The Republic of Kazakhstan (hereafter referred to as Kazakhstan) is the largest in territory of the former Soviet republics , excluding Russia, is the ninth largest country in the world and has the strongest performing economy in Central Asia. It is the world’s largest landlocked country equal to that of Western Europe , strategically linking the fast-growing markets of China and South Asia and those of Russia and Western Europe by road, rail and a port on the Caspian Sea (The World Bank 2017). It also shares borders with a number of smaller countries, such as Kyrgyzstan, Uzbekistan and Turkmenistan. This strategically advantageous location is one of the key success factors of Kazakhstan. Thus, the World Bank has provided a number of loans throughout the years in support of various projects that include agricultural development, environmental protection, health and general infrastructure and capacity building. The country has also received billions of US dollars in sovereign and non-sovereign loans from the Asian Development Bank to finance upgrades to transport networks along the Central Asia Regional Economic Cooperation transport corridors and, as a result, strengthen regional trade and economic integration (Export.gov 2016).

In less than two decades after the collapse of the Soviet Union, the country has managed to change its status from lower-middle-income to upper-middle-income mainly due to its huge reserves of oil and natural gas. Meanwhile, due to the protracted slowdown in global oil prices, a decline in real wages, and weak domestic demand , gross domestic product (GDP ) growth has decelerated after 2013 compared to that of the previous years, specifically, before the financial crisis of 2008 –2009 (Sarsenov and Urazov 2017). Heavy reliance on the revenue from oil products and, as a result, fluctuating oil prices in the international arena have led the country to lose its ability to effectively plan financially leading to contracting GDP and budgetary deficits (WorldAtlas 2017). Consequently, the vulnerability of the economy to external shocks is considered the major source of risk (WorldAtlas 2017). A macro-economic adjustment is required to fit the new realities that would address various financial sector issues and foster the development of an export-oriented and productive private sector in order to transform the country economically toward sustainable growth (Sarsenov and Urazov 2017). Here, the long-term development challenge is to reduce the country’s reliance on natural resource extraction, making the economy more diversified and competitive and increasing the significance of the private sector (The World Bank 2017). There is deeply rooted government corruption and an under-developed bank loan system, which block entrepreneurial spirit from flourishing.

The World Bank data show that throughout the past 60 years the population of Kazakhstan has increased, with a short period of decrease after the collapse of the Soviet Union. The population density is relatively low (The World Factbook 2017). Nearly half of the country’s population is part of the labor force. According to the International Monetary Fund , the unemployment rates in Kazakhstan have declined rapidly since 2000 due to the country’s robust economic growth (International Monetary Fund 2014). In particular, youth unemployment has substantially fallen (Trading Economics 2017) after the government’s targeted intervention (e.g. an expanded vocational and the training system has been implemented to create employment opportunities for youth) (Nesporova 2015). Another feature of the Kazakhstani labor market is gender equality —the current legislature supports female workers, thus reducing income inequality and boosting economic development (the Law of the Republic of Kazakhstan of November 16, 2012 No. 50-V ratifies the Convention on equal treatment and equal opportunities for working men and women). Nevertheless, since the onset of the global crisis the relationship between job creation and economic growth has weakened variously in different sectors of the economy, including manufacturing and agriculture. The country lacks effective mechanisms of labor market regulation , while social benefits are inadequate compared to more developed countries (e.g. due to the plunge in oil prices, salaries of workers were reduced) (Nesporova 2015). Moreover, long-term employment elasticity in Kazakhstan is relatively low, which is due to a capital intensive economy being dominated by the oil sector and an under-developed private sector (International Monetary Fund 2014). The International Monetary Fund lists several factors contributing to lower elasticity of employment to GDP , some of which are the over-sized public sector negatively affecting labor market efficiency , excess demand for workers with higher and vocational education and excess supply of workers with general secondary school education (International Monetary Fund 2014).

In order to ensure sustainable growth and become more dynamic and “anti-fragile”, Kazakhstan needs to set an ambitious structural reform agenda that would highlight its competitive advantages: access to different natural resources, a large territory, a favorable geographic position (a “bridge” between West and East) and legal development. The key priority areas must include strengthening human capital and institutions and lowering the role of the state in a more diversified economy (International Monetary Fund 2014). Considering the fact that Kazakhstan, unlike Russia, has made smaller and more careful steps toward achieving its long-term objectives (e.g. when shifting from the Soviet command economy to a market one), the country’s talent management landscape today is relatively more homogenous compared to that of the other Commonwealth of Independent States (CIS) countries.

There are some talent management issues that Kazakhstan has to deal with due to its Soviet heritage. Specifically, talent attraction and recruitment are a serious concern for Kazakhstani organizations (Davis 2012). Even though companies operating within the country’s borders have tried to give up their outdated Soviet recruitment practices in favor of the more effective Western ones, they still employ a variety of practices that significantly differ from those implemented by Western European and American firms (Minbaeva et al. 2007). In particular, Kazakhstani companies try to attract and eventually hire those candidates who were recommended by friends, colleagues, family members or acquaintances (i.e. recruiting is realized on the basis of “word of mouth”). Moreover, companies tend to give promotion to current employees rather than hiring new workers for open positions, even though there is a pool of new recruits better suited and more qualified for the job. However, attracting and recruiting foreign specialists is difficult due to an inefficient use of state quotas for foreign workers and various bureaucratic procedures (Anderson and Hancilova 2011; Yessengeldin et al. 2015). Nevertheless, large Kazakhstani companies do have a rigorous recruitment process, but some of the stages in the selection process that should ensure fair hiring based on merit are considered to be redundant and omitted (Minbaeva and Maral Muratbekova-Touron 2013).

Talent development practices implemented by Kazakhstani organizations are similar to those of their Western counterparts. Nevertheless, the general motivation behind the realization of training and development activities differs for local and foreign firms. Most Kazakhstani companies, excluding small and medium size firms and multinational corporations, invest in development programs for their high-potential employees only because they have a legal obligation to do so (set by the government). Meanwhile, performance appraisal procedures are not as popular in Kazakhstan as in many European countries and in the United States because of socio-cultural issues (Minbaeva et al. 2007). For instance, the 360-degree technique is usually not practiced in Kazakhstani organizations (Minbaeva et al. 2007), which can be explained by relatively high power distance in society, in other words, when individuals conform to a hierarchy where everybody has a certain place. (Many Kazakhstani companies actually try to preserve a vertical organizational structure even when it does not benefit them.)

