The fashion and luxury sector is facing rapid business change and people are at the heart of this revolution. It is widely accepted that companies with well-organised management structures and talent management practices are gaining the competitive advantage.
Yet, within this sector, there is still a significant challenge in finding the right people with the right skill mix to enable successful growth through a phase of major transition and expansion. Leaders of these organisations should apply just as much business knowledge and acumen as creativity, to solve complex organisational and talent management issues.
Key influences on the industry
The globalisation of markets and digitalisation of recruitment methods are two key trends that are driving the need for professionalisation in a sector that is traditionally labelled as a ‘creative’ industry. Only 30 years ago, fashion companies did not compete, in a financial sense, with large companies in other industry sectors.
Nowadays, fashion and luxury companies are key players in the stock market and parent groups of brands are not dissimilar to international companies that seek trade and financial investment to support their growth objectives.
Additionally, the internet has paved a new way for how people learn about companies and apply for jobs – which poses opportunities for new talent strategies. The presence of these companies on the global stage is on the rise and, without the right people in their business, they might struggle to grow and succeed.
The talent challenge: Finding it
The changes in the fashion and luxury sector suggest that new methods of seeking, developing and maintaining talent are required. Importantly, non-creative skills are now a fundamental component to international success. However, the tendency is to rely on traditional methods of head hunters and employee referral schemes, which may constrain the ability to recruit the right skills. The professionalisation of the industry suggests the need for finding the right candidate quicker, and with more continual success, to ensure more effective working at the earliest opportunity.
Existing methods of bridging the talent gap
Industries are bridging talent deficiencies through internal and external methods. Internally, for example, the Deloitte Swiss Watch Industry report 2013 found that the majority of luxury watchmakers focus their talent strategies around in-house training (74%) and offering more apprenticeships (54%) to hone young talent. Some companies have, for the last decade or so, focused primarily on retaining talent.
However, the increasing challenge of keeping hold of existing, and finding new, people means that organisations across the sector are widening their focus to other functions, such as work experience to school leavers. A more extreme alternative is mergers and acquisitions, which have been a key driver of growth for the luxury market. This poses the challenge of maintaining a relevant talent model that is integrated across a more complex organisation.
Many companies see the value of social media sites and have done a great deal of work with networks such as Twitter and Facebook. However, in order to maximise potential, creative industries that want to succeed need to provide the most effective channels of two-way communication with prospective candidates. No longer can they depend on posting openings solely on their ‘careers pages’. In the same way that the customer interacts with the product brand, this can be applied to how employees perceive and relate to their employer brand.
Potential future strategies
Deloitte’s 2014 Human Capital Trends Report outlines five innovative ways to access talent. This can be applied to fashion and luxury industries in a number of ways:
1. Treating recruiting like marketing
Marketing campaigns for fashion and luxury products often seek to inspire dreams and sell aspiration. In the same light, spotting and nourishing the right talent is more important than ever before.
2. Innovate – who and where
An increasingly global presence requires a global talent search. Broadened criteria for successful hires mean that strategic recruiting is key. Sometimes your best people sit in different markets and functions; it is not about looking in the immediate surroundings but looking across borders, perspectives and experience.
3. Use social media communities
The most innovative organisations view social media success as a means to develop robust talent communities. Fashion and luxury companies can leverage their customer networks of people interested in the products, which may in turn result in high-quality recruits.
4. Big data to deepen talent networks
Applying talent analytics can help fashion and luxury organisations to better understand where talent gaps exist and to improve the quality and efficiency of recruitment.
5. Maintain an active and deep candidate bench
Established career paths keep people engaged throughout the lifecycle of their careers. Given the scale and prominence of global opportunities, this can turn candidates from passive to active.
The fashion and luxury sector is differentiated in the talent market due to its unique management structures. Many organisations in this sector began, and remain, as family businesses – creating an additional layer of complexity to solving talent issues.
The talent gaps that exist in these organisations are a true blend of business acumen and creativity, which are required to enable the growth targets of the larger industry groups. Whereas this industry previously focused on harnessing and sustaining the talent of young designers, business management skills are now seen as an equally important criterion for success.
We can expect fashion and luxury companies to evolve and sharpen their business models, ensuring the right people in place is a top strategic priority.
