Please read the following case and then answer the two questions at the end.
Equipping for the future
Many employers facing industry job shifts also are confronted by workforce changes due to retirement of key executives and employees. One firm that has 'drilled' well in the oil equipment and services industry is National Oil-well Varco (NOV). Based in Houston Texas, the firm has over 20, 000 employees working in manufacturing, selling and servicing oil and gas equipment.
Several years ago the CEO at NOV, Pete Miler, recognized that all of the senior management executives were baby boomers. The CEO realized that many of these executives would be retiring about the same time, so NOV would face a significant vacuum of talent to be replaced. Two senior executives were given the assignment to prepare for the changes, resulting in a plan labeled 'next generation'.
To generate a supply of potential leaders, technical professional, and others, NOV had to broaden its recruiting process beyond the normal oil-based states, such as Texas, Louisiana, and Oklahoma. Miller also demanded that foreign candidates be considered, because of the expanding global oil market.
A specific focus of NOV recruiting efforts included foreign students at US universities who had high English communication skills and other relevant capabilities. Up to 40 individuals at 10 universities were interviewed and then the primary candidates went through two more interviews by NOV middle managers. Those candidates who passed this phase spent two days in Houston going through additional interviews and selection means. Finally the individuals selected were offered jobs at NOV. this process has continued during the past several years.
Once the selected individuals go to work at NOV, they spend one year in job rotation, with four assignments of three months each in different business areas. This rotation provides the individuals with a broader view NOV and its operations. During the rotation, candidates participate in various efforts, including development programs and mentoring by various division managers.
A unique part of NOV's talent management process is that after the individuals complete there one year job rotation, they become draft candidates. Modeled after the national football league draft each business unit identifies which individuals they want on their team. After completing the draft, individuals get jobs in the different business units.
NOV's next generation program has been successful. The retention rate for the drafted candidates is over 90% higher than normal in the industry. Also, its recruiting costs have declined. So there has been a payoff for both NOV and its employees.
1. Discuss how NOV's efforts combine different phases of talent management to reach a successful result.
2. What are some of the possible advantages and disadvantages of the 'draft approach' to placing candidates in business units?