Clanism seriously affects talent management implementation in Kazakhstan (Minbaeva and Maral Muratbekova-Touron 2013), but its influence varies from one organization to another. In state-owned companies , for instance, the effect of clanism is strong, meaning an employee’s success at an interview or further promotion depend on his or her social capital, while in private companies and international organizations this effect is rather moderate and even low (Minbaeva and Maral Muratbekova-Touron 2013). Nevertheless, due to the increased competition caused mostly by private and international firms entering the Kazakhstani market that aims to attract the best employees to gain a competitive advantage, more and more people without special connections get employed by state-owned organizations. To avoid nepotism and other pressures, human resources managers develop formalized recruitment processes that are strictly regulated. Meanwhile, though discrimination by age and gender is generally prohibited in Kazakhstan, many headhunting agencies set various constraints and barriers for certain groups of workers. In particular, a number of organizations prefer hiring younger candidates and recent graduates, offering them, at the same time, smaller salaries (Smirnova and Tatibekov 2013).

Young workers, having been exposed to Western ways of thinking and conducting business as a result of advanced globalization, demand changes in the employer-worker relationship, which additionally facilitates renovation of the working environment . Consequently, in terms of innovative managerial solutions Kazakhstan is indeed leaving the past behind and moving toward a more stable and positive future. To expand the topic further, we proceed with a review of specific Kazakhstani firms (specifically, KAZ Minerals, Kazzinc and Tengizchevroil) and their talent management systems. We show that despite the dynamic but steady economic growth of the country’s economy, talent management practices are still in transition from those inherited from the Soviet era to the ones that currently exist in Western multinationals.

KAZ Minerals: Strategy in Action

Having a market capitalization of US$2.0 billion as of January 1, 2017 KAZ Minerals is currently known as one of Kazakhstan’s highest-profile and fastest-growing companies listed on the Kazakhstan, London and Hong-Kong stock exchanges (KAZ Minerals PLC 2017a). This UK-based copper company operates in the natural resources industry through five segments, the East region, Bozymchak, Aktogay, Bozshakol and Mining Projects, all engaged in mining and processing of copper and other metals and the development of metal deposits and processing facilities in Kazakhstan (Financial Times 2017). Over the past couple of years it has built a strong track record of operational performance: in 2016, for instance, the company completed the construction of two major Greenfield projects thus successfully delivering on its promise to become a high-growth, low-cost producer.

KAZ Minerals has had a long journey to reach today’s success. Though the company’s operations began at the Balkhash copper smelting complex in Kazakhstan in the 1930s, KAZ was officially established in 1992 after the collapse of the Soviet Union (KAZ Minerals PLC 2017b). An organization known as “Kazakhmys” for over 60 years becomes “Zhezgazgantsvetmet”, an open joint-stock company fully owned by the Kazakhstan government. Such an ownership structure, however, does not last for long—within a decade the government’s stake was reduced from 100% to zero through a series of privatizations. In October 2005 the company joined the wide range of international mining firms listed on the London Stock Exchange. In January 2010 it received funding from the China Development Bank Corporation for the first of two growth projects. A month later it sold 50% of its Ekibastuz GRES-1 power plant to the National Welfare Fund Samruk-Kazyna. In 2013 the company became a majority free-float company by offering certain shares to Eurasian Natural Resources Corporation (ENRC) shareholders.

The year 2014 became a landmark for the company. Firstly, it decided to focus on copper mining and approved the disposal of its 50% stake in the Ekibastuz GRES-1 power station. Later that year, independent stakeholders of this smaller and more-focused group commence a major restructuring which resulted in the disposal of a number of producing assets in Zhezkazgan and the Central regions of Kazakhstan. Some US$240 million was transferred as working capital to the Cuprum Holding, a company owned by a well-known businessman in Kazakhstan, Vladimir Kim, resulting in the formation of a new privately owned company, originally called Kazakhmys (Kayakiran 2014). Following completion of the restructuring, the remaining part of the group, consisting of mining and processing assets in the East region, Bozymchak (the new mine and concentrator in Kyrgyzstan) and the three Major Growth Projects (Bozshakol, Aktogay and Koksay), was officially renamed as KAZ Minerals PLC. In the following two years, KAZ started production of its two major growth projects in Aktogay and Bozshakol.

The company’s mining operations are successfully managed due to having access to all of the necessary inputs, such as natural resources, power, water, transport, end markets, licenses, labor and finance. KAZ Minerals sells its products to customers in China or Europe, depending on available pricing, and the rewards are shared with its key partners and stakeholders: customers and suppliers, local communities , the government and people of the Republic of Kazakhstan, employees and lenders. Nevertheless, there are a lot of material risks that have to be addressed in a timely manner to prevent harm to people and the environment.

According to the company’s annual report (KAZ Minerals PLC 2016), these risks include geological and technological challenges, natural phenomena (resulting in damaged or failed equipment and unplanned expenditure), political instability or social and economic changes in the countries in which it operates (again, negatively impacting its business, financial performance and license to operate). Moreover, world supply and demand for copper and investor sentiment (the company is heavily dependent on commodity prices for copper, gold, silver and zinc that can fluctuate significantly) are also significant factors, as are fluctuations in exchange rates and inflation (leading to increased costs), a high exposure to China (treatment and refining charges are dependent upon Chinese smelting capacity and the level of copper concentrate supply in the region), and health and safety incidents (resulting in production disruption, financial loss and reputational damage). In addition, failure to identify and manage the concerns of local communities and labor unions (affecting reputation and social license to operate), non-compliance with legislation and environmental laws (resulting in regulatory challenges, fines, litigation and ultimately the loss of operating license) play a part. And finally, the inability to attract and retain highly skilled personnel (resulting in higher operating costs to recruit required staff) is of concern. KAZ’s business strategy is strongly supported internally. It encompasses delivering major growth projects, optimizing existing assets and taking advantage of further natural resource opportunities in Central Asia, by enabling the company to access capital, reduce operational costs, build relationships with regulators and local communities , and manage talent (KAZ Minerals PLC 2017c).

