How Capitec is solving the tech skills shortage from within

In an enlightening session entitled Tech talent mobility: How Capitec is solving the tech skills problem, Eugene Brockman, Capitec’s manager of tech talent solutions, and Suzanne Liebenberg, Capitec’s head of talent management, presented the organisation’s innovative solution to a problem that most HR leaders are forced to face: tech skills scarcity.

Suzanne kicked off the session by giving some context. She said that two years ago, Capitec acquired Mercantile, which was part of the organisation’s strategy to build a business bank and enter the insurance space.

However, doing so would mean significant technology requirements, and these would need to be scaled. At the time, Capitec was bringing in 300 new tech people, with 70 percent of those hiring requirements sitting in the middle and senior management tier. She highlighted that even though Capitec was hiring 40 people a month, they were not keeping up with demand and a new approach was needed.

She then asked the audience if anyone else was facing similar challenges, and many hands shot up.

“We knew that our buy-in strategy wasn’t going to sustain us, especially when it came to scale. But we had a secret weapon – 10,000 frontline employees,” she said.

These employees were working in Capitec’s branch network at contact centres and in the business banking’s relationship suite. According to Suzanne, these employees are “top talent”: they know the clients and products inside out. However, within their own career infrastructures, despite significant promotion opportunities, cross-functionality was a challenge.

The key, said Suzanne, was to unlock their potential. However, they faced a lack of access to opportunities and a lack of experience. These employees were saying that although they’re part of the business, they felt there were no broader career opportunities for them.

So, an innovative internal talent mobility strategy was born. For the first year, 50 opportunities were ringfenced. These were earmarked specifically for internal frontline employees who perhaps lacked qualifications and experience but were not short on motivation and the ability to learn. Capitec would pay these employees a salary for 12 months, while they learnt and developed a scarce skill – like software development and business analysis. A technical and scarce job of the employee’s choice was then guaranteed, they were placed in it, relocation expenses were covered, and lives were changed.

“It was the right thing to do, as employee sentiment said people were looking for growth opportunities,” said Eugene. “We looked at long-term recruitment costs and attrition data, and wanted to bake in loyalty through a career that’ll help people earn more and look after their family. This is the ‘warm and fuzzy’ project. In South Africa potential is everywhere, but opportunities are not. It’s up to us to push talent where they need to be.”

The initiative is now in year two, and according to Suzanne, when the second round opened there were over 1,000 applications. To balance potential negative sentiment – as 950 people wouldn’t make the cut – she added that Capitec leverages strategic people partners, as well as specific career conversations, webinars, and development programmes, so that these employees can apply for the next round or broaden their horizons for talent mobility.

“We never say no; we say not yet,” emphasised Eugene. “In the second year, we’ve seen these people come back and succeed in the second intake, whereas before frontline employees were sitting in branches feeling like this is as good as it gets. We’ve opened that up for them.”

Eugene pointed out that when the initiative was launched it was decided not to increase headcount. “Managers were reticent, and we had to sell the concept and benefits it would bring. As soon as people started to see the potential, they became evangelists.”

Eugene highlighted that when these employees start the learnership, they report directly to their absorbing manager, so they are part of the development journey from day one. The participants have show-and-tell sessions, take part in masterclasses, and they see what a stand-up and sprint cycle looks like. They’re then relocated and integrated into the teams they’ll be working with.

“We wanted to throw criteria out the window and keep it as broad as possible to unearth people who have a passion for this,” commented Suzanne. “It’s a rigorous process; we hire the best. We don’t hire you for the job, we hire you for a career,” she concluded.

Source: https://chro.co.za/articles/how-capitec-is-solving-the-tech-skills-shortage-from-within/

Question 1      (25 Marks)

Examine the key objectives of the Skills Development Act and elaborate on its role in fostering enhanced skills development in South Africa. Furthermore, appraise how this legislation can be strategically leveraged to enable Capitec to meet its Human Resource Development (HRD) needs effectively.

Question 2      (25 Marks)

To ensure Capitec has the right talent to drive its strategic goals, a strategic approach to Human Resource Management is essential. Evaluate how a strategic approach to Human Resource Management can be effectively implemented at Capitec, drawing insights from their innovative talent mobility program and focus on developing internal talent to address skills shortages.

Question 3   (25 Marks)

The case study highlights the significance of retaining the right talent within an organisation to foster ongoing business development. Based on the insights provided, justify when internal recruitment would be most effective, and when external recruitment would offer greater benefits. Furthermore, analyse the advantages and disadvantages of each recruitment method in the context of Capitec’s strategy and talent development initiatives.

Question 4     (25 Marks)

Critically discuss how a continuous training and development approach, as demonstrated in Capitec’s talent mobility initiative, could address the concerns raised in the case study and enhance employee development and retention. Additionally, outline the needs analysis process that could be implemented at Capitec, taking into account both local and global trends in the South African labour market, to ensure the company’s HR strategies align with evolving talent requirements.

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HRM Assignment Answers: Expert Answers on Above HRM Questions

Skills Development Act
Objectives: The main objective has been to enhance the skills of the workforce and thereby increase the chances of their employability, and overall productivity.
Role at Capitec: The role of this act is significant at Capitec as the company can utilise training programs and workplace skill plans to develop the skills of its internal staff who can ultimately perform the scales tech roles and thereby reduce the overall dependency of the company on the outside hiring.
Strategic HRM at Capitec
Implementation: The implementation can be performed by aligning the HR strategies with that of the business goals. The requirement for tech employees can be done through workforce planning, and talent mobility programs can be applied to develop the skills of existing employees. Excellent leadership is important and the company can make investment to enhance the leadership and focus on building long term capability.
Outcome: The outcome will be in the form of having the right number of people with the right skill set to perform the roles at the right time.
Internal versus external recruitment
Internal Recruitment: The internal recruitment is highly effective in utilising the skills of existing employees and it is advantageous as the existing employees are well aware of the culture prevalent within the organisation. It ultimately reduces the chances of turnover among employees. The advantage is cost effectiveness and develops a sense of belief among employees. Disadvantage is it lacks skill gaps.
External recruitment: This form of recruitment is beneficial when there is a need for new ideas or something innovative that cannot be performed with internal employees. The advantage is the better ability to innovate whereas this method is costly.
Continuous training and development
Continuous training and development is essential as it helps in developing career pathways, reduces attrition among employees and enhances their morale which ultimately contribute towards improved organisation’s performance.
The needs analysis process includes performing an organisation’s analysis, task analysis, person analysis and environmental scan. This process will help Capitec in developing HR strategies that would be highly efficient for its future workforce  requirement.

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