Talent management implies recognizing person’s inherent skills, traits, personality and offering him a matching job. While there are no magic formulas to manage talent, the trick is to locate it and encourage it. Talent management is beneficial to both the organisation and the employee.
Talent management is a conscious, deliberate approach undertaken to attract, develop and retain people with the aptitude and abilities to meet current and future organisational needs.
Learn about: 1. Introduction to Talent Management 2. Meaning and Concept of Talent Management 3. Features 4. Competency Framework 5. Process 6. Areas 7. Key Drivers 8. Models 9. Best Practices.
Talent Management: Meaning, Features, Process, Areas, Key Drivers, Models and Competency Framework
Contents:
- Introduction to Talent Management
- Meaning and Concept of Talent Management
- Features of Talent Management
- Competency Framework for Talent Management
- Process of Talent Management
- Areas of Talent Management
- Key Drivers of Talent Management
- Models of Talent Management
- Best Practices in Talent Management
Talent Management – Introduction
Talent management is a term emerged in the 1990s to incorporate developments in HRM which placed more emphasis on the management of human resources or talent. It goes hand in hand with succession planning, which ensures that employees are recruited and developed to fill each key role within the company. However, most companies do not plan ahead for the talent they need by which they face shortage of critical skills at some times and surpluses at other times.
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It is expensive to develop all talent internally; rather than developing everyone internally, companies can hire from outside. Thus, the solution is to either make or buy; that is to train some people and to hire the experienced skills from the external market. “Making” an employee means hiring a person who doesn’t have all the needed skills but who can be trained to develop them. The “buy” decision means hiring an employee required to perform a job who has necessary skills and experience.
Major aspects of talent management include: performance management, leadership development, workforce planning and recruiting. Besides, make or buy decision, another important principle that works well in talent management is to run smaller batch size. Thus, rather than sending employees for long training programs, they can be sent to short programs more frequently. With this approach managers don’t have to make training decision far in advance, thus ensuring that employees are trained on the skills they’ll actually use.
The most important aspect in talent management is attracting right workers—the one who feel enthusiastic about their work and whose goals and aspirations match with those of the company. Thus, the organizations need to be very clear about the kind of talent it wants to capture.
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Talent Management:
Talent management may be viewed as a consciously worked-out process of recruiting, developing, managing and remunerating high performing employees in the organisation. It lays major emphasis on the acquisition, development and retention of talents needed for meeting organisation’s requirements.
The need for talent management has emerged mainly as a result of fierce competition in the global markets, which necessitates quick and prompt decisions as well as urgent and effective actions. A number of reputed business organisations have started maintaining a pool of employees, managers and executives with diverse background, and utilise their services as and when needed.
Improvement of information technology, Internet and a variety of software devices has facilitated increasing adoption of talent management programme in organisations having globalised businesses. Important ingredients of the system include e-recruiting, e-learning, performance reviews and lucrative compensation packages and facilities. It also involves the use of strategic goal-setting and succession planning.
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Some specific measures contemplated in talent management include the following – (i) adopting appropriate training and development programme, (ii) provision of rotational and foreign assignments for high performing employees, (iii) providing adequate opportunity for promotion, (iv) providing facilities for intensive coaching and mentoring, (v) offering lucrative compensation packages for improved performance, (vi) encouraging team-work and (vii) temporary placement on higher jobs.
Formulation, as well as implementation, of talent management programme is the responsibility of both line and HR managers. While formulating the programme, it is necessary for the management to give due attention to the following – (i) the needs and strategic goals of the organisation, (ii) conditions of the labour market and availability position of potential candidates and (iii) skill-requirements of the jobs to be filled.
Talent Management – Meaning and Concept
In an organisation, there is nothing more crucial than fitting the right employee in the right position. When people do jobs that just don’t suit their liking, inclination or temperament, the results, or rather the lack of them, will be disastrously obvious. Low productivity, dissatisfaction, low morale, absenteeism and other negative behaviour will become typical till the employee is terminated. Or perhaps, there is another option – Talent Management.
In the competitive scenario to attain competitive advantage in every aspect what we need is how different we are from our competitors and what are our core competencies. In our knowledge based economy, value is the product of knowledge and information. In the present day context, companies cannot generate profits without ideas, skills and talent of knowledge workers and companies have to bet on people, not on technologies and certainly not on capital.