The overall goal of KAZ Minerals is to enhance social and economic development by running safe and efficient operations that meet regulatory requirements and international standards, contributing to the economy of Kazakhstan through taxes, employee remuneration and spending, and finally, improving health and safety performance , as a safe workplace is the minimum employees and contractors expect. In order to reach this goal the company annually reviews its corporate strategy. Currently, the Board has agreed on the following (KAZ Minerals PLC 2017c): developing as the leading resources company in Central Asia (the company’s vision) by delivering value for shareholders and maintaining a strong social commitment to its employees, community and the environment (the company’s objective). The company’s strategy encompasses three main areas (KAZ Minerals PLC 2017c): delivering growth projects over the next two years, employing optimization programs aimed at improving efficiency of all assets and operations, and acquiring natural resources in the Central Asia region to maintain a long-term project pipeline.

KAZ Minerals sees its employees as one of its key stakeholder groups: it acknowledges the critical role a highly skilled workforce plays in sustainable competitive advantage . Therefore, it is highly committed to training and developing its workers, incentivizing them to stay with the business and ensuring safe working conditions, providing fair pay and benefits, an open dialogue with management and a workplace culture which respects equality and diversity at all levels of the organization (KAZ Minerals PLC 2017d). As of year-end 2016 KAZ Minerals employs approximately 13,000 workers (KAZ Minerals PLC 2016), the overwhelming majority of which are local residents, whereas the remaining minority are foreign nationals in Kazakhstan who are employed by the company to address short-term skill shortages and gain from particular areas of expertise. Therefore, its talent management practices are aimed at two groups of employees: international and local talent. As for overcoming gender issues, the company is proud to state that female senior managers have a high representation in what is a small but significant part of the workforce (KAZ Minerals PLC 2017e). We can observe a persistence of elitist talent definitions—although, formally, the company tries to focus on all of its employees when conducting talent management practices—as a selective group of high-performing and/or high-potential foreign talent is offered special treatment. KAZ Minerals is highly dependent on its ability to attract skilled personnel. Failure to do so could have a negative impact on operations or the successful implementation of growth projects and result in higher operating costs to recruit required staff. The remote location of some operations increases this challenge. The company, however, recognizes the high migration levels in the Kazakhstani labor market: work applications are submitted to the company from all over the country, which means that people are ready to work not only in the region of their permanent residence. The key pull factors are: (1) a competitive salary which is, according to KAZ Minerals’ research on the mining industry (KAZ Minerals PLC 2017f), higher than the average wages in Kazakhstan; (2) the possibility of working on the newest equipment; (3) opportunities for career growth and development; (4) provided accommodation; and (5) relocation costs and various expenses are covered by the company.

Considering mining is a hazardous industry, involving heavy equipment and harmful chemicals, another important pull factor for the company is its safe and productive operating environment . Skilled managerial and specialist staff are offered safe working conditions, fair remuneration in line with market rates of pay and social benefits packages for themselves and their families (KAZ Minerals PLC 2016). The company actively promotes its safety culture based on risk awareness and its implemented policies and procedures designed to identify and monitor risks and minimize health and safety incidents (KAZ Minerals PLC 2017g). For instance, workers exposed to health risks are monitored by medical specialists; all employees regardless of their occupation are guaranteed medical examinations (when hired) and annual checkups to prevent, detect and treat occupational diseases.

All employees, regardless of their country of origin, are required to use the latest technology and be familiar with the best practices. The company aims to select the most qualified candidates, but for foreigners the working requirements are more stringent (hence the difference in position and wage). Due to these international specialists having the unique expertise and knowledge required for the implementation of complex projects, they are usually hired as managers. Specifically, the main responsibilities of these foreign experts, due to the experience they have gained by working for multinational mining corporations, include building up the technological process and ensuring the successful launch of new enterprises. Foreign specialists have a tremendous working experience, which they are ready to share with Kazakhstani employees. For companies operating in Kazakhstan, this experience is essential. Nevertheless, the company is highly invested in decreasing its dependence on labor from abroad. For the years to come, the human resources department sets its key task as creating a highly diverse, local talent pool . In order to attract local talent, various benefits are offered to Kazakhstani workers, especially to women in the workforce, who, according to KAZ Minerals’ human resources department, are hard to attract to mining careers.

KAZ Minerals also pays huge attention to the development of its employees—in 2015 alone employees received on average 49 hours of training (KAZ Minerals PLC 2015a). All employees, regardless of their occupation, undergo special training and education, enabling them to build rewarding careers. Specifically, in the first two weeks all newly hired workers receive mandatory industrial safety training (with a focus on electrical and fire safety, labor protection, physical fitness and professional development) required by the regulator in Kazakhstan (40 hours per year for supervisory staff and 10 hours for operational staff). Afterwards, depending on position, they undergo specialized training that differs in length and content for different groups of employees: managers and engineers are offered personal development programs aimed at advancing professional skills, whereas the operating staff receive additional training on accident prevention and occupational safety as well as physical training and professional development. All employees become closely acquainted with the technological processes and the requirements for their jobs, while continuing training on special simulators. Additionally, after each stage of training the company evaluates individual performance to determine the level of knowledge employees have gained during training.

According to the company’s official statement, KAZ Minerals’ training programs allow employees to reach their full potential and ensure they enjoy a motivated workforce that helps to achieve the corporate goals. When KAZ Minerals was first hiring new workers on its Bozshakol growth project it provided a special three-month training program on the company’s growth projects (KAZ Minerals PLC 2015b). Moreover, in the middle of 2015, the company introduced its mentoring program directed at the development of its operating staff (Kazminerals.info 2015). The purpose of the program is to provide newly hired employees with the essential knowledge necessary for them to develop practical skills and to facilitate their cultural adjustment. On June 20, 2016 there were 61 working mentors and 164 trained mentors in KAZ Minerals’ subsidiary in the Eastern region (Meyer 2016). The mentoring program, however, is not introduced in all of the company’s subsidiaries . Finally, KAZ Minerals sponsors its employees in developing their professional skills and qualifications, including sponsoring or subsidizing some of them through higher education (KAZ Minerals PLC 2016).

