.
References
Lewis, R. & Heckman, R. (2006) Talent management: A critical review. Human Resource Management Review, 16(2), 139-154.