Britain's employers are ignoring the advice of HR professionals and risk losing their top people because of a short-sighted failure to invest in efforts to identify, develop and retain talent.
A survey of senior HR managers by consultants Fairplace has found that two-thirds of organisations had not allocated a specific budget for the retention of their most talented employees.
Half of those interviewed believed that funding for this objective should constitute up to a fifth of their HR budgets, while one in three believed it should exceed this. But in reality, nine out of 10 HR managers could only allocate half this amount.
The survey also showed that almost six out of 10 (57 per cent) employers had no distinct talent management strategy, risking future deficits in this vital area.
Despite this lack of organisational support, HR professionals clearly believe in the value of developing talent. Six out of 10 agree that offering staff development opportunities and career challenges is the top tactic in the battle to keep hold of star workers.
The Fairplace research is only the latest to highlight an underlying disconnect between HR professionals and their organisations. Last month, consultancy Deloitte reported that one in four organisations do not see human capital measurement as a priority for their business, and a fifth of large firms do not even expect to put it in their annual reports.
This is despite the fact that employment costs typical account for between 40 and 67 per cent of most organisations’ cost base. Moreover, talented workers are 25 per cent more productive than average employees and the cost to UK businesses of staff resignations and losing workers to rival firms runs into millions of pounds every year.
Research by the Chartered Institute of Personnel and Development (CIPD) has also found that a lack of training and developmental opportunities is one of the major reason for voluntary turnover.
More than four out of 10 (44 per cent) of respondents in CIPD studies cited ’promotion outside the organisation’ as a main cause of labour turnover, while more than a third (37 per cent) pointed to ’lack of career of developmental opportunities’.
Michael Moran, CEO of Fairplace, said: “We are seeing a strong belief in the HR value of talent management, but HR managers need to be more supported by their organisations in its application.
"In the future, we should expect to see increasing numbers of firms putting more funding towards this area. After all, if they don’t look after their top staff, more organised rivals will”.