KAZ Minerals states that employees, like any other asset of an organization, require certain preventive and regular maintenance and in order to increase labor productivity, the human resources department set the following objectives (KAZ Minerals PLC 2015b): to improve the quality of human capital, to minimize staff turnover, and to adjust manufacturing business processes to current business needs. Meanwhile, in order to introduce fundamental qualitative changes in an asset of this sort, an organization has to make large investments in talent management, specifically in training and development . Due to Kazakhstani culture being more collectivistic compared to that of more developed countries, employees may react in an unpredictable way to Western-like talent retention practices . The power-distance scores are generally high with Kazakh people showing a strong respect for authority that could result in rather formal relations between employees and managers and potentially cause problems when establishing confidential communication in the company. In order to develop mutual trust in the organization and provide employees with a clear vision that they are all, regardless of position and occupation, part of a united company, company managers introduced a list of five KAZ Minerals’ corporate values, which serve as a basis for its corporate culture (Kazminerals.info 2016): professional development, long-term efficiency, safety, teamwork and honesty.

Following the devaluation of the tenge in 2015, KAZ Minerals sought to mitigate the impact of a weaker local currency on its employees and their families. In particular, free medical and dental services as well as leisure benefits are provided for all employees and at less than half price for their families and retirees (KAZ Minerals PLC 2017f). Workers have an opportunity to spend their vacations in health centers and their children have access to summer camps. In addition, all employees are provided with three hot meals a day. With regard to transportation issues, the company acquires a railway ticket for workers to transfer them to their final destination. The company base is equipped with a gym and rest rooms; a library and a hall for table games are in production. As in most Kazakhstani companies involved in copper mining and smelting activities, operating staff and managers are assessed based on health, production efficiency and cost control and ecological safety , thus incentivizing safety and productivity at the workplace. Bonuses for divisional heads are also linked to health and safety performance, as well as compliance with government-set environmental targets and the amount of environmental fines incurred. Moreover, in accordance with local regulations, KAZ Minerals is obliged to make payments to employees and former employees for illness and disability sustained in the company’s operations. The company contributes to defined contribution pension schemes in Kazakhstan, where this is a legal requirement.

KAZ Minerals has a rather complex yet relatively effective talent management system consisting of a variety of practices aimed mostly at developing qualified employees. The key challenges it encounters in order to develop and sustain its competitive advantages are mostly connected to the specifics of the industry it operates in. Therefore, the key, long-term, talent management objective is to ensure industrial safety and create a stable working environment , which means most talent decisions are aimed at reaching this goal. KAZ Minerals invests a considerable amount of its resources in developing certain skills of its workers, arranging a variety of safety programs and training on simulation machines, thus increasing their awareness of safety regulations to reduce future injuries and fatalities at the workplace and, as a result, create a positive image of company so that it can further attract talent.

Kazzinc: Orientation to the Future

Kazzinc, a subsidiary of Glencore International АG based in Ust-Kamenogorsk, is a leading, vertically integrated , polymetallic producer in Kazakhstan which accounts for a major share of zinc ore and zinc metal output along with considerable amount of copper, precious metals and lead. Most of the company’s core operations are in the East Kazakhstan region (Kazzinc 2017a). The company’s products are zinc metal, zinc-aluminum alloy, bismuth Bi1, lead bismuthate, gold, silver, copper in copper concentrate, copper blister, cadmium, indium, thallium, selenium, aluminum, mercury, antimony concentrate, zinc sulfate and sulfuric acid.

Kazzinc was established in 1997 through the merger of three majority state-owned Eastern Kazakhstan non-ferrous metal companies: Ust-Kamenogorsk Lead and Zinc Combinate, Leninogorsk Polymetallic Combinate and Zyryanovsk Lead Combinate, thus allowing it to pool the resources and systems of different independent economic entities to create а complete production cycle. Before the merger, these companies had not been able to maintain a cost-effective and balanced mine, concentrator and smelter operation due to lack of resources. With good financial support from Glencore, a world leader in the production and sale of metals, minerals and energy and agricultural products, Kazzinc consolidated the efforts of hundreds of teams and thousands of people and became a major company in the region (Uatkhanov 2016).

As of February 1, 1997 it has significantly increased production capacity and output becoming one of the world’s five, lowest-cost zinc producers (Kazzinc 2017a). In different years Kazzinc was certified for its quality management systems—recent certification was under the ISO 50001 Energy Management standard —that successfully continue to operate with annual recertification. Additionally, for the second time since its incorporation, Kazzinc was declared a leader of the year in the support and development of small and medium scale businesses in Kazakhstan. Specifically, in 2012 Kazzinc created a special department to develop local content under the memorandum of co-operation signed by different parties, including the East Kazakhstan Regional Administration, and since 2013, the company has signed 63 memorandums with domestic producers (Uatkhanov 2016). Two years later, the East Kazakhstan regional administration and Kazzinc signed a document on the acquisition of goods, works and services from regional companies for US$175 million. At the 2017 International Astana Mining and Metallurgy Congress it was awarded the eighth Golden Hephaestus Prize (Kazzinc 2017b), a national award for breakthrough innovative solutions, research and development in the mining and metallurgical industry established by the Ministry of Investments and Development of the Republic of Kazakhstan. The nomination was Leader of the Year for Local Content.

According to the company’s official statement (Kazzinc 2017c), the main long-term corporate objectives are as follows: (1) to minimize adverse health and environmental impacts by implementing best practices and introducing advanced technologies to mitigate the harmful effect on human health and prevent the occurrence of occupational injuries ; (2) to increase geological resources and reserves through targeted greenfield and brownfield exploration; (3) to improve production and management techniques by implementing effective ways to improve performance and reduce production costs; (4) to expand the business locally and regionally through the merger and acquisition of new assets by using their quality, size, location and fair value as the key performance indicators aimed at achieving maximum acquisition capitalization; and (5) to fulfill its corporate social responsibility commitments in all regions. Top management believes that incremental progress and prudent use of natural resources with a minimum risk to the environment would help create sustainable value for shareholders, employees, partners and the community.