To survive in the knowledge based economy over the long run, organisations must become focused and be capable of managing employees as their most critical resources. Hence, workers now require more education and skills than ever before, as positions have become more knowledge based and information intensive. With the business going global and because of cut throat competition, there is a need to develop and deploy people who can articulate the passion and vision of the organisation and make teams with the energy to perform at much higher levels. Hence, talent plays a vital role.
Talent management is the process of creating a high-quality, highly engaged workforce by hiring, retaining, deploying, and engaging talent at all cadres and it has been the source of generating inimitable competitive advantage for the organisation.
In the modern context of global economy where competition is cut-throat, new designs are always copied, pricing strategies are always countered, niche markets become overcrowded sooner, the only way that guide the organisation to remain creative and innovative is managing talent as a critical resource to achieve the best possible results.
Not many organisations have an adequate supply of talent because of gaps at all cadres in the organisational hierarchy. Since the talent is a scarce resource, it must be managed effectively and efficiently. In other words, train the employees to be able to do more with less, grow them in to leaders with strategic emphasis and then develop on their successors.
It is the responsibility of the top management to ensure that there is right quantity and quality of people within an organisation to meet their current and future business priorities. All the stages of selection, training and development, succession and performance management are equally critical.
Talent Management – 6 Important Features: Recognise Talent, Attracting Talent, Selecting Talent, Retaining Talent, Managing Succession and Change Organisation Culture
Talent management is nothing but identifying, realising and guiding untapped potential in people. It means nurturing and developing the people identified having ability and potential and it should form part of any organisations recruitment and retention strategy. It involves individual and organisational development in response to changing and complex operational environment. It includes the creation and maintenance of supportive and people oriented organisation culture.
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Talent management is a conscious, deliberate approach undertaken to attract, develop and retain people with the aptitude and abilities to meet current and future organisational needs. Every person has a unique talent that suits a particular job profile any other position will cause him discomfort. A wrong fit will result in further hiring, retraining and other wasteful activities. In order to bring harmony in such situations, the key ingredient is “putting the right people in the right jobs”.
Talent management brings together a number of important human resources and management initiatives. Organisations that formally decide to manage their talents undertake a strategic analysis of their current HR process.
Talent management approach is adopted and focussed on co-coordinating and integrating the following:
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i. Recruitment – ensuring right people are attracted to the organisation.
ii. Retention – developing and implementing practices that reward and support employees.
iii. Employee development – ensuring continuous formal and informal learning and development.
An important step to be taken in an organisation is identifying the staff or employees that are critical to the Organisation. Many organisations lost a lot of their knowledge pool in the downsizing exercise a few years ago. The impact of the loss was not immediately apparent.
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However it did not take long for many companies to realise their mistake. What is more important is to think of whether people are still seen as an organisation’s most valuable assets. Business leader are quick to say that but when it comes to the real situation, they are not realizing the same consequently they are worried about retaining them.
For those companies who have the foresight to take more innovative and imaginative approaches, they will have the opportunity to gain competitive advantage by creating niche for human resources. For those who don’t, their future competitiveness will remain even more uncertain.
The distinct features which are needed for talent management:
Feature # 1. Recognise Talent:
Notice what do employees do in their free time and find out their interests. Try to discover their strengths and interests. Also, encourage them to discover their own latent talents. For instance, if an employee in the operations department convincingly explains why he thinks he’s right even when he’s wrong, consider moving him to sales!
Feature # 2. Attracting Talent:
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Attracting qualified talent is the critical first step in the talent management cycle. The improving economy, baby boomers, retirement and other factors are creating keen competition for talent these days. Hence this step has become more critical them ever before.
Companies have to attract good talent by establishing their brand identity. As we know that we get good customers with a good brand. In the same way, companies must develop their image in the society by implementing the best practices in each and every aspect.
Feature # 3. Selecting Talent:
Once quality people are attracted then it is very important to choose right candidates for the right job. What companies have to do is to match the job analysis with human analysis which gives the real picture of role fitment. This process must be adopted by every company in order have high performance teams which give competitive advantage.
“Any strategy, no matter how smart, is dead on arrival unless companies bring it to life with people.”
Feature # 4. Retaining Talent:
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Most companies today would acknowledge that their human assets are their most important assets. But since companies can’t own employees the way they own factories or product, their success or failure hinges on the quality and duration of the relationship they form with the people.
In present scenario people choose companies which have congenial atmosphere and prefer change if they don’t get desirable atmosphere. As it may hinder the growth and successes of the company, therefore, retention is vital than recruitment. Rewards for high performance, employee welfare, opportunity for individual development, employing personal and professional counseling initiatives, enhancing QWL are some of the technique that help in retention of employees.
