No Image Available

Stuart Lauchlan

Read more about Stuart Lauchlan

Talent Management: The market landscape

pp_default1

It’s talent that’s the challenge, never more so than in the middle of the worst set of economic conditions since the 1920s. And that challenge is only going to get tougher with pay rises that are flat – or non-existent – taking away one of the most obvious motivational incentives.

According to the  Deloitte 2013 Top Five Global Employer Rewards Priorities Survey, finding, motivating and keeping talent will remain the top challenge for HR leaders around the globe. Shortage, motivation, and retention of qualified talent far outpaced all other choices with the majority of all respondents (26%) citing it as their main problem.
 
The solution is effective talent management – but that of course may be easier said than done. A good starting point though would be agreeing on a definition. There are multiple interpretations of the term, understandably enough given the differing natures of the various business sectors.
 
According to the CIPD, talent is "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" while 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".
 
 
 
                                                                                                Source: Deloitte
 
To provide an indication of why talent management matters, a recent PriceWaterhouseCooper study found that CEOs find themselves changing their talent strategies more often than their approaches to risk management, with skills shortages seen as the main threat to continued commercial expansion.  One in four CEOs cited instances when they were unable to pursue a market opportunity because of lack of available talent.
 
With that in mind, it’s clear that talent management needs to be strategic, not a series of tactical initiatives, if businesses are to have a chance of mapping how their talent management needs are likely to evolve.
 
Interestingly two thirds of respondents to PwC’s study expect talent to come from within organisations rather than from outside, suggesting that internal talent management is the critical priority.
 
"Four years into the financial crisis, we find CEOs more grounded about the risks and changing conditions for
growth," notes Dennis Nally, PwC Chairman. "The focus on talent and customers today is a natural ‘next step’ towards establishing their organisations in the markets where they operate and building the trust needed for the business of tomorrow.
 
"That’s why so many CEOs are changing talent strategies to improve their ability to attract and retain the right people. Skills shortages are very real – just 12% of CEOs say they’re finding it easier to hire people in their industries – and the constraints are having quantifiable impacts on corporate growth. Just as our customers are changing rapidly, so are our workforces – and our talent needs are changing, too."
 
It’s a view backed up by the annual Talent Management Survey conducted by HR services provider NorthgateArinso (NGA). That finds that 87% of business people believe that talent identification would be critical to the success of their organisations over the next three years while more than half – 51% – believed that their industry suffered from a lack of suitable candidates.
 
“Talent management – in particular ensuring that existing talent can be nurtured, new talent can be attracted, and key positions can be replaced if necessary – is a critical concern of businesses," says Michael Custers, Vice President of Strategic Marketing at NGA. “There is a real worry out there that there is a lack of readily available talent and that potentially this will impact on a business’s ability to deliver its strategic vision."
 
Picking talent
 
All of this makes it all the more necessary to select a suitable Talent Management solution to support an organisation’s strategic objectives. Of late there has been a period of turmoil and consolidation in the Talent Management software market with the likes of Taleo and SuccessFactors and Rypple begin taken over by Oracle and SAP and Salesforce.com.
 
This expansionist strategy is quite deliberate. "SuccessFactors has defined the talent management space and leads with our world-class Performance, Succession and Learning solutions," rationalises Lars Dalgaard, founder of SuccessFactors and now heading up SAP’s Cloud business following its takeover of the HCM firm. "Our acquisition of Plateau Systems in 2011 was one of many legendary moves toward adding robust learning management capabilities and talent that created a rich, unified BizX Suite.
 
"Now, as an SAP company, we have 700 specialists in core HRIS running at high velocity and delivering the strongest, most global and comprehensive Cloud system of record. We are hungry to continue to lead in the industry and to amaze customers with our gorgeous, intuitive products and aggressive dedication to the Cloud."
 
That Cloud model has seen the spawning of a number of new HCM challengers, most notably Workday. Add to that, the increasingly prevalence of social media solutions such as LinkedIn and Facebook as part of both internal and external talent strategies and the HR professional today has no shortage of options. This does also of course mean that evaluation, selection and deployment of talent solutions is more complicated than ever.
 
"For the world’s most successful companies, the selection of a talent management platform has become a strategic business decision," says Adam Miller, CEO of provider Cornerstone OnDemand. "These organisations understand the massive returns that the right solution can offer by helping them effectively address the challenges they face in powering and maximizing the productivity of their most important asset, their people.
 
"Therefore, as the concept of talent management continues to mature, we believe our momentum will only grow stronger, the best-of-breed functionality increasingly winning out over these minimal convenient and immaterial cost savings that ERP vendors solutions offer today," he adds.
 
