Talent management is a modern term used in human resources to put a planned and measured focus on developing employees throughout their career within a company through various means, from earning an online BBA with a concentration in Human Resource Management degree or a post-grad online MBA degree to hands-on experience. This represents a giant leap forward compared to days gone by.
Rather than only focusing training efforts on those who show the most promise in a business – as was popular in the past – smart companies now focus on cultivating leadership from within. This ensures companies not only get a return on salary payouts now, but also into the future as the employee takes on more responsibility in a role where their ideas and decisions have more of an impact on company revenues.
Employees promoted from within grow with the company, taking all the company-specific knowledge they’ve gained over the years up the chain of command with them. Compare that with hiring an experienced manager externally, who needs to assimilate into the company and learn how to use their experience in an entirely different setting, and the advantages become very obvious.
Talent Management Strategies
A study completed by Pricewaterhouse Coopers and the Project Management Institute identifies the following 3 strategies for developing a talent management program:
- Identifying and recruiting the right people.
- Developing and retaining employees.
- Capturing and transferring relevant knowledge.
The study recommends using these 3 proven concepts as the base your own in-house talent management strategy for sourcing and cultivating future management for your company.
Reasons for Developing and Using a Talent Management Strategy and Process
The process of developing employees from within is an expensive and very time-consuming process. There’s always the fear the employee will take all that costly training with them to another company at some time in the future, effectively making such an investment very risky.
However, the benefits of doing so far outweigh the risks:
- A more talent-heavy staff equals better overall company performance in the market.
- In-house talent is essential to creating brand value for consumers.
- The global business environment is becoming increasingly complicated, requiring employees have more extensive training to bear these increased responsibilities.
- Employees, particularly the millennial workforce, are demanding more accountability and meaning from the jobs they take on, making the idea of helping them max out there talent a worthwhile risk for any company to assume.
Some 60% of all businesses polled in a Cranfield School of Management study said talent management was essential to their company’s current and future goals (source).
There are many other benefits to training and promoting from within, which have a significant impact on a company’s continued growth, for example:
- Promoting from within using a talent management strategy leads to increased innovation, cementing the company’s competitive advantage.
- It also leads to happier, more fulfilled employees, and drastically lowers turnover rates due to the freedom they’re given to grow into other roles and increasingly add value to the organization.
- Developing loyal talent from within is more cost effective than recruiting, hiring, and training external talent – imported talent who may or may not give their loyalty so freely as an employee who has been encouraged to grow with that company from day one would.
After realizing the benefits of including such a strategy, the real challenge begins.
How to Create and Implement a Talent Management Strategy and Process
There are no firm rules as to how a talent management system should be developed. There are however, suggested practises that most experts agree need to be part of any successful plan:
1. Clearly defined job performance metrics
Employees need to have a clear definition of their current position, as well as goals they’re expected to strive for in order to facilitate successful advancement. Incentives must also be clearly laid out, and not be treated as a once-in-a-while surprise whenever management feels generous.
- How is their job success defined?
- How/when will performance be evaluated?
- What are the consequences of poor performance?
- What advantages will they gain when they meet or exceed expectations?
These and other metrics need to be clearly defined and expectations need to be explained and adhered to.
2. All staff must be involved in talent management and the company’s future
Everyone in the company must be strategically aligned with the talent management plan and committed to the company’s long-term goals.
This means both managers and employees need to be aware of how the company plans to expand and improve its efforts in the marketplace. They also need to be encouraged to collaborate among themselves and with management in the attainment of those initiatives.
3. Use “Nine-Boxing” to encourage employees to strive toward advancement
A company is only as strong as its weakest link. In using your talent management strategies to build a team that will be ready for the company’s future needs, it’s imperative to focus on current team, as well as individual talents, and to compare present metrics to the talents and company structure that will be needed in the future once key milestones are achieved.
This free HR.com PDF download explains how to use “Nine-Boxing” to assess employees based on past performance and what they need to arrive at their future potential.
4. Continued implementation of training and development strategies to achieve goals derived from Nine-Boxing sessions
After Nine-Boxing company talent and figuring out what they need to succeed, a plan of action must be developed to get them there. For instance, receiving mentoring from people in the positions they’ll one day hold, or seeking professional mentors from outside the company if those positions don’t already exist.
Cross-training with different positions, and offering online or offline coursework will familiarize an employee with all facets directly and indirectly related to their future role in the company. Employees also benefit from taking on a few of the very responsibilities they and you hope they’ll occupy and seeing how they do with the increased workload.
5. Focus on retaining talent and encouraging them to aspire to their professional goals
Employees who are happy in their jobs are not just more loyal to their employers, they also do their jobs better than their unsatisfied counterparts. There are a few key factors a company can employ in this area, in order to make their talent management plan successful:
- Help them define their idealo work/life balance, and do your best to accommodate those needs.
- Commit to giving regular salary increases, performance bonuses, and health benefits to ensure they don’t feel they have to look elsewhere.
- Make career-pathing just as important as performance metrics, to most accurately match the employee’s unique abilities with their future goals and aspirations within the company.
Using a Talent Management Strategy is Worth the Effort and Financial Risk
When all is said and done, a company that takes the time and invests its money in a well-thought-out talent management strategy will be far better off than one which does not.
Your talent pool will be much stronger, more well-equipped to make decisions on their own, and in the end: More loyal to the company they work for because you’ve put so much thought and effort into their professional development and job satisfaction.
Make no mistake, there will be failures. This is true with any investment; you win some and lose some. We’re all living in a world where 60-percent of millennials find themselves with the desire to job-hop in order to find work where they’re made to feel valued and more engaged with the day-to-day and future plans of the companies they work for.
A talent management strategy helps to stifle this desire and keeps mold-able talent in the company, rather than taking all the skills you’ve taught them to the competition.