In order to retain talented people, pamper the talent pool and aspire them with recognition, status and good money and also encourage them in the quest for knowledge. They have to be provided assistance with financial planning, entrepreneurship development programmes and sometimes part time employment options also. If these things are not provided, people will find companies where all these things are available and quit the present organisation.
Feature # 5. Managing Succession:
Effective organisations anticipate the leadership and talent requirement to succeed in the future. Leaders understand that it’s critical to strengthen their talent pool through succession planning, professional development, job rotation and workforce planning. They need to identify potential talent and groom it.
Feature # 6. Change Organisation Culture:
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Ask yourself, “Why would a talented person choose to work here?” If the organisation wishes to substantially strengthen its talent pool, it should be prepared to change things as fundamental as the business strategy, the organisation structure, the culture and even the calibre of leaders in the organisation.
A rightly managed talent turns out to be a Gold Mine. It’s inexhaustible and priceless. It will keep supplying wealth and value to the organisation.
In turn, Management needs to realise its worth, extract it, polish it and utilise it. Don’t hoard Talent- spend it lavishly, like a millionaire flashing his luxuries, because Talent is Wealth!
Talent Management – Competency Framework
We are familiar with the maxim, ‘what gets measured gets monitored and done’. Similarly, we must identify organizational needs, meet, and fulfill those needs in order to develop the organization. An organization strives to achieve the business goals for the purpose of which it must identify the competencies and develop competency framework.
The most important aspects of talent management are talent acquisition and talent retention. Talent management emphasizes that an organization must identify the competencies necessary for success of the business. Talent management focused on HRM.
However, from the standpoint of competency framework for talent management, the essential tasks are as follows:
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1. Ensuring that your people demonstrate sufficient expertise
2. Recruiting and selecting new staff more effectively through structured processes
3. Evaluating performance periodically
4. Identifying skill and competency gaps more methodically
5. Providing more customized training and professional development
6. Planning sufficient scope for succession
7. Making change management processes work more efficiently.
Talent Management – Process (With the Prerequisites for Talent Management)
The process of talent management covers:
1. Establishing an optimal long-term strategy for attracting, developing, connecting and deploying the workforce.
2. Sourcing and recruiting or holding onto the appropriate skills and capabilities, according to business needs.
3. Motivating and developing the talented personnel to match business requirements for higher levels of job satisfaction.
4. Deploying and managing to match skills and experience with organisational needs.
5. Connecting, enabling, and collaborating for sharing knowledge, and working effectively in virtual settings.
6. Achieving clear, measurable and sustainable transformation within the organisation, while maintaining the day-to-day continuity of operations.
Generally, talent management as a process includes all the processes involved in HRM functions such as – recruitment, performance management, competency management, succession management, career development, learning, compensation and grievance handling.
Talent management requires an organisational commitment to attract, acquire, manage, and measure the talent needed to achieve a company’s business objective. The business and talent management systems need to be aligned with processes to maximise the associated benefits.
The prerequisites for talent management include:
i. How the business goals are aligned with the aspirations of the workforce;
ii. The talent required to achieve these goals and aspirations;
iii. The applications and processes to drive down the goals through the organization;
iv. An understanding of the opportunity costs to be incurred if the talent management strategy is not executed;
v. How to move to next stage of the talent management.
Talent Management – 9 Areas Identified by the Institute for Corporate Productivity
The institute for Corporate Productivity (i4CP) identified nine areas of talent management:
a. Leadership Development
b. Succession Planning
c. Career Planning
d. Performance Management
e. High Potential Employee Development
f. Learning and Training
g. Competency Management
h. Retention
i. Professional Development
Can these areas of talent management be generalized for all firms? Are these nine areas the total gamut of talent management? The answer to both these questions is ‘no’. More and more research has shown that talent management for most firms is a matter of priority.
Neither this is an exhaustive list of various areas of talent management nor do these areas equally apply to every firm. For instance, for many firms’ identification and acquisition of talent remains an issue of grave concern.
The i4CP research also showed that most companies concentrate on at least two areas of talent management:
a. Competencies
b. Performance processes i.e. how to leverage those ‘competencies’ by putting them in the right parts of the organization and then right parts of the organization and then measuring their impact on real goals.
A survey by the ‘New Talent Management Network of People’ with talent management responsibilities of 80 small and large US companies brought forth three primary areas of talent management succession planning (94%), development and career planning (88%) and assessment and feedback (82%).
