Brain drain of execs leaving cosmetics firms for Google… but the grass isn’t always greener
L2 conducted an analysis of employee migration patterns between consumer goods manufacturers and digital companies and found P&G, L’Oreal among those affected, along with Unilever, Estee Lauder, and LVMH.
According to the study, over 600 digital professionals at P&G and more than 300 at L’Oreal left their jobs for Google, Facebook, or Amazon, and almost no one is going back.
Unilever has seen just fewer than 300 employees follow suit, while the numbers are lower for Estee Lauder and LVMH, at 39 and 29 respectively.
“The challenge facing organisations undergoing digital transformation is how to attract and retain key digital talent. While some companies promote digital professionals from within, others recruit externally; all compete with major technology companies in the ensuing war for talent,” says L2 Founder Scott Galloway.
Not moving fast enough?
Many of the big players in the cosmetics industry have announced the growth of digital as central to their plans with the likes of L’Oreal, P&G, and Unilever all refocusing their strategies to take advantage of this; however this has not stopped some from moving on.
According to L2’s Insight Report on The Digital Organization, nine in 10 organizations are undergoing a digital transformation, but just 14% believe they are moving fast enough.
Furthermore, L2 says there are major disconnects between employees at different levels, with 39% of surveyed CEOs saying the company’s pace of digital transformation was “about right” while 64% of managers thinking their organisations were moving at a “slow” or “very slow” pace towards digital transformation.
The main stumbling block for digital transformation appears to be talent, according to 59% of executives, as only 19% of businesses believe they have the people needed to develop and map a digital strategy and just 15% believed they have the skills and capabilities to guide a digital strategy.
As a result, L2 says a war for hiring has broken out among organizations.
Grass not always greener
However, it is not so black-and-white, as consumer goods firms are not completely powerless in retaining their digital talent.
According to L2’s report, of Fortune 500 companies, Amazon and Google have the shortest employee tenures. With their expansive resources, they can afford to make hiring mistakes, and compensation is performance-based as well.
As a result, the media turnover rate at these companies is one year vs P&G’s average tenure rate of 6.7 years, according to L2; meaning that to retain digital talent, brands must think about investing in recruitment, restructuring compensation, and areas in which to maintain a differentiated competence.
