“The challenge today is getting the right people in the right place at the right time”
Ann Manikas, Vice President of Leadership and Organizational Development, ITW
Recently I was at a senior management meeting of a major global high-tech corporation. The meeting included the heads of the various HR departments who oversaw different parts of the talent management lifecycle: recruiting, selection, onboarding, training, performance management, leader development, compensation, and benefits, among others. During introductions these functional leaders described what they were doing in their particular areas of human resources. They shared an impressive list of cutting-edge practices:
It was an impressive list of accomplishments by a team of forward-thinking HR professionals.
I later learned that the reason the members of this HR team were at the meeting was that, in spite of these advanced systems, the company was losing a large number of their best people shortly after arrival. Furthermore, recent evaluations of their hiring process were abysmal, ratings of department efficiency were not where they needed to be, and line managers were complaining about the length and ineffectiveness of training. Worse yet, employee ratings of the effectiveness of performance reviews and the linkages between pay and performance were average at best. So what happened? Clearly, this company had some of the very best human resource systems. What was the problem?
The pattern exhibited by this organization is not all that uncommon. Because of its size and stature, the company dedicated many resources to individual talent management activities and had, in fact, applied some best practices in several areas. Unfortunately, these activities were not integrated or well connected, and often individual efforts appeared focused on the wrong priorities. The hiring of new managers, for example, met stringent time-to-fill requirements but supplied talent that did not always match the company’s capability requirements or culture. The public relations folks had described an employer value proposition that hummed in the talent marketplace, but the brand promise unfortunately could not be delivered by the organization.
Even in cases where the selection team hired the right competencies, the hires did not appear to be aligned with the culture of this organization. Similarly, while the onboarding technology was superb for transferring knowledge of the organization, customers, and job knowledge to new hires, it missed the mark badly on acculturation. Although the training organization appeared to be doing a fine job training for the competencies it had validated in its own job analysis study, its job analysis was different than the one used by the selection and performance management functions. Finally, while the pay research was impressive, it too was based on different criteria for the job than those being used for selection and performance reviews.
Confusing? You bet, and even a tad scary. If you consider the investment capital that went into each state-of-the-art activity and the mediocre return in organizational results, it is clear that this company had sub-optimized its talent management processes. Each function, in its zeal for excellence, had focused primarily on its own role. Even the company’s metrics reflected this sub-optimization. Measures such as “time to hire” and “fill rates” turned out to be penny-wise and pound-foolish when the people hired did not hit performance expectations or left the organization prematurely. Training completions with an “A” grade were of little consolation to line managers when people did not stay — and those who did stay often delivered C-level performances because they were not well aligned or engaged with the organization.
Overcoming Talent Process Sub-Optimization
What does an organization have to do to earn a high rate of return on its investments in talent management processes? Here is where the consideration of the full talentlifecycle — to be described momentarily—supported by an effective talent scorecard, high-impact metrics, and the People Equity model can be invaluable.
You may recall Chapter 3 addressed the connection and impact of People Equity to Customer and Shareholder Equity and discussed a variety of important human capital and business outcomes: productivity, quality, employee retention, and a strong internal supply chain. The good news is that People Equity has drivers and enablers that we can control or influence by effectively focusing human capital investments in the right places and in the right way. One of the major factors driving high People Equity is how the organization manages the numerous talent processes that support the overall talent lifecycle.
The complete talent lifecycle — all the stages in which the organization touches talent from attracting to retaining it — comprises a wide array of processes that when viewed holistically and through an ACE lens can typically be enhanced to yield higher returns on talent invested. Using the talent lifecycle during talent planning and execution helps reduce the chances of silo thinking and actions because it helps talent process managers — those engaged in hiring, recruiting, and onboarding, for example — see the overall talent goals and the interactions of the processes they own with other stages of the talent lifecycle.
Figure 9.1 provides a picture of the flow of talent into and out of the organization,1 connecting the available labor pools to the talent lifecycle to People Equity and organizational performance. While other factors such as technology or organizational structure will also influence People Equity, we know from our research and case studies that a major driver is the way we manage talent processes. Figure 9.1 acknowledges that an organization must work with the available talent pools for different job groups. If the talent pool is large, such as the number of people interested in a retail position during difficult economic conditions, the organization can be more selective, especially if its employer brand is attractive. If the talent pool is small, as is the case in many technical jobs today, the organization will need to work hard to find qualified talent to grow the pool, and it will be challenged to build a compelling brand that will attract more candidates.
Second, Figure 9.1 reminds us that various talent processes in the talent lifecycle must be designed and executed well. Effective management of the talent lifecycle will grow ACE, which in turn improves Organizational Performance.
Figure 9.1 Talent Flow and Business Performance
In Figure 9.2, we show each stage of the talent management lifecycle, beginning with finding talent through recovering lost talent. Each area will be addressed over the next three chapters. Talent is a renewable resource. When we think about the talent lifecycle, we think cradle to cradle — from finding new talent to recovering or