Talent Management

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Abstract: Numerous attempts to formalize the talent management as a strategic
practice by the corporate have been mostly focused on corporate framework, policies and overall organizati on model and systems to drive talent management and succession planning. Mostly talent management has been presented from a HR manager‘s perspective. Major issue with such approaches is that it does not provide simple to use toolset to the direct manager to manage the talent, succession planning and bench strength. The practical approach to talent management starts with right pre‐hiring process, on‐boarding, performance evaluation and review of long‐term potential. This paper presents a practical model with a set of processes and activities a direct manager need to perform to ensure management of key talent, ensure systematic development of succession plan and developing bench strength. This paper deals with practical aspect of talent management and succession planning from a direct supervisor perspective rather than from a HR manager‘ s perspective. A simplistic tested model has been presented to equip present day busy management professionals with the ability to align hiring, on‐boarding, performance review and talent review practices with talent management goals.

RESEARCH OBJECTIVES
    To understand what is talent management To understand the entire process of talent management To understand the need of talent management To study the accuracy & quality of work of employees by talent management

What is Talent Management?
Talent management is a complex collection of connected HR processes that delivers a simple fundamental benefit for any organization: Talent drives performance. We all know that teams with the best people perform at a higher level. Leading organizations know that exceptional business performance is driven by superior talent. People are the difference. Talent management is the strategy. Analyst research has proven that organizations using talent management strategies and solutions exhibit higher performance than their direct competitors and the market in general. From Fortune 100 global enterprise recruiting and performance management to small and medium business eRecruiting, leading companies invest in talent management to select the best person for each job because they know success is powered by the total talent quality of their workforce.

The Talent Age
In 1997, a McKinsey study coined the term: war for talent. Now in the new millennium, we find ourselves in the talent age. During the agricultural age, the economy was based on land, a truly physical and very tangible asset. The industrial age followed with a manufacturing-driven economy. Higher business performance was derived through the most effective use of factories and distribution networks. The knowledge age moved the basis of economic value to information assets through integrated communications and computer technology. Now the competitive battlefront is for the best people because they are the true creators of value.

History
Talent management is a term that emerged in the 1990s to incorporate developments in Human Resources Management which placed more of an emphasis on the management of human resources or talent. The term was coined by David Watkins of Softscape[2] published in an article in 1998 [3]; however the connection between human resource development and organizational effectiveness has been established since the 1970s [4]. Talent management is part of the Evolution of Talent Measurement Technologies. The issue with many companies today is that their organizations put tremendous effort into attracting employees to their company, but spend little time into retaining and developing talent[Need quotation to verify] . A talent management system must be worked into the business strategy and implemented in daily processes throughout the company as a whole. It cannot be left solely to the human resources department to attract and retain employees, but rather must be practiced at all levels of the organization. The business strategy must include responsibilities for line managers to develop the skills of their immediate subordinates. Divisions within the company should be openly sharing information with other departments in order for employees to gain knowledge of the overall organizational objectives.[5] Companies that focus on developing their talent integrate plans and processes to track and manage their employee talent, including the following:
     

Sourcing, attracting, recruiting and onboarding qualified candidates with competitive backgrounds Managing and defining competitive salaries Training and development opportunities Performance management processes Retention programs Promotion and transitioning[6][copyright violation?]

The talent management strategy may be supported by technology such as HRIS (HR Information Systems) or HRMS (HR Management Systems). Modern techniques also use Competency-based management methodologies to capture and utilize competencies appropriate to strategically drive an organization's long term plans.

The New HR Mission and Talent Management Processes
Many challenging workforce issues confront HR, including:
      

Heightened competition for skilled workers. Impending retirement of the baby boomers. Low levels of employee engagement. Acknowledgement of the high cost of turnover. Arduous demands of managing global workforces. Importance of succession planning. Offshoring and outsourcing trends.

This requires new thinking and a new mission to achieve business success. These factors—coupled with the need to align people directly with corporate goals—are forcing HR to evolve from policy creation, cost reduction, process efficiency, and risk management to driving a new talent mindset in the organization. One important distinction is the evolution of the difference between tactical HR and strategic talent management. Transactional HR activities are administrative overhead. Talent management is a continuous process that delivers the optimal workforce for your business. In this new model—instead of being the owners of processes, forms, and compliance—HR becomes the strategic enabler of talent management processes that empower managers and employees while creating business value. With this view, talent management may be defined as the implementation of integrated strategies or systems designed to improve processes for recruiting, developing and retaining people with the required skills and aptitude to meet current and future organizational needs. Anecdotally, talent management is often defined as performance management, incentive compensation, or talent acquisition. Talent management is also often confused with leadership development. Although leadership development is a crucial function of your organization, focusing on it exclusively is a legacy of last century. Our modern service and knowledge economies in the talent age require a broad and holistic view. A high performance business depends on a wide range of talent. Taleo‘s graphical representation emphasizes the mandate of talent management to respond to business goals and consequently be the driver of business performance. Talent management is depicted as a circular—not a linear—set of activities.

