GMC is an Australian farm machinery manufacturer, operating since 1975. The company makes high-quality farm machinery and equipment including a range of slashers, mowers, aerators, mulchers and utility components to suit a range of farming machinery and requirements. In the current tight labour market, GMC has faced various difficulties in filling posts. Positions and skills gaps that they are struggling to fill include sales managers, marketing managers, operational managers (senior positions, with planning, management and leadership skills), and high-level technicians and engineers. Sales and marketing managers are the most commonly cited source of turnover problems, due to the wider range of opportunities open to them and the high demand for their services in the industry. GMC's HR Director claimed that there was a significant gap between the output of the educational system and the required labour inputs of companies. In an attempt to recruit a technician, a position which requires the possession of a bachelor's degree in engineering, only 9 candidates out of 50 passed the first selection test. Sometimes they cannot find a suitable person after several rounds of recruitment and selection. GMC reported having posts unfilled for between six and eight months at one extreme, requiring more than three recruitment campaigns to fill the vacancies. High turnover rates of white-collar workers illustrated the seriousness of the retention issue. GMC could spend a fortune on training and developing their management staff only to see them take their newly developed skills and leave the company for a higher paying employer, in many cases a competitor company. As skills are scarce within and across industries, job-hopping to accelerate salary is popular. This situation forces GMC to think twice before making their 'make or buy' decision and determining their training budget.

Question 1: 

Explain to GMC management the arguments both for and against the company adopting a 'make your own' talent strategy by investing in training and development of their existing workforce. In your answer, distinguish between training and development.

 

Question 2: 

As noted in the case, "as skills are scarce within and across industries, job-hopping to accelerate salary is popular",identify and justify what three rewards GMC can offer to help retain their skilled workers. In your answer, discuss the environmental factors that may influence the determination of rewards offered to GMC employees.