Purpose - The transformational changes to business environments brought about by the fourth industrial revolution create a perfect storm for strategic human resource management, prompting a need to explore the implications of this context for talent management theory and practice. The paper aims to discuss these issues. Design/methodology/approach – In-depth interviews were conducted with HR directors and senior leaders within engineering-led organisations to explore current challenges experienced across each stage of the talent pipeline: attraction and recruitment, training and development, career development, talent mobility and succession planning.
Findings - The speed of technological change brought about by Industry 4.0 had created a significant gap between current capability of employees and the rapidly evolving requirements of their roles, prompting a need to consider new and more effective approaches to talent development. Middle managers are increasingly recognised as overlooked critical talent within this context of unprecedented change, given their essential role in change management. In addition, whilst lateral hiring remains a common talent management practice, in the case of Industry 4.0 this equates to fighting a war for talent that does not exist.
Practical implications - This study suggests that there is a need for evolution of talent management theory and practice towards a more dynamic, systems-thinking orientation, acknowledging the interrelated nature of different talent management activities.
Originality/value - This paper provides an in-depth insight into the impact of the unprecedented change brought about by Industry 4.0 on contemporary talent management practice, considering how theory and practice might need to evolve to enable individuals and organisations to keep up with the rate of technological change.
Alongside global demographic and economic trends, increasing global mobility and expanding workforce diversity, the transformational changes to business environments and skills brought about by the fourth industrial revolution create a perfect storm for strategic human resource management (SHRM). As articulated by Beechler and Woodward (2009, p. 275), “When all these factors are taken into combined account the result is a constantly changing, challenging and complex environment in which organisations must compete to attract and retain key talent”. Also referred to as Industry 4.0, the explosion of technological advances associated with the fourth industrial revolution includes advanced robotics, augmented and virtual reality, the Internet of Things, ubiquitous connectivity and tracking, Big Data and 3D printing, amongst a raft of other developments. The SHRM literature has long recognised that to leverage strategic human capital, organisations must effectively acquire or develop, then deploy employees to best apply their knowledge, skills and abilities to tasks and processes in line with a firm’s strategic needs and changing environmental conditions (Lepak and Snell, 2002; Becker and Huselid, 2006; Bassi and McMurrer, 2007; Wang et al., 2012). However, the unprecedented pace and scale of change brought about by Industry 4.0 has led to a situation in which technology is increasingly outpacing individuals’ and organisations’ ability to adapt (Deloitte, 2017).