As of writing I have sufficient distance from the recent ERE Global Expo to get some perspective on everything that I absorbed.

As visitor from faraway China my interest was a bit mercenary so Microsoft China's presentation grabbed my attention immediately. I had a fair idea that I would get inside knowledge from a company that has a reputation for getting it right in China.

I wasn't disappointed. 

The presenters were Danielle Monaghan, HR Director China for Microsoft, and Patrick Sullivan, Staffing Director for R&D, and they started off with a quick overview of Microsoft in China. Far more interesting though, was their understanding of the talent landscape in China.

As you might imagine, their main demand is for software engineering professionals, both individual contributors and managers, and they have two options: buy or build. The buy option includes interns, experienced domestic hires, campus recruitment and experienced international hires. Building is an important pillar in their talent acquisition strategy but it has to be balanced with the skills shortages in the China market.

The interesting part was that in order to get a handle on the supply/demand balance they basically use a competitive intelligence methodology and the data was illuminating.

According to research, China has about 1.8 million software developers, which is about 60% of the US market. The percentage of developers that are qualified for interview at Microsoft is about 1%, compared to 5% in the US. They are very-fussy-people, as you might expect.

This is clearly not good news for China but these figures will improve by 11% in the US and 16% in China, so the news for the future is a little better.

Unfortunately, this ties in well with the broader McKinsey study which estimates that only 10% of the university-educated engineering workforce in China with less than 7 years experience are suitable to work for multinational corporations. This is based on quality of education, English proficiency and cultural fit for the MNC. 

(The flip side of this is that it is important to note that immigration issue and economic opportunities are tending to lure developers back to China, where investments by multinationals are growing. So the solution to the problem is already engaged.)

Microsoft sees itself as competing for talent with a very wide variety of companies and industries. The competitive intelligence piece here is very well developed and drills down to a detailed mapping of industries and companies. For some of their competitors they probably know more about their internal structure than those companies do themselves. Except of course for competitors who are performing exactly the same competitive intelligence exercises (we all know who they are).

But the bar has been set, and set high.

Graduate Recuitment

On the graduate side, Microsoft is also busy, but not with all and every university in China. They find that the blunderbuss approach doesn't work very well so they have a well-defined group of universities that they work with more intensively.

They use quite a funky approach to recruitment advertising and seem to be well ahead in this area. They are open about the fact that in the past they tended to assume that everyone would want to work for them, so they have worked hard to change the perceptions that people hold about them.

It seems odd to say but the situation is that Microsoft were in the past a relatively unknown or confusing employment entity in China. This is a normal problem in China but it is more commonly associated with mid-sized players or industrial companies that have no retail brand.

End Game

The focus that Microsoft has on talent management tends to align all the stakeholders in the process, to their mind. They are known for having very robust methods in their hiring process and an interview with Microsoft in China is likely to take an entire day. Everyone gets a say in the hire and conflicts are managed with well thought out rules and regulations.

From their point of view, this process ensures their internal businesses are able to forecast more accurately, can have intelligent conversations with stakeholders, and recruiting can staff up and commit to a hiring target. They feel they can create a better onboarding experience for employees and execute better on key people development.

So we can say that they have taken the talent management approach to its logical conclusion and have a clearly defined Candidate Value Proposition(CVP). This is based on matching up the desired attibutes for an employer in China with what Microsoft actually deliver on the job.

Their turnover rate, at 6%, is the end result, and in China this is nothing less than phenomenal.   

(Note:  I don't work with Microsoft in China, and have no vested interest in their success, but I can confirm the processes and procedures that they describe. I should also note I was a presenter ERE Global in Amsterdam.)