India critical to global strategy, says Spencer Stuart's Jordan Brugg, but warns of executive talent crunch

The Indian talent market is of significant strategic importance in terms of future growth opportunities, said Jordan L Brugg, Chief Executive Officer at global executive search and leadership advisory firm Spencer Stuart.

“We have a strategic focus on the India market…The future is really bright from a talent pool perspective as far as India is concerned,” Brugg said in an interaction with ET’s Rica Bhattacharyya and Maulik Vyas. However, he added that companies in India may have to be much more strategic in talent planning as a lot of competing demand over a limited executive pool is creating near-term challenges in the marketplace.

The Indian leadership talent market is going through a lot of competition driven poaching and CXO churn. What are the kinds of opportunities and challenges you see in a talent market like India?
India is of strategic interest for us and historically it has emerged as an important market for us in the last 10 years. The other reason for India being strategically important is what we foresee in terms of future growth opportunities.

There could be near-term challenges in terms of talent demand-supply mismatch; but there are huge long-term opportunities too.

The future is really bright from a talent pool perspective as far as India is concerned. In the near-term there is some real challenge in terms of how the growth of tech companies, the growth of public markets and the rise of private equity that is creating a lot of competing demand over a limited executive pool.

However, I don’t think that creates pessimism. It actually creates more demand for talent strategy and advisory as opposed to just pure recruitment. This will have implications on how companies invest in talent development and succession planning.

There is also a huge global talent pool of Indians who have gone out and can come back to India at a later time. It will be crucial how companies’ plan their recruitment strategy to attract this pool. Transfer of talent from one industry to another will also be a critical piece.

Thus companies that are running their businesses in India have to be much more strategic in talent planning.

What kind of leaders are companies in India looking for – especially keeping in mind the rapid pace of tech and AI-led disruption post-pandemic as well as fairly prolonged macroeconomic headwinds and geopolitical tensions?
There is a strong desire among companies to figure out how to ride the AI wave at the same time how not to subject the company to risk. There are a lot of tough questions being asked around what AI really means for businesses.

Cyber security, technology, and AI have been more about agility – organisational and individual leadership agility. The actual business planning that is being done now is in much shorter cycles than before – the ability to pivot and change that’s what most boards are spending their time talking about. How do you assess someone’s ability to demonstrate that agility and how do you select leadership that can foster that across enterprise are in focus.

Our hypothesis is that the highest-performing CEOs are those that bring an open mind to learning, experimenting, to trial and error and getting the organisation to work in that sort of fashion and not necessarily bringing a playbook or a bias as to how things are supposed to be run.

There is a big focus on having leaders who have a lot more empowering style, who can engage and inspire an array of stakeholders.

Do you see companies in India taking their succession planning process beyond the top leadership level?
Succession planning is being used for broader purposes than just who is the next CEO.

As organisations have grown more complex and as speed of decision making has changed, we are also seeing a growing recognition that it is the team that creates success not just an individual. This has changed the way the Boards view succession planning.

How has Board searches evolved over the last few years?
There is a big emphasis on board members who are thought partners to management on business objectives, while being careful not to step into management but much more active in terms of advising and supporting the nature of business.

This springs from the fact that companies are trying to grow faster and there are newer executives who are in roles in which they may not be able to draw decades of experience, so they are leveraging expert executives to help accelerate their thinking and planning around very specific business objectives.

There is a much bigger emphasis on linking strategy and business objectives to the hire even at the board level.

For some companies it might be cyber security, AI or digital element and for others it might be a supply chain expert or an HR and talent expert. So we are seeing companies going outside of their own personal networks to tap into expert individuals who are truly independent and are bringing something to the table that would be linked to their value creation plan.

There is a lot more proactive thinking about the constitution of the board and building a diverse board that can support the long-term strategy of the company and bring that outsider perspective and bring about the right questions.