Kazzinc determines seven corporate values (Kazzinc 2017c), all of which reflect on the specifics of the Kazakhstani labor market, industry specifics and corporate strategy (described above via key corporate objectives): people, unity, development, efficiency, stability, fairness, and zero tolerance for corruption. Firstly, employees are considered to be the company’s greatest asset and since mining is a hazardous industry, one would anticipate the safety, health and well-being of the people as being Kazzinc’s first priority in the workplace. Secondly, Kazzinc promotes mutual respect and trust, an ability to listen and understand, non-indifference to co-workers’ problems and dedication, since such features help people in achieving greater success at work by positively affecting knowledge transfer between different departments and creating stronger intra-organizational teams. As for efficiency and stability, the company strives to ensure production stability and efficiently maintains high-performance outcomes. A good indicator of success in this field is the fact that the company managed to survive the 2008–2009 financial crisis without losing its production and personnel. Finally, fair and transparent processes and solutions that are fully observant with the law are necessary elements of the management system. Attitude toward co-workers, proficiency and decency are appreciated to the same extent as high performance of employees, while any actions with a corruption element are strongly condemned.

According to official documentation, Kazzinc employs over 20,000 people across 500 different professions, of which more than a quarter has received higher education (Kazzinc 2017d). The organization clearly embraces a universalist definition of talent and focuses on all of its employees rather than a selective group of high performers and/or high potentials when conducting talent management practices. The following statement serves as proof: “Our people are the key for our success. Our teams consist of talented people with various experience, culture and knowledge” (Kazzinc 2017e). This is one of many examples where the company uses “talent” or “highly qualified personnel ” interchangeably with “employees” and “workers” in its official statements. In fact, the sincere belief that well-skilled, mobile and motivated human capital is Kazzinc’s key competitive advantage is one of the main reasons why senior management supports large investment in talent management practices. Specifically, continuous improvement and innovation are stipulated in the company’s development strategy and policy (Uatkhanov 2016)—training, career development opportunities and an open environment for ideas and creativity are offered to all employees (Kazzinc 2017d).

As for attracting talent, Kazzinc has graduate programs and pre-hiring special tracks with partner universities . Based on information provided to popular recruitment agencies, the company is interested in students from foreign technical universities , who are in their final- and penultimate year of education studying geology, metallurgy, mining , and mining electromechanics (Kazzinc 2017f). The overall recruitment process is more or less transparent, and understandably, the employment of local people is prioritized. When filling higher-level positions, Kazzinc mostly relies on internal talent.

The key factors negatively affecting the company’s ability to attract talent are low perception of workplace safety and environmental issues. Similar to other organizations operating in hazardous industries , Kazzinc continuously promotes the actions it takes in ensuring a safe and healthy working environment . In 2013, for instance, the company launched its comprehensive multi-phased project, SafeWork, aimed at preventing occupational injuries by changing the attitude of both its contracted and own personnel to safety aspects (Kazzinc 2017g). The project is based on long-term practices applied by similar operations in other countries that managed to establish the best occupational safety systems in the world. As for environmental protection, the company is highly concerned with energy saving issues, sulfur dioxide and solids emissions, arsenic and other wastes. It frequently reports on its efforts to neutralize the negative effects of its operations.

Corporate social responsibility is one of the key attracting factors of Kazzinc. The company plays an active role in the economic and social development of the towns and regions it operates in, contributing to education, health, sport and cultural projects. It facilitates infrastructure development and provides support to socially vulnerable groups (Uatkhanov 2016). In the East Kazakhstan region, specifically in Ridder and Zyryanovsk, Kazzinc has arranged shelters for children, provided assistance to orphanages and boarding schools, and implemented programs to assist orphans and disabled people. Together with the region’s administration it has helped over 100 children to find new homes, and provided others with housing and decent professions.

Finally, in order to become an internationally competitive company and gain access to the global talent pool , Kazzinc makes large investments in science (Uatkhanov 2016). It actively co-operates with external research centers and laboratories based in countries such as Finland, Germany, and Russia to gain knowledge about new technologies.

As for talent development, employee training including professional training , retraining and advanced training are arranged by Kazzinc on a regular basis to ensure the required qualification level of its workers. To feed its talent needs, the company annually invests over US$2 million in supporting training programs that are available to workers, leaders and managers of all levels and encompass environmental and occupational safety and health protection (Kazzinc 2017h). Moreover, for training and development purposes Kazzinc has established a corporate university comprising of nine departments: mining and geology, power engineering, mineral processing, metallurgy , automation and information technologies, personnel safety, environment, fixed assets maintenance, economics and management (Kazzinc 2017h). Any employee can upgrade his or her skills. In addition, the company has a distance learning system and several partnership agreements with leading higher education institutions in Kazakhstan and Russia, allowing, for instance, Kazzinc’s managers to obtain a Business Administration master’s degree. Nazarbayev University is one of these universities: senior specialists participate in the university’s consulting commissions in related focus areas (Kazzinc 2017h). Finally, Kazzinc also focuses its attention on training its personnel to identify hazards and risks in the workplace, as part of its SafeWork implementation (Kazzinc 2017g). To improve training efficiency the company has built a pilot training center complying with the highest international industry standards.

According to the company’s code of conduct (Kazzinc 2017e), convenient working conditions, a loyal team climate, opportunities for development, and just compensation are provided to all employees regardless of their race, nationality, religion, gender, age, sexual orientation, disability, ancestry, political or other opinion, or any other aspect. Kazzinc pays special attention to how young staff members are adapting and developing. It regularly assesses personnel competence and qualifications to identify talent, efficiency and potential, and provides relevant support and opportunities for their development.

