'It won't last', they said. 'It's nothing new', they said. 'It'll fall out of fashion soon', they said. Yet the inscription 'RIP' has not been engraved into the headstone of talent management.
Since the phrase 'the war for talent' entered the business lexicon through the eponymous McKinsey-penned book, talent management has gone from strength to strength. Why has it flourished where other business philosophies have withered? Why have 44 per cent of organisations interviewed in summer 2004 already introduced a talent management programme with another 65 per cent of those without one planning to do so shortly? Why does talent management matter?
Catalyst 1: The rise of the knowledge economy
The information age has supplanted the industrial age and its intangible assets of intellectual capital and talent have eclipsed hard assets of factories and capital. People are the principal assets of an organisation. That is the new economic reality.
Catalyst 2: The talent drought
Decades of downsizing have killed the organisational lifer. The vertical career ladder has been tossed aside. The flat organisation, albeit financially desirable, excised swathes of experienced and committed middle managers – the leaders-in-waiting. Demographic trends have exacerbated the situation further, with experts predicting a serious shortage of employees until 2050.
Catalyst 3: The ownership challenge
Organisations do not exercise the same rights of ownership over their people assets as they enjoy over physical, financial and property assets. The relationship is of employment not ownership. There rests the challenge: an organisation's success or failure hinges on the quality and longevity of the relationships it forges with employees. Those employees can decide to return the next day or jump to greener pastures.
Catalyst 4: The desirability of promiscuity
With the job-for-life/employee loyalty contract a fading memory, today's talented employees are willing job hoppers. If they are not challenged, motivated, stretched, developed and remunerated properly they will leave. Changing jobs is a badge of honour.
The old organisational model of command and control leadership, of autocratic master-servant management and of adult-child relationships is crumbling. New times demand new solutions. Talent management recognises and embraces these trends that are re-sculpting the business landscape.
Talent management, with its emphasis on adult-to-adult relationships, on aligning employees and employers, on commitment rather than compliance, is gaining credibility. Talent management recognises that the balance of power between employer and employee has changed for ever. It is now a relationship of equals.
Talent management implements the following maxim: 'assign the right employee to the right role in the right environment with the right manager to unleash maximum performance'. It measures existing people practices through this simple lens and makes adjustments accordingly.
Forthcoming articles in this series will explore practical solutions for addressing key talent management challenges.