Why Talent Management?
Workforce cost is the largest category of spend for most organizations. Automation and analysis of your recruiting and hiring processes provides the immediate workforce visibility and insights you need to significantly improve your bottom line. Performance management provides the ongoing processes and practices to maintain a stellar workforce. Today, many organizations are struggling with silos of HR processes and technologies. The future of talent management is embodied in solutions designed from the ground up to provide business-centric functionality on a unified talent management platform. Since nearly all competitive business factors have become commoditized, talent is what ultimately drives business success and creates value. Leading organizations rely on Taleo solutions and services to assess, acquire, develop, and align talent with business objectives while significantly reducing process costs, improving quality of hire, reducing risk, and achieving higher levels of performance. Though it may seem intuitive, it is worthwhile to articulate the fundamental significance of successful talent management practices:
  

The key enabler of any organization is talent. The quality of your people is your last true competitive differentiator. Talent drives performance.

Talent management requires strong executive support, along with systems and processes all directed towards having the right talent doing the right work at the right time. That‘s when talent truly drives higher business performance

Best practices only work in a given context, says Günter Stahl, INSEAD Associate Professor of Organisational Behaviour. ―So what works for one company may not work for another.‖

That‘s one of the key findings of The Global Human Resource Research Alliance, a study of best practices in talent management on which Stahl was a lead researcher. It investigated the processes and practices of 37 multinational companies, selected on the basis of their international scope, long-term performance and reputation. Cultural fit Stahl says it‘s important before adopting best practices to understand why they work for some companies, and to consider whether they will be as successful in a new corporate environment. Stahl notes the example of General Electric‘s forced rankings system which places executives in one of three categories: the top 20 per cent of performers; the adequate – but vital – middle 70 per cent, and the bottom 10 per cent. GE used the system as the basis for succession planning, leadership development, as well as for decisions related to evaluating the effectiveness of individual employees. While the system was well aligned with GE‘s meritocratic and performance-driven corporate culture, some firms that emulated it found that it resulted in lower morale, reduced trust in management, and attrition among the vital 70 per cent who may feel undervalued. Even GE has felt such effects and is now introducing greater flexibility in the system, Stahl says. Similarly, 360° feedback systems would not succeed in very hierarchical organisations where employees are not comfortable giving supervisors their honest feedback. The culture of a particular society also plays an important role in determining the cultural fit of talent management practices, Stahl says. Even companies that otherwise have very advanced programmes promoting diversity, including sexual orientation, have chosen not to implement such programs in Asian countries where this topic is not openly discussed. Companies are also increasingly hiring employees whose personalities and values reflect those of the organization. For example, furniture retailer IKEA selects staff on the basis of their attitudes, values and cultural fit with the company as much as for their qualifications. This is because, in some professions at least, job-related skills are not always the best predictor of performance and can easily be changed, while values and personalities cannot.

Synopsis of talent management best practices

Recruitment and staffing

      

Talent pool strategy rather than hire for specific positions Close relationships with leading business schools and universities Highly selective hiring Compelling 'employee value proposition'; strong emphasis on global branding Focus on values and cultural fit, not just job-related skills and experience Continuous assessment of performance and potential Grading against competency profiles of successful leaders

 

Use of talent inventories for selection/succession Different talent pools (executive/specialist)

Training and development

      

Leadership development is a top priority and deeply ingrained in culture Promotion-from-within policy Continuous assessment of training needs/feedback (360 degrees) Individual development plans linked to succession planning process Job rotations and international transfers as career development tools Line manager involvement (coaching, mentoring, etc.) Use of open job posting system and internal talent marketplaces

Retention management

     

Continuous monitoring of attrition rates Highly competitive compensation Personalised career plans Senior management attention Flexible working arrangements Diversity programmes designed to develop, retain and promote diverse talent

© Günter K. Stahl, The Global Human Resource Research Alliance

The employee value proposition According to the study, compensation is no longer the primary concern, as potential employees seek to join firms whose values are aligned with their own. This means, Stahl says, in order to be an employer of choice, it‘s crucial for firms to differentiate themselves from their rivals, and create and deliver unique employee value propositions. These centre on both tangible and intangible elements – which, while they include competitive salaries, also take into account the values and reputation of a particular firm, as well as opportunities for career and leadership development, and work-life balance.