As for talent motivation, the company has been developing its motivation system for nine years. Before the merger in 1997, each of the three metal companies—Ust-Kamenogorsk Lead and Zinc Combinate, Leninogorsk Polymetallic Combinate and Zyryanovsk Lead Combinate—employed different systems of formation of tariff rates and sаlаriеs, which forced the newly established company to develop a new system based on the legislative acts of the Republic of Kazakhstan regarding labor and wages. Kazzinc conducted an anonymous survey of approximately 1000 employees to determine the importance of different motivation factors (based on Herzberg’s theory of motivation in the workplace) and later, in 2005, the company launched Kazzinc’s “Pyramid of motivation” based on Maslow’s hiеrаrсhy of nееds (Kolomytsev and Kanapianova 2007). Taking into account the particular business culture in Kazakhstan, the most significant achievement was virtually removing the “wage deprivation” factor from the Pyramid. Now, only in the case of a safety rules violation, can an employee lose the vаriаblе раrt of his or her salary. The “Pyramid of motivation” consists of the following steps (Kolomytsev and Kanapianova 2007): (1) creation of appropriate working conditions; (2) remuneration (monthly and quarterly payments, bonuses, single саsh сomреnsаtion, performance assessment system); (3) a social package; (4) non-financial encouragement and bonuses, creation of achievements recognition; and (5) рossibilitiеs of sеlf-rеаlizаtion .

Kazzinc pays considerable attention to shaping the corporate culture and developing the creative potential of its employees and their families. The company organizes a number of different corporate activities throughout the year, including New Year celebrations and sports events and the “Club of Cheerful and Sharp-witted” (a competition where employees can show off their dancing, singing and acting skills). The event of the year, however, is “Mеtаllurgist Dаy”, an аll-сity holidаy with fеstivitiеs and реrformаnсеs by Kаzаkhstаni аnd forеign еntеrtаinmеnt stаrs. On this day, emрloyееs who сontributеd grеаtly to thе dеvеloрmеnt of thе сomраny аrе аwаrdеd with Сеrtifiсаtеs of Аррrесiаtion from Kаzzinс.

The talent management system at Kazzinc is well-developed, focusing more or less on all talent activities, including the attraction, development and retention of talent. Similar to other Kazakhstani organizations operating in hazardous industries , like KAZ Minerals, Kazzinc’s main concern is providing safe working conditions, considering that employee health and safety issues are among the most important problems in Kazakhstan. Consequently, the key objectives of the talent management system at Kazzinc revolve around creating a healthy working environment.

Together with generally less competitive wages and lack of career development opportunities, compared to foreign internationalized corporations from developed markets, the company has to consider unconventional motivation techniques (e.g. the “Pyramid of motivation”) that take into account people’s current needs to overcome the economic barriers and specific cultural issues that currently exist in Kazakhstan. The company’s efficiency is highly dependent on the level of motivation of its workers. In addition, there is the perennial problem of high power distance that exists in all of the post-Soviet countries, including Kazakhstan. In the context of a firm, this means employees and managers are at arm’s length from each other which leads to potential problems in communication and interaction. Specifically, feedback systems that are usually implemented by leading organizations in the West for employee development purposes stop working the way they should, becoming less effective and rather formal. Nonetheless, the company invests a lot of its resources to address these negative factors by creating equal rights for all employees, carrying out activities (unrelated to work) to reduce the power distance, and continuously improving its learning and development as well as motivation systems.

Tengizchevroil: Creating Talent Value

Tengizchevroil is the largest Kazakhstani organization that produces and markets crude oil, liquid petroleum gas, dry gas and sulfur, exporting its products to Europe, the Americas, China, Russia, the Mediterranean countries, Central Asia and international markets. The company was formed by the Republic of Kazakhstan and American Chevron Oil Corporation on April 6, 1993. Currently, Chevron holds a 50% interest in Tengizchevroil (Chevron 2017), whereas ExxonMobil, KazMunayGas and LukArco hold 25, 20 and 5% respectively (Tengizchevroil 2017a). The President of the Republic of Kazakhstan, Nursultan Nazarbayev, and Head of Chevron, Kenneth Derr, signed an agreement on the establishment of a Kazakh-American joint venture to develop Tengiz, the world’s deepest-producing supergiant oil field, in the Atyrau region of Kazakhstan (Tengizchevroil 2017b). Since then Tengizchevroil successfully launched a number of projects (Tengizchevroil 2017c), such as the implementation of a five-year social investment program (the Bonus Fund Atyrau Program) in 1993–1998. It also started Egilik social infrastructure projects in 1999 (including reconstruction of the central bridge over the Ural River in Atyrau as well as improvement of the oblast center), and the creation of Kazakhstan’s Maritime Academy in 2013. Additionally, it launched an integrated Future Growth Project-Wellhead Pressure Management Project (FGP-WPMP) designed to increase the total daily production from the Tengiz reservoir and maximize the ultimate recovery of resources (the FGP-WPMP Final Investment Decision was announced in 2016 ) (Chevron 2017). Since the start of this program, Tengizchevroil has provided a number of interest-free loans to entrepreneurs and small businesses, like MontazhSpetsStroy JSC, a fully state-owned and -operated engineering, procurement and construction Kazakhstani company to upgrade their health, environment and safety practices to meet international standards (Chevron 2017). Now, according to the official annual and quarterly reviews, Tengizchevroil demonstrates excellent performance results in various areas, including crude production, sales, safety and environment, community outreach (supported projects planned to help improve the quality of health and education in the Atyrau region through the community investment program), workforce development, and so on.

Tengizchevroil’s mission is to create superior value to all stakeholders, including the Republic of Kazakhstan, its employees, communities , business partners, customers and others, by becoming the safest, most efficient and profitable oil and gas enterprise in the world. Therefore, the company’s strategy focuses on four key aspects (Tengizchevroil 2017d): differentiating performance via technology and functional excellence; developing reserves to grow profits and returns; delivering superior results through effective and efficient execution; and investing in people. In addition, as one of the most important objectives for Tengizchevroil is ensuring safety of its personnel and protecting the environment by preventing high-consequence events, the company has employed the Operational Excellence Management System (OEMC) as a part of its risk management program. OEMS consists of three parts (Tengizchevroil 2017d). The first is leadership accountability as leaders play an important role in helping the company achieve superior results. The second is the management system process. The third consists of operational excellence elements and expectations united into 13 elements (security of personnel and assets, facilities design and construction, safe operations, management of change, reliability and efficiency , third-party services, environmental stewardship, product stewardship, incident investigation, community and stakeholder engagement , emergency management, compliance assurance, and legislative and regulatory advocacy).