Talent Management is more about priorities that a firm faces in terms of its talent requirements to realize its strategic objectives.
Talent Management – 14 Key Drivers of Talent Management
1. Technological change in the light of Fourth Industrial Revolution transforming economies as never before.
2. Radical changes unleashed by new digital, robotic and 3D technologies for improving efficiency and higher productivity through automation.
3. Higher rates of growth, productivity and employment, need for superior organisational performance.
4. Increasing focus about quantifying the Return on Investment (Rol) in talent management.
5. Higher expectations of stock market return and higher safety. The companies that invest in talent management in terms of best leadership practices, employee engagement, knowledge accountability, workforce organisation, and learning capacity contribute to these predominantly cherished business goals.
6. Talent management is the source of value creation. The financial value of many companies today is often determined by the quality of talent.
7. Business complexity and dynamic or hyper-market conditions.
8. Talent management is increasingly realised as a sure path for sustainability in terms of new products, new business models, products with shorter life cycles and constant innovation.
9. Higher rate of technology obsolescence.
10. Economic downturns and recession.
11. Need to move at the speed of business.
12. Need for higher levels of employee engagement and performance.
13. Ever increasing demand for challenging and meaningful work, modern organisational structures, and authority and work-life balance.
14. Continuous changes in the workforce demographics – retirement age is getting extended, ambitious youngsters to reach top early, faster rate of learning, etc.
Talent Management – Models
Talent triggers performance. Talent management models vary from organisation to organisation. More often the nature of the organisation decides the model. Here are a few models of talent management that focus on different processes but ultimately creating a high impact on performance.
Smart phones, mobile apps, emails, messages, and communication technologies (through text, sound, and video) have- revolutionised the sources of honing the talents and this -has an impact on both the work environment and the personal life of the employee. Work culture has improved and so have the productivity and work experience. Talent is not any more confined to what one learns and applies to the work context, but today it means what type of experience one can deliver to the customer.
The work practices, compensation strategies, performance management systems and practices of HPOs are not anymore confidential issues; everyone knows how these are handled. Technologies are available everywhere and hence the life has become more transparent.
The reviews and ratings are the real triggers for higher volumes and brand equity. Today the world is wide open for feedback and the barriers among the employees, managers and other stakeholders are fading away.
The real talent today is the decision making through analytics and predictive models and the world of talent is changing from the conventional model (of recruiting, attracting, managing, rewarding the workforce and learning, curating and managing work-life experience) to modern talent management systems which tend to be more accurate.
Technology enabled talents are now on the hunt and those who master people analytics are on high demand. People analytics models can accurately predict, for instance, who is likely to leave, hint about we should do to attract great people, and suggest how will take to build great leaders.
1. Traditional Models of Talent Management:
The traditional model of talent management focused on the HR functions such as – manpower planning, recruitment and selection, learning, performance management, compensation management, talent analytics and talent management platforms. These were viewed more in silos and integrated or holistic perspective was missing.
Further, considering the volatile, uncertain, complex and ambiguous business environment, the traditional models were not dynamic and accurate in terms of delivering business results.
2. New Model of Talent Management:
New model of talent management creates e-talent management platforms. In other words, the modern talent management model is an integrated and technology enabled process that seamlessly covers all the issues in talent management end-to-end.
Today, there are many Enterprise Resource Planning (ERP) providers offering these tools integrated with a core HRM, payroll, and a wide range of other incorporated technologies. These have augmented the number of talent management platforms and thus market for talent management products and services has been larger than before.
Today, there are modern tools available that offer new, innovative or even disruptive integrated solutions for talent management ranging from recruitment, learning, and wellness to performance management and employee feedback systems.
These are called next-generation performance management tools because they offer all-in-one integrated recruitment platform in terms of integrating smart sourcing, candidate relationship management, interview management, applicant tracking, and smart analytics, onboarding and employee communications and Learning Management System (LMS) platforms.
The self-learning systems have started replacing the instructor-delivered systems and as a result the employees have an absolute control over the learning process and systems. They can choose, based on their requirement, the video content, Massive Open Online Courses (MOOCs), and access the whole content available through search engines.
MOOC refers to an open, low-cost (in some cases, it is offered free also) online education and courseware. It is popular today among the students and also the corporate executives who are curious to learn something beyond their academic curriculum and based on their personal interests.
The corporate recognise the MOOC certifications for considering their employees for promotions and other distinctions and are investing heavily to build industrial-strength learning platforms and expand their content. Learning and Development (L&D) becomes an integral part of talent management and today we have learning experience designers amidst us and they do not teach, but design the learning experiences.