Values and reputation

Companies which are successful in attracting and retaining staff focus on creating a global brand that reflects their corporate culture and values, and market this brand to potential recruits, who are looking to work for firms with values they ascribe to. Building a brand and reputation brings in more prospective employees, thus allowing more selective hiring. Indian IT outsourcing firm Infosys, for example, operates a global internship programme called InStep which selected 69 students out of 8,500 applications in 2005 and took them to the company‘s main campus in Bangalore for three months. The firm‘s branding initiatives appear to be paying off in terms of enlarging its pool of potential talent – it ended up hiring 15,000 software engineers in 2005 out of some 1.5 million applicants.


Opportunities for career and leadership development

Employees are more likely to join stay within an organization if they believe the prospects are good for longer-term career and leadership development. The firms that have been most effective in terms of talent management, according to the study, are those in which top management treat the issue of leadership development as a top priority. Procter & Gamble CEO A.G. Lafley, for example, spends between one-third and half of his time on leadership development; while IBM invests more than US$700 million annually on staff development. According to the study, employees also appreciate continuous feedback on their performance, and opportunities to move around the company- between different roles, departments and even countries. Stahl notes that the culture within a particular organisation must facilitate such developments, with line managers also playing a key role in coaching, mentoring, and encouraging staff to move within an organisation, rather than try to hold on to their best talent.


Work-life balance

As more and more people look for a healthy balance in their professional and personal lives, particularly among the younger generation of professionals, an increasing number of companies are competing for talent by offering flexible work arrangements. Stahl says that the most advanced in this respect are professional services firms and investment banks. One programme that has been successful in reducing the attrition rate of women, and increasing the number of female partners is Accenture‘s Work-Life Balance programme. This programme, which offers options such as flextime, job sharing, telecommuting, and ―flybacks‖ for people working away from home, has since been opened up to male employees as well, and has been credited with improving team productivity, job satisfaction and personal motivation. There are plenty of initiatives then which show that companies are increasingly treating talent management as a top priority. However, the study concludes that few human resource professionals, senior executives and line managers believe that their organisations have fully solved the ‗talent management puzzle‘. While there are some effective practices for attracting, developing and retaining talent, these will only be successful if they‘re in line with the company‘s business strategy, all elements of its HR system and are embedded in the firm‘s value system.

Talent Review
Having established the departmental context of needed roles and skills, management teams can then proceed with a facilitated review of ―talent‖ in the organization. Talent management discussions can be structured in a variety of ways depending on department need. Examples include:


Talent Inventory focuses on current performance and future potential of a selected employee group. The goal is to get a collective perspective of strengths, needs, and development opportunities for specific employees, and to identify the department’s “talent pool.” Readiness for key assignments or future jobs is considered.

Following group input about employees, the planning process continues with an inventory of possible development actions, including feedback, stretch assignments, and training. Managers are encouraged to follow up with development discussions, and then reconvene to refine development strategies. Some groups use a ―9-Box Grid‖ (PDF) as a planning tool.


Succession Planning focuses on possible succession for key job roles in conjunction with a general talent inventory. Management teams can also select specific, critical job roles to assess current and future bench strength. Discussion focuses on readiness to assume key roles, - “ready now,” “ready in 18 months,” etc.

This approach often highlights strengths and gaps relatively quickly. It provides leaders and managers with a context for discussing possible development assignments for high-potential employees to increase their readiness. A succession planning approach focuses on building the pipeline of internal talent. In this approach, a ―Readiness Grid‖ (PDF) is used as a planning tool.


Capability Analysis concentrates on the capability and availability of staff to provide continuity and back-up for key tasks and services. As an alternative to identifying individuals as potential successors for specific job roles, the manager or management team can apply a similar process at the department level by reviewing key tasks, responsibilities, and competencies that need to be maintained or developed in the group. Looking at readiness to perform specific functions can also highlight opportunities for cross-training and informal mentoring.

In this approach the focus is on departmental tasks and functions rather than specific job roles. A ―Capability Grid‖ (PDF) can be used as a planning tool.


Knowledge Transfer focuses on strengthening, developing, or transferring skills and knowledge in an organization through peer learning. It begins with an inventory of expertise in the department, and continues with a discussion about how to enable learning among co-workers.