As for its corporate values, Tengizchevroil states that it conducts its business in a socially and environmentally responsible manner, taking very seriously corporate social responsibility, performing to the highest ethical standard , respecting the law and benefiting the local communities . These values are diversity and inclusion (i.e. celebrating the uniqueness of cultures and values of individual talents, experiences and ideas), high performance (i.e. striving for efficiency and continual improvement), integrity and trust, partnership (i.e. building productive and collaborative relationships with all stakeholders), and protecting people and the environment (Tengizchevroil 2017d). The last, as already mentioned above, is one of the most important objectives for the company.

In official reports and publications Tengizchevroil stresses that the company’s major asset is its employees (Tengizchevroil 2013), who make the company’s greatest achievements happen due to their high level of expertise, professionalism and dedication (Tengizchevroil 2016). Like Kazzinc, Tengizchevroil has a selective but inclusive definition of talent , meaning only those who possess the right attributes and skills or have high potential and promise are hired, while those who are already employed by the company have access to all relevant career and development opportunities offered by the talent management system.

The workforce includes people of various ages, experiences and qualifications who are being hired through both internal and external methods of recruitment. However, considering Kazakhstan’s labor market, there is high demand for young talented professionals who are one of the least active job hunting groups. At the same time Tengizchevroil, as a growing company (and according to the trends in Kazakhstan recruitment), is interested in graduates and offers a wide range of career starting positions for them. Both young and more experienced employees are being approached through different external and internal recruiting channels. For external recruitment, several channels can be identified (Tengizchevroil 2017f): internet job boards (the company’s job board on its official website) and job fairs, and major employment and networking events for hiring outstanding graduates for the company’s engineering and analytical positions at the Atyrau and Tengiz locations. Job fairs take place at the premises of universities : they last several days and consist of aptitude tests and preliminary interviews. These career fairs help to attract young prominent professionals despite their general inactivity in searching for jobs.

Internal recruitment becomes possible due to the range of training and development programs held by the company that were brought to Kazakhstan by international companies. Western practices are implemented by the major owner of Tengizchevroil, Chevron, that facilitates effective training in the company which is generally not common among Kazakhstani employers. As a result of these intensive development programs, many talented employees are promoted to job positions with higher levels of responsibility. This, in its turn, substantially decreases the need for external recruitment. For instance, the most recent Tengizchevroil’s report stated that due to these training projects 113 Kazakhstani specialists replaced foreign employees “in key managerial, supervisory and technical positions” during 2010–2014 (Tengizchevroil 2014). This shows that implementing training programs in Kazakhstani companies facilitates employment and further promotion of employees.

In addition, there is a trend to offer workplaces and career opportunities to Kazakhstani people first (and then to people from other regions) to support local communities . Most probably this stems from the significant shift in human resource management at a country scale from attracting foreigners with international experience to instead hiring local labor. The company is also known for its engagement in raising women’s competitiveness on the job market including requalification and education of unemployed women in Astana and Almaty. This policy can be explained by Kazakhstan striving for and succeeding in gender equality.

As for long-term talent attraction practices, Tengizchevroil actively engages in corporate social responsibility. From 1993 to the first half of 2016, direct financial payments from the company to the Republic of Kazakhstan amounted to US$114 billion. These related to the salaries of Kazakh employees, the purchase of goods and services from domestic producers and suppliers, payments to state enterprises, and dividend payments (in the form of taxes and royalties as well), all transferred to the state budget (Tengrinews 2014). In addition, Tengizshevroil annually participates in and supports performances devoted to HIV/AIDS prevention at schools and colleges. The company has donated money to the water replacement and gasification projects in Kulsary and invested in the reconstruction of schools and kindergartens in the Aturay region. It has also renovated three parks during 2014–2015 and planted over 3000 trees.

Finally, similar to KAZ Minerals and Kazzinc, complying with all the safety requirements in the workplace is one of the company’s priorities (achieved by means of a project called the Behavior Based Safety Program, implemented to create an injury-free work environment). Tengizchevroil strives to achieve industry-leading safety results in standard industrial safety measurements such as Days Away From Work and Total Recordable Incidents (Tengizchevroil 2017e). Achieving zero workplace injuries and fatalities is something potential employees, including talented workers, consider when searching and applying for an open position in such an unsafe industry, making industrial safety an important attracting factor. For instance, in 2016, Tengizchevroil employees and contractors worked 55 million hours without a single “Days Away From Work” incident, which was a personal record for the company. Thus, the politics of maintaining safety in the workplace creates a competitive advantage for Tengizchevroil as an employer, since safety issues are considered to be one of the main weaknesses of Kazakhstani companies in general.

To meet modern challenges, Tengizchevroil has put in place a strong experience-building training and workforce development plan that includes technical, computer, managerial, interpersonal, organizational and language training (spending about US$46 million over the past 10 years) (Tengizchevroil 2017g). Major activities in the field of talent development include the Leadership Program and a Temporary International Assignment Program (Tengizchevroil 2014). The latter contributes to broadening personnel’s knowledge through cross-functional, domestic and foreign work assignments. Presumably, these measures help to combine the need for an international working experience for employees and the hiring of local (i.e. Kazakhstani) people. In addition, different training and mentoring projects are implemented in order to improve the skills of technical staff. Tengizchevroil’s expatriate workforce is below 13% (Tengizchevroil 2014), as Kazakhstani citizens hold the overwhelming majority of the company’s positions. Kazakhstani managers and supervisors hold three-quarters of the firm’s supervisor and manager positions (e.g. general manager of strategic planning, tax manager, plant superintendent, treasury manager, supply chain group category manager, comptroller and environmental supervisor). Moreover, Tengizchevroil financially supports and encourages its most prominent employees to acquire Master- and MBA-level degrees. The company annually sends over 200 people to foreign locations for training in their specific fields and provides international developmental work assignments for some talented workers. Along with all these educational programs, the company participates in joint ventures with foreign and local oil and gas suppliers, thus contributing to knowledge transfer and the acquaintance of local talent with the best practices in the industry (Tengizchevroil 2014).

