Overview



This is the first in an occasional series of articles taking a general look at the strategic issues facing HR today. In this article I will be looking at Talent Management.



Talent Management



In the days when people would work for the same company for their entire working lives the only strategic HR planning consisted of Succession Planning. Talent Retention & Development (later called Talent Management) only burst onto the scene after McKinsey talked about the future “war for talent”. It very quickly took over from the older concept of Succession Planning and suddenly became the new focus of Directors and Consultants in major organisations around the globe. These days it is not only seen as the current big thing in large organisations but is becoming an issue for small and medium sized enterprises (SMEs) too.



It was the realization by McKinsey that people would, in future, be the source of competitive advantage and this would need not only the retention of leaders but also the retention and development of key personnel across the entire range of functions of a company which first led them to declare the “war for talent”. This war has continued for some time and is still going on and although there are now some who question the validity of this approach it still drives much of the work of HR.



Today the concept of talent management has evolved to be a common and an essential management practice. So what was once solely attached to recruitment now covers a multitude of areas ranging from organisational capability through individual development, team development and performance enhancement to succession planning. It is recognised that there is a strong business case for taking a strategic approach to talent management and many CEO's, as well as HR Directors, are now willing to list talent management among their key priorities.



A strategic approach to talent management is seen as key for organisations to gain competitive advantage they need and this, of course, has to suit their business model and elicit best from their people. The true value of a well designed, talent management process which operates organisation-wide is that it can provide a focus for investment in human capital and will place the subject high on the company’s agenda. It can also contribute to other strategic objectives, such as building a high performance workplace, encouraging a learning organisation, adding value to the employer of choice and branding agenda and contributing to equal opportunities & diversity management. Therefore a strategic approach to talent management can provide a host of tangible benefits that cross over into other areas of the HR function as well as other aspects of the business.



Definitions



Organisations often find it of greater value to formulate their own meaning of what talent is than following prescribed definitions and there can be significant differences in how talent is defined across different industries and sectors. However to start with a broad definition as a basis to work from can be of great use. These are two definitions derived from past research undertaken by the Chartered Institute of Personnel and Development (CIPD) in the UK



- “Talent consists of those individuals who can make a difference to organisational performance, either through their immediate contribution or in the longer-term by demonstrating the highest levels of potential.”



- “Talent management is the systematic attraction, identification, development, engagement/ retention and deployment of those individuals who are of particular value to an organisation, either in view of their 'high potential' for the future or because they are fulfilling business/operation-critical roles.”



The second definition shows the importance of recognising that to just attracting individuals with high potential is not enough. Developing, managing and retaining those individuals as parts of a planned strategy for talent are equally important, along with adopting systems to measure the return on this investment. Many organisations are now broadening their definitions to look at the 'talents' of all their staff and to develop their strengths.



Key Aspects



The CIPD research goes on to identify the common aspects of Talent Management which consistently arise across business and sectors. These are:



“- A successful approach is based on an agreed, organisation-wide definition of talent and talent management. Such definitions form the springboard from which both talent strategy and talent management processes can be launched.



- In addition, a language for talent management activities that is understood by all the parties in the employment relationship is a strong requirement.



- A proactive, strategic approach to talent management offers considerable organisational benefits in terms of developing a pool of talent as a resource to meet identified needs.



- Support for talent management must flow from those at the very top of an organisation and cascade throughout.



- Engaging line managers from an early stage is critical to ensure that they are committed to organisational approaches to talent management.

- Talent management can be used to enhance an organisation's image and supports employer branding in the labour market as well as a providing a means of enhancing employee engagement to improve retention.



- Talent management activities should be developed with other HR policies and practices for a joined-up approach. Developing talent may be based on a blend of informal and formal methods.



- Processes must be developed to track the performance and progress of those identified as talent.”



As can be seen from these Talent Management has to be a dynamic process closely linked to the strategic objectives of a company. It has to monitor and adapt to the changing needs within the company and the priorities it sets and at times can even drive those changes necessary.



Conclusion



Talent Management today is one of the “Keys to the Future” for many companies. Its effects run through companies, wider than just HR, to the core of the businesses themselves. Done correctly talent management can help address not only operational issues within companies giving them a brighter future, but also equality issues which increasingly arise today. Those managers who fail to understand that and those companies which fail to act in the right way will loose “The War for Talent” and see their operations suffer accordingly.





(Quotes are taken from the CIPD publication “Talent management: an overview” ©CIPD - 2009)



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Do not hesitate to contact me with any questions about Talent Management, however please be patient as I may not always have the time to answer promptly. I have to earn a living too.



Neil Jones