Business leaders are certainly ‘talking the talk’ when it comes to promoting talent management as a way of creating competitive advantage. But new research has uncovered a huge gap between talent management rhetoric and reality, with uncomfortable implications for many employers.
Research carried out by talent management consultancy TalentMax found that fewer than a third of organisations actually have talent management strategies in place.
Based on interviews with 128 professionals from a range of business sectors comprising 39 business leaders, 42 HR directors and 47 corporate high-flyers, the results paint a sorry picture of the way that UK organisations manage their most precious assets.
"Few organisations do more than pay lip service to talent management," said TalentMax‘s Susannah Pringle.
"In the knowledge economy the ability to translate talent potential into profits and performance dictates organisational success or failure. Employees need to upgrade, repackage and proactively market their talents to survive. Employers and employees who neglect the new career status quo do so at their peril."
For employers, the clear message is that poor talent management will almost inevitably lead to key employees heading for the door. The research found that talented individuals are more mobile than ever, with a mere 15 per cent of them feeling that their organisation makes the best use of their talents. What’s more, eight out of ten said that their manager was the main reason for leaving an organisation.
But at the same time, the HR directors interviewed acknowledged that it is not enough just to hire the right talent. Bringing in people is the easy step, they say. The real challenge is to nurture and engage talent over the long term. And for talent management to succeed, nine out of ten HR directors believe that it must be championed by the Board then implemented by line managers.
But crucially, only a quarter of the HR directors said that their organisation is currently able to accurately and consistently identify high and low performers.
For the minority of organisations that are taking talent management seriously, TalentMax says that the rewards are substantial. And it points to examples of best practice such as:
- driving talent management from the boardroom: all business decisions have talent implications so translate business plans into talent management objectives
- making people accountable for talent management: it should be a key factor in performance appraisals, compensation reviews and promotion decisions
- equipping line managers to be front-line talent conductors: providing coaching skills so that managers engage with, rather than alienate, their people
- understanding what makes individuals tick: identifying and meeting personal drivers, expectations and needs creates ultra-committed, high-performing employees
- keeping talent fresh: moving, developing, growing and evolving so that it continues to generate high performance.
According to Susannah Pringle, organisations that are serious about talent management need to see their HR functions develop leadership and innovation.
"HR must be seen to leave its administrative bunker and lead its company’s talent development,” she says. “Given the importance of talent to business success, the HR director of the future should rank alongside the finance director at the boardroom table.
"Talent management recognises that all employees drive business performance not just the superhero CEO. Talent management requires a different type of CEO,” she added.