There is a variety of opportunities for each talented worker to be fulfilled. First of all, Tengizchevroil has a policy of employees’ career growth assistance. All of the educational programs that exist in the company are aimed at preparing a talented employee to take a higher job position with more responsibility. At the same time, new incentives are always encouraged by Tengizchevroil in order to make the company a better place to work in. In addition, every employee (talent and non-talent) can participate in the development of Tengizchevroil’s social life by offering new ideas in the fields of entertainment, professional growth, sports activities and work and family balance.

Tengizchevroil pays great attention to talent retention and motivation. It offers one of the best employee benefits packages in Kazakhstan, covering housing, savings, support for employees’ families and health benefits, including medical insurance for personnel and their families, special accommodation and recreation arrangements, interest-free mortgage loans and employees savings programs, sports programs, and so on. Tengizchevroil relies heavily on both monetary incentives and non-financial motivation, the combination of which facilitates the successful conversion of purely corporate goals to the personal goals of each and every employee, regardless of talent status. This is particularly relevant considering the strong migration patterns in Kazakhstan, which is why the company continuously develops its motivation system to ensure its employees will not leave the organization (and the country for that matter).

Tengizchevroil employees value their jobs for stability, competitive salaries and various opportunities for career growth through professional developmen t within the company, which is crucial due to the recent market changes that left some Kazakhstani people without their pay and even their jobs. Therefore, a strong and effective benefits system is needed to reduce employee turnover in general and, as a result, retain the most talented. Tengizchevroil, indeed, pays attention to all these aspects, striving to become a desired employer for current and potential high performers. For instance, the company has a performance-based remuneration system, according to which salaries are paid based on merit. Employees are also awarded with letters of recognition during official ceremonies for their high quality of work, outstanding results and contribution to the progress of Tengizchevroil. However, as mentioned earlier, Kazakhstan is a country where appraisal systems are far from being effective due to specific socio-cultural factors. Moreover, in reality, compensation usually correlates weakly with actual performance in the Kazakhstani context, which indicates there is an opportunity for the company to develop a more meaningful and motivational reward and performance appraisal system.

Tengizchevroil strives to become a desirable employer, putting a lot of effort into attracting talented workers, developing them and creating a better working environment. However, the company faces a range of difficulties, the majority of which are connected to the environment the company operates in, that is Kazakhstan. Since the company’s talent management objective is strongly connected to the corporate vision of becoming “the safest, most efficient and profitable oil and gas enterprise in the world” (Tengizchevroil 2017d), the main areas of concern are the rewards system, adaption of best management practices and cross-cultural management (considering foreign governance and the presence of different ethnic groups in Kazakhstan), industrial safety and talent recruitment. In particular, the reward system in Tengizchevroil that promotes high-quality performance does not seem to work successfully for all employees due to the general level of development of appraisal systems in Kazakhstan (as already witnessed in the KAZ Minerals and Kazzinc cases). Specifically, some workers organized a number of strikes, refusing to come to work unless their wages were increased (Tojken 2012). Such a situation is also a sign of drawbacks in internal communication as problems occurring within the organization are not solved promptly or are even ignored by managers, leading to public protests that negatively affect the company’s reputation. Within this context, Tengizchevroil needs to take certain measures in order to lessen the power distance between employees and their supervisors and managers.

Tengizchevroil puts a lot of effort into increasing the share of the local population in its employee ranks; however, due to the country’s ethnic diversity, it has to deal with conflicts that occur between workers of different cultural and/or ethnic backgrounds (Tumanov 2006). The main reason behind these conflicts is the general disagreement about what the “right” norms of behavior are in a workplace. Finally, similar to most Kazakhstani companies, Tengizchevroil has to regularly deal with clanism (common in this area) that can lead to biased recruitment and promotion (Minbaeva and Maral Muratbekova-Touron 2013).

Conclusion

Most of Kazakhstan’s distinct talent management practices reflect its distinct cultural make-up and the country’s historical legacy of the Soviet way of managing employees. However, the Western tradition is slowly seeping into Kazakhstan, resulting in a “hybrid ” form of practices that shares the characteristics of both Western and local ways of thinking. This indicates that despite the dynamic economic growth of Kazakhstan, talent management is still in transition from Soviet era practices to ones current in foreign companies. The understanding of human resource management practices in Kazakhstani firms varies from administrative functions to using human resources strategically for a company’s growth (i.e. focusing on talent management). Due the strong impact of its Soviet heritage on the different aspects of management and behavior of people, as well as certain cultural, economic and social factors in Kazakhstan and other CIS countries, there is generally a low variety of talent management practices. Specifically, as a highly formalized Soviet society which is perceived as a culture with a higher power distance between managers and subordinates and where social orientation prevails over task orientation, Kazakhstani companies employ talent management practices that show a high rate of formalization in recruiting and training policies. Talent management is developing due to the adoption of various talent management practices from Western companies, thus helping local companies become more competitive, boosting the development of the country’s economic sectors (other than natural resources extraction and financial), and increasing Kazakhstan’s attractiveness to foreign investors for further prosperity.

Compared to other CIS countries, such as Ukraine and Belarus, Kazakhstan has a rather mature and developed talent management system, which could be due to the fact that Kazakhstani organizations have been transforming their human resource management departments from post-Soviet toward the universalist approach at a quieter pace, allowing for sustainable organizational restructuring. It is worth noting, though, that in two of the reviewed cases—Tengizchevroil and Kazzinc—foreign companies from developed markets (specifically, from the United States and Switzerland) held a 50% or more interest, which could directly influence these companies’ business operations. In particular, local companies most likely have direct access to valuable external knowledge (including access to larger talent pools with highly professional foreign experts); they receive more financial support which gives them additional freedom to implement unconventional managerial practices to achieve their corporate goals. So one can assume that in the case of Kazakhstan, ownership structures and countries of origin played an important role in the development of corporate talent management systems, talent attraction, development and retention practices. However, future research is required on the topic.