Changes are occurring in the way people recruit, argues Miller, something which Cornerstone recognised two years ago. "Organisations were increasingly leveraging their entire workforce rather than just recruiters, the source of best talent can create internal and external candidate pipeline," he says. "Understanding this change, we began building our recruiting Cloud to be natively social and deployed to all employees within an organisation, allowing companies to accommodate the way people like to recruit today rather than force them to recruit the way it was done 10 or 15 years ago."
 
Inside out
 
When selecting a solution it is of course necessary to be aware of what problem you’re trying to tackle: internal or external talent management. 
 
"With internal talent management, the big challenge is building up a robust talent pipeline so that employees can move around the business," explains Richard Doherty, HCM strategist at Oracle. "What most organisations struggle with is having the right data on their employees so that they can make more informed decisions about how they can move around.
 
"With external talent you’re looking for to the future. Historically you’d engage with talent linked to the recruitment process. You’d have a vacancy, raise a requisition, pass that over to the recruitment team and so on. But now organisations realise that they need to build up external talent pipelines so that they have an external talent community into which they can dip when they need to.
 
"Organisations need to be able to communicate with people who are not yet actively looking for a new role," he adds. "These are passive candidates, people who have skills that you might need or want to dip into in the future. You can use social media to connect with those passive candidates."
 
Social play
 
Social media is also playing its part in increasing the complexity of the HR solutions market with LinkedIn the most notable social network to stake a claim to the talent market.
 
"Our larger customers are more deeply integrated talent pipeline into existing recruiting workflows," says Jeffrey Weiner, CEO of LinkedIn. "Historically, we’ve always started with a core focus on knowledge workers, which is how we more narrowly defined professional and that plays directly into our mission statement to connect the world’s professionals, make them more productive and successful.
 
"Through various methodologies we’ve determined there’s roughly $600 million-workers in the world and that remains the heart of focus, the core of our focus, but our vision is something broader than that," he adds.  "Our vision is to create economic opportunity for every professional, professionals is defined as someone that earns a living from their skill, and using that much broader definition there’s as many as 3.3 billion people in the global work force and that vision is a dream.
 
"I mean, that’s our true north and much longer term. That where we want to be able to focus,’ he concludes. "By virtue of leveraging a sales person or business development professionals LinkedIn network can not only identify the most valuable target prospect, but they can determine the most efficient way and most effective way to connect with that person."
 
Oracle’s Doherty suggests that organisations should also look to leverage the social media networks of their existing employees. "I have a reasonably large network on LinkedIn and most of those people will have HCM connections," he notes. "If Oracle could leverage my own network they would be able to connect with a lot of passive candidates. If organisations were to leverage their employees networks they could connect with a huge talent pool."
 
But while being a fan of LinkedIn himself, Doherty does warn that organisations need to up their game. "There is a certain lethargy around LinkedIn because we’re all getting approached by recruiting firms as a result of them accessing it," he argues. "The analogy would be a double-glazing sales man coming into a pub. interrupting conversations and asking people if they want to buy double-glazing. Now we have headhunters firing random jobs at you.
 
"People who take that approach need to get cleverer," he concludes. "It will be the clever organisations who think about strategies for how to use social media that will be the most successful."
 
 
Box Out: Three strategic tips for effective talent management
 
Consolidate the technology you are using to help integrate processes
The survey found more than half of businesses are using between two and five technology tools to manage talent management processes. Having a dispersed network of talent management tools decreases HR data quality, complicates the integration of HR processes, and impacts negatively on reporting and analytical results.
 
Articulate a strategy and assign experts to execute
With so many business leaders concerned that talent management is a critical issue for them, it is surprising that so few have a well-articulated strategy in place. Only 66.5% have a strategy and 40% combine it with HR roles. Having dedicated experts developing an integrated strategy across various talent management processes will help to solve the challenge of retaining and identifying talent.
 
Free up time & resources to dedicate to talent strategy
71% of business leaders surveyed agreed that more could be done in their organisations for HR to be recognised as a driver of business strategy. Businesses should consider automating or outsourcing tactical day to day tasks to ensure HR teams are not distracted from focussing on implementing talent management processes that will ensure the business has the people it needs to meet its wider objectives.
 
Source: Northgate Arinso
 

One Response

  1. Are they really motivating?

    This is an interesting study. Employers say that finding, motivating and keeping staff are the top priorities, but are they really doing anything about it? 

    Many think that pay is the biggest motivator when actually, studies have shown the true appreciation and working towards a clear and shared objective with the freedom to make your own choices is just as important.

    Talk to accessplanit for your businesses training management system and training management software needs.

Newsletter

Get the latest from HRZone.

Subscribe to expert insights on how to create a better workplace for both your business and its people.

 
 
 
 

Thank you.