Knowledge transfer initiatives enable managers to identify internal ―teachers‖ who can develop skills and knowledge of other team members. These departmental experts can be paired with other staff through informal mentoring or peer coaching relationships. Talent Review discussions surface the development needs of the department. This information provides the context for follow-up development discussions. In addition, talent review sessions help

managers identify on-the-job assignments and training that help prepare employees for future responsibilities. For help in facilitating a talent review, contact [email protected]. Talent management refers to the skills of attracting highly skilled workers, of integrating new workers, and developing and retaining current workers to meet current and future business objectives. Talent management[1] in this context does not refer to the management of entertainers. Companies engaging in a talent management strategy shift the responsibility of employees from the human resources department to all managers throughout the organization [1]. The process of attracting and retaining profitable employees, as it is increasingly more competitive between firms and of strategic importance, has come to be known as "the war for talent." Talent management is also known as HCM (Human Capital Management). The term "talent management" means different things to different organizations. To some it is about the management of high-worth individuals or "the talented" whilst to others it is about how talent is managed generally - i.e. on the assumption that all people have talent which should be identified and liberated.[citation needed]

[edit] Human Capital Management
Companies that engage in talent management (Human Capital Management) are strategic and deliberate in how they source, attract, select, train, develop, retain, promote, and move employees through the organization. Research done on the value of such systems implemented within companies consistently uncovers benefits in these critical economic areas: revenue, customer satisfaction, quality, productivity, cost, cycle time, and market capitalization.[7] [8] The mindset of this more personal human resources approach seeks not only to hire the most qualified and valuable employees but also to put a strong emphasis on retention. The major aspects of talent management practiced within an organization must consistently include:[9]
   

performance management leadership development workforce planning/identifying talent gaps recruiting

[edit] Evaluations

From a talent management standpoint, employee evaluations concern two major areas of measurement: performance and potential. Current employee performance within a specific job has always been a standard evaluation measurement tool of the profitability of an employee. However, talent management also seeks to focus on an employee‘s potential, meaning an employee‘s future performance, if given the proper development of skills and increased responsibility.
[edit] Competencies and Talent Management

This term "talent management" is usually associated with competency-based management. Talent management decisions are often driven by a set of organizational core competencies as well as position-specific competencies. The competency set may include knowledge, skills, experience, and

personal traits (demonstrated through defined behaviors). Older competency models might also contain attributes that rarely predict success (e.g. education, tenure, and diversity factors that are illegal to consider in relation to job performance in many countries, and unethical within organizations). New techniques involve creating a Competency architecture for the organization that includes a Competency dictionary to hold the competencies in order to build job descriptions.
[edit] Talent marketplace

A talent marketplace is an employee training and development strategy that is set in place within an organization. It is found to be most beneficial for companies where the most productive employees can pick and choose the projects and assignments that are most ideal for the specific employee. An ideal setting is where productivity is employee centric and tasks are described as ―judgment-based work,‖ for example, in a law firm. The point of activating a talent marketplace within a department is to harness and link individuals‘ particular skills (project management or extensive knowledge in a particular field) with the task at hand. Examples of companies that implement the talent marketplace strategy are American Express and IBM.[10]

[edit] Current Application of Talent Management
In current economic conditions, many companies have felt the need to cut expenses. This should be the ideal environment to execute a talent management system as a means of optimizing the performance of each employee and the organization. However, within many companies the concept of human capital management has just begun to develop. ―In fact, only 5 percent of organizations say they have a clear talent management strategy and operational programs in place today.‖[9]
[edit] Talent Review

To develop a clear talent management strategy and to increase awareness of available talent and successors, all organizations should conduct regular Talent Review meetings to be prepared for a variety of business changes, such as mergers, company growth, or a decrease in talent needs. In the same way that all companies have regular meetings and reports regarding their financial status and budgetary needs, the Talent Review meeting is designed to review the current talent status and future successor needs in the organization. The Talent Review meeting is an important part of the overall talent management process; it is designed to review the performance and career potential of employees, to discuss possible vacancy risks of current employees, to identify successors and top talent in the organization, and to create development action plans to prepare employees for future roles in the organization. "This is what talent management is all about — gathering information about talent, analyzing their career interests and organizational business needs, identifying top talent and successes, and developing these individuals to reduce the risk of losing the best people and experiencing extensive leadership gaps when turnover occurs." [11]

References
1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. ^ a b Article on Talent Management Origins ^ Softscape ^ Original Paper from Softscape ^ Schein, Edgar. Increasing Organizational Effectiveness through Better Human Resources Planning and Development. Sloan Management Review, 1977, 19:1 p. 1. ^ The People Problem in Talent Management ^ Talent Management FAQ - HR World ^ The Financial Value of Talent Management ^ Talent Management: How to Invest in your Workforce ^ a b Talent Management: State of the Industry ^ Making a Market in Talent ^ "Debunking Ten Top Talent Management Myths", Sims, Doris, Talent Management Magazine, December 2009.

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