The learning systems are designed around online video, MOOCs, external content, and expert-authored material and all these are targeted to significantly enhance the employee experience and the employee talents to deliver a new group of solutions. Also, it has a system to measure feedback, engagement, and employee sentiment.
The feedback is measured through pulse surveys, open text comments, and structured interviews and anonymous conversations. Pulse Survey Tools are used to know people’s feelings, opinions, and feedback, supplemented by the annual engagement survey. Feedback Apps facilitate to analyse, filter, up-vote, down-vote, and evaluate for sentiment at any time.
Performance Feedback Systems provide team or manager-level feedback on a regular basis. The collaboration software and social recognition tools can be used productively to appreciate or thank the employees, or give positive feedback to others in an open and social way. This feedback is constructively designed to engage, manage, and understand our workforce.
The work ethos has changed in the sense that employees demand flexibility; look for autonomy at work besides empowerment. “How to engage the employee?” has become the major concern for every business leader. The good leadership today is reflected by the way the results are delivered; issues relating to succession planning are handled.
The employee engagement is more project or assignment based. Team leadership, virtual and network organisation structures have become the order of the day. Outsourcing is being considered as a predominant source of delivering value and employees are becoming more contingent than ever before. All these issues have an impact on talent management systems.
The new model of talent management takes the organisations step-by-step as outlined here:
i. Silo approach to talent management (here talent management is isolated or sporadic, the talent management strategy will not be in place, talent management is confined to bare minimum and essential activities such as – performance management, talent acquisition).
ii. Systematic approach to talent management (this comprises systemic talent relationships and is effective at implementing essential talent activities).
iii. Effective growth of talented workforce (with strong learning culture, beyond compliances and diversity and inclusion-based activities).
iv. Fully integrated talent activities aligned to desired strategic outcomes (here the talent relationships are systematic and tailored as per the needs; the focus is on employee experience).
Every stage has a strategic implication. There could be significant difference in the performance and the cash flows from step-to-step. For instance, organisations who reach the step 4 enjoy far superior cash flow over a five-year time frame because they are fully geared up to respond to business change, to innovate, to develop their employees and develop its leaders. In other words, companies in step 4 show high endurance in terms of high performance that drives long-term value for their shareholders. So, it is essential that organisations should move from stage 1 to stage 4.
Talent Management – Best Practices in Talent Management
1. Aligning the talent strategy with the business strategy. Here the key essence is to integrate the business goals and strategies that drive the quality and quantity of the desired talent.
2. Every member in the cadre owns talent management process as a partner, guide, and trusted advisor. The members of the senior management team in particular will get involved in recruiting top talent, grooming high-potentials, and reviewing talent pools.
HR owns and ensures that professional talent management processes are in place and then move closer to business requirements. The business plans are developed in consultation with the line managers and the talent plans are integrated accordingly.
3. The competencies are used as the basis for succession management, external hiring, and inside promotions. Models are developed exclusively to handle competencies across the organisation aligning them with overall business strategies.
4. Every member in each cadre contributes to value creation. The organisations develop capabilities to compete considering the performance of all its key talent, and its ability to develop and promote that talent.
5. Organisations emerge successful because of their investments in the best. They invest heavily on the promising individuals. They never spread limited resources for development equally across all the employees. Extra development increases their success in these pivotal roles.
6. Potential, performance and readiness are recognised to be different from each other. Only those who have potential will be capable to perform and get ready to deliver. Identify the talent and nurture it as required. Talent management is all about putting the right people in the right jobs.
7. The talent management initiative is linked to the business drivers, a vision is put forward across the organisation, and the expectations are set for what will happen in the organisation.
8. The role clarity is created so that each individual in the talent management initiative knows what is expected of them. This fixes the accountability on each member in the whole process.
9. Even the executive coaching and mentoring skills for support are updated from time-to-time.
10. Talent management initiatives are closely aligned to the business drivers. Right kinds of systems are developed to identify high potentials, to diagnose for development, to link to performance management, and to do development that really changes behavior.
11. The impact of talent management programmes is evaluated by focusing on what’s working in talent management, why those initiatives are effective, and what impact they have on the organisation. Just number of effective cases or ineffective cases does not really give the necessary insights for further analysis and initiating remedial measures.
12. The full talent management system is never mistaken for a software package. Software is only a tool valuable in support of a good plan and it helps to clear the path for smoother execution and may improve the end product. Right expertise with access to right tools is focused for effective results.