Issue link: http://www.e-digitaleditions.com/i/124894
Regional Report finds itself in the top three foreign direct investment (FDI) locations globally. This, coupled with a strong and youthful population demographic means that, unlike China, talent analysts see it as a sustainable market to invest in for both domestic and international growth objectives. The numbers are compelling— 260-plus million people; 27 per cent below the age of 14; 67 per cent between 15 and 60 years of age with a median age of 28. Note, too: The population is 86 per cent Muslim and is the world's third largest democracy. and social reforms, infrastructure challenges, environmental degradation, and over-population. But Indonesia is well placed to leverage its development and increase its global presence. Upon closer interview with a number of global MNCs, that have taken the initiative to enter the Indonesian market place, we found a couple of key questions that need pondering. With this in mind, it is worth noting that Indonesia has an infatuation with social and mobile technology. There's no Chinese firewall here. Indonesians love their technology and have not only jumped on the social and mobile bandwagon, but are whipping the horses with glee. Internet subscriptions grew 25fold in the decade to 2011. There are 250 million mobile phones— yes that's 105 per cent penetration (many Indonesians carry 2 or 3 phones each). Some 76 per cent of Internet users are on Facebook, putting Indonesia in third place behind only the U.S. and India in global Facebook user rankings. And they love Twitter too—an impressive ranking of No.1 for penetration of Internet users tweeting vigorously. The current skills shortage at the mid to senior level in Indonesia has resulted in an overheated job market. Top-tier employers are waging a talent war as they try to secure the best people and salary increases between 20 per cent and 30 per cent are offered to entice people to change employer.2 This should make finding and acquiring talent relatively straightforward. However, closer scrutiny reveals that, like most maturing economies there are many parameters imposed by government policy, geography, language, and education that make a seemingly easy investment decision . . . not so easy. Indonesia's talent management challenges and opportunities need to be explored in some detail. The country and its people are keen and ambitious. Growing pains abound: political [20] HRO TODAY GLOBAL | WINTER 2013 What is the reality on the supply of 'qualified' talent to produce the yield that the incoming FDI is looking for? Other issues include:3 • Although more Indonesians are pursuing higher levels of education, skilled workers are quickly absorbed by the labour market, resulting in a shortage of qualified talent. • Employers must show patience and flexibility in light of many cultural differences that affect workplace performance, such as an indirect communications style, strong group mentality and religious practices. • Indonesian society is strictly hierarchical, resulting in a work environment where senior managers are expected to make decisions and subordinates follow without question or challenge. The high need for skill development in local employees has resulted in significant attention, effort, and funding directed