Southeast Asia (ASEAN) has been growing economically at an impressive rate. With its projected GDP growth rate of 6-10% per year versus the global average of 3-4% in the next 5 years, the region is on track to become the fourth-largest economy in the world by 2030. Having a literate population of 600 million and an even larger young working population where 40% are under the age of 30, the digital economic boom, perpetuated by emerging digital businesses and the digitalisation of traditional industries, signals a significant spike in demand for skilled and qualified digital talent.
As per the strong ICT market growth rate of 1.4x – 1.8x, there will be an aggressive demand for digital talent, which needs to be met in order for ASEAN to accelerate its position as an economic powerhouse in digital.
Why tech talent is still in high demand in Southeast Asia despite the tech winter
However, according to a survey conducted with 600 startup employees and 40 startup leaders across six ASEAN countries, 9 in 10 startups face challenges in recruiting tech talent and 91% of employees are open to leaving their existing positions, making the challenge of developing a sustainable recruitment strategy and scaling their teams remain ever-present.
In collaboration with Southeast Asian venture capital firm Alpha JWC Ventures with global consultancy firm Kearney, we put together a playbook based on the survey to help companies battle for the best and brightest.
The right recruitment strategy to meet different demands across stages
Depending on the present stage of the company, employers will undoubtedly have to adapt their hiring strategies. For example, in the early stages of product validation, the company’s focus for hiring would often be to build their product & technology, marketing and business development teams to gain traction amongst their target audience.
Once they’re in their later stages and have a dedicated user base and steady streams of revenue, the focus shifts to market-share dominance, diversifying their revenue and profitability. Thus, they would be looking to make stronger C-level hires while building up their data analytics teams to drive expansive business and market opportunities.
Additionally, the key challenges for companies differ between the different stages with early-stage firms facing a greater problem with compensation while later-stage firms and corporates face a greater problem with perceived corporate branding.
Notably, when it comes to talent retention, the top reasons for employees to consider new opportunities include competitive rewards and compensation (32%), misalignment with company and vision (25%) and lack of growth opportunities (23%) with companies in each country differing on their most selected reason.
For early-stage organisations, their employees are most likely to leave for new opportunities due to misalignment with company and vision while late-stage startups are more likely to lose their talents due to competitive rewards and compensation.
Hence, the first step towards building a successful recruitment strategy is to understand your current situation and tailor your strategies accordingly to your hiring needs.
Culture as the foundational cornerstone of recruitment strategies
Apart from tangible rewards of compensation (78%) and employee benefits (68%), the firm’s culture is highly valued by employees as the 3rd most important aspect of a job (57%). Getting the culture right also helps companies to address the 2nd driving factor for talent exits- misalignment with company vision and culture (25%), which is also the most selected reason for leaving by employees in Singapore and Indonesia.
While highly intangible, culture has very tangible impacts such as improving financial performance and customer satisfaction due to increased productivity and firm margins and higher dedication to customers due to having more motivated and committed staff. The resulting improvement in employee engagement also sees increased job satisfaction and a decrease in turnovers.
Open communication through the means of encouraging 1-on-1 dialogues between employees and formal mentors and senior executives, leaders empowering their team members to offer their ideas and speak their minds, as well as having a company-wide discussion around big conversations go a long way in building a culture that allows employees to feel welcome, accepted and respected.
In particular, leadership has the key responsibility of setting a company’s culture and setting a positive note for the firm. Leaders should implement a reiterative feedback system with employees to help reduce the risk of misalignment while middle management is pivotal to creating team cultures, executing firm values and communicating employee feedback to upper management who are then able to translate the collated feedback into actionable suggestions for improvement. Having frequent open-feedback cycles with employees and within teams helps keep everyone on the same page, working for the betterment of the company while ensuring the needs of the employees are still met.
Giving the right incentives to attract and retain: Tackling compensation and rewards
Unsurprisingly, compensation is the highest-ranked aspect in a job by 78% of employees and is the number one reason for 32% of employees to pursue career opportunities elsewhere. Employers are expected to provide desirable and appealing benefits packages to attract and retain top talents in their organisations.
Good compensation principles should be competitive, merit-based and encourage long-term loyalty. By having regular benchmarks for salaries and variable pay incentives as a reward for good performance, companies can leverage different compensation structures, especially for early-stage startups that may not have the luxury to offer generous salaries to their talents such as equity or employee benefits.
For 68% of employees surveyed, employee benefits were the second-highest-ranked aspect of a job. These benefits include HR-related benefits such as medical coverage, personalised rewards for birthdays and work anniversaries that recognises each employee’s individuality to employee development benefits by offering consistent upskilling and development opportunities, mentoring and offering them flexibility in their career options.
Furthermore, it’s become more crucial to offer talents plenty of opportunities to grow and enhance their skills, especially with the lack of growth opportunities being cited as the third primary driver of talent exit. Whether companies choose to do so by investing in tailored learning and development programs or simply allowing them time off to pursue such courses, firms can maintain their competitiveness by providing an avenue for their talents to flourish and consistently develop their abilities.
However, more than simply offering such benefits, organisations need to be able to communicate the details and the value of their compensation packages as many employees may not understand its value. From the use of the offer letter, and long-term incentive plan documents to employee onboarding handbooks, the effective communication of the rewards packages gives clearer visibility, understanding and transparency of the package value while increasing employee motivation.
The key to winning the talent war
Ultimately, the art of developing one’s recruitment strategies can be puzzling and daunting with the copious amount of moving parts to keep track of. In order to succeed and effectively grow and scale teams in the new era of the workforce, it is increasingly paramount for companies to tailor their recruitment strategies to their employees. From compensation and employee benefits to adapting their company culture in order to create cohesive employee branding, organisations are at a pivotal point where they are able to still make effective changes to attract, retain and engage tech talents.
This article titled “Building blocks to growing and scaling talents amidst Southeast Asia’s talent battlefield” was written by Paul Endacott CEO and Founder of GRIT
About the author
Paul is a highly driven leader who has been operating in the fields of recruitment and executive search since 2002. With a proven track record within global multinationals and regional organisations, Paul has experience of turning around underperforming operations and scaling businesses from start up to over 150 employees. Paul’s last corporate role was Regional Managing Director, Asia, for an Australian Listed recruitment firm where he was responsible for the Asia strategy as well as leading Digital and Innovation.
Most recently, Paul has launched his own Venture/Angel backed company, GRIT, that specialises in Digital and Technology. This is a recruitment technology organisation that is driving a recruitment and executive search solutions platform to provide greater value and engagement with organisation and talent communities.
Paul is highly passionate about digital and technology and how it can be utilised to advance the recruitment and staffing industry.
Based in Singapore, Paul has extensive experience of the Asia markets as well as the UK.
In addition to the above, Paul is an Advisor at Antler, supporting their HRTech cohort globally and also a Mentor at Workplace Accelerator.