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Karen O'Leonard

Bersin by Deloitte, Deloitte Consulting

Vice President, Analytics & Benchmarking

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Study finds UK organisations need to modernise their approach to talent management

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With a glimpse of economic recovery ahead, organisations are taking stock of their talent. In many companies, restructuring and downsizing have led to low employee morale, putting top talent at risk,  jeopardizing employee productivity, and compromising engagement. 

Companies need to take the time to review their career planning, succession management, development, and rewards programmes to make sure their employees are engaged and working toward long-term goals.

Smart companies realise that these talent activities are inextricably linked. However, a recent study shows that most UK companies still have traditional HR structures in which talent processes are independent or siloed, meaning there is little or no coordination across processes. The research, conducted by Bersin & Associates in partnership with HRzone.co.uk, reveals that most UK organisations have not adopted a cohesive, holistic view of talent. These organisations will struggle in their efforts to manage their talent in a way that is effective for both employees and employers.

Among the key findings, only about 30% of UK companies have a well-defined talent strategy in place today. Talent management begins with a business-driven talent strategy, which is how the organisation plans to meet its talent challenges and enable its critical talent to fulfil its business goals. A key piece of talent management is identifying critical talent segments and creating tailored talent programmes for these segments. For example, UK-based SHL Group recognises that retaining key employees will become more difficult as the economy improves. Therefore, the company is taking proactive steps to identify ‘at risk’ employees and to create tailored talent initiatives to improve engagement and retention among these individuals.

In some UK companies, HR managers may need to work collaboratively with unions or worker advocacy councils when defining and tailoring programmes for talent segments. These segments must be set up carefully to avoid discrimination and unfair practices. Therefore, HR needs to work closely with the appropriate groups when developing targeted talent initiatives.

Approximately 40% of UK organisations have a traditional HR structure in which talent processes are developed and managed individually. In these organisations, talent initiatives are owned and driven by HR, rather than by business leaders and managers. A greater number of U.S. companies, by comparison, have advanced past this stage and are further along the path of integrated, business-driven talent management. UK organisations need to move beyond this separation of talent functions to adopt a more holistic view of the flow of talent. They must also engage business leaders and managers in taking responsibility for talent initiatives. A major UK health services provider, for example, has launched an initiative to implement a more thorough approach to talent management and to make it an integral part of its annual business cycle. Using this type of approach will elevate the importance of ‘beginning-to-end’ talent management – starting with recruiting and continuing throughout the employee lifecycle – and will make sure that talent initiatives are supported, and eventually owned, by business leaders.
 
On the positive side, HR professionals in the UK appear to have a longer-term perspective on the employer-employee relationship than their U.S. colleagues. As a result, many UK companies have well-defined career management and succession management programmes. These organisations view long-term employee development and mobility as being key contributors to the health of the business. U.S. companies, by comparison, tend to be more short-term focused, with sharp cuts in headcount during poor economic times, and hence a more limited view of employee development and career planning.

Nearly 40% of UK organisations have no talent systems in place today. These companies are using manual processes for all of their talent activities, including recruiting or applicant tracking, performance management, learning, and succession and career management. Solution providers may see the UK as an attractive opportunity, but they will need to tailor their approach to meet the needs of these buyers. For example, since talent processes are still largely separate, systems vendors will likely be selling point solutions initially, with a path to adding more functionality in the future. Their sales cycle will be complicated by having to work with multiple HR personnel, since in most companies there is no single owner for talent management.
 

  • For more details, download the executive summary from this study, ‘UK Talent Management Factbook 2010: Best Practices and Benchmarks in UK Talent Management’, at the Bersin website. In addition, stay tuned for an announcement so you can register for the webcast of findings from the study.

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Karen O'Leonard

Vice President, Analytics & Benchmarking

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