Paper And Packaging Struggles
2009-12-15
Paper and packaging sector struggles to develop talent, says survey
Drop in demand and global competition expose weaknesses in leadership
A recent survey from executive search and leadership advisory firm Heidrick & Struggles International, Inc. shows that talent tops the list of concerns for executives in the North American paper and packaging sector, with only 4% believing strongly that their talent management is prepared for current challenges facing the industry.
"The talent crisis is occurring at precisely the time when the industry needs leadership the most," says Jonathan Graham, the leader of Heidrick & Struggles' Paper and Packaging Practice, which conducted the survey. The global paper and packaging industry is roughly $600 billion.
"As we head into 2010, paper and packaging companies are facing severe challenges on all sides. On top of reduced demand and skyrocketing costs is a global movement to develop more sustainable materials, spurred by events such as the Copenhagen climate conference. And these pressures are compounded by a hypercompetitive global environment as supply chains further expand into Asia," says Mr. Graham.
Key survey findings -- Talent and costs share top spot as primary concerns among executives: While materials cost has been a widely known drag on industry profits, the survey found that executives shared as great a concern about talent - ranging from hiring and firing practices to succession planning.
- Enormous gap between the perceived importance of talent and the ability of companies to address it: "While 73% of executives strongly agree with the importance of better talent management, only 4% are confident that their company's talent can meet challenges sufficiently."
- Human resources seen as one of the weakest company functions: "This neglect in attracting talent will likely compromise the effectiveness of all corporate roles," says Mr. Graham, "further weakening competitiveness."
- Companies overlooking important talent sources: "The industry knows it can no longer afford to keep ignoring talent development, but it must be more creative about where to look for the next generation of leadership. Instead of trying to compete for talent with consumer products companies, for example, the sector should be looking to find up-and-comers from areas such as the specialty chemical and other business-to-business industries - places where innovation and technology are thriving."
"Companies in this rapidly-changing sector need to develop their 'people supply chain' in order to survive - at every stage from entry level to the top," says Mr. Graham. "And, to effect the greatest change, companies can elevate their HR head to the C-suite. Creating a 'Chief Human Resources Officer' can help companies think more strategically about their talent beyond the more mundane human resources function. Ultimately, the solution is about innovation - in talent and in technology."
Heidrick & Struggles surveyed two primary groups from a variety of paper and packaging materials companies: P&L holders/general managers, such as CEOs or division presidents; and top human resources executives within companies. Paper and packaging materials companies included manufacturers of paper, converted paper and paperboard, plastic (both rigid and flexible), glass, and metal. The total number of survey respondents was more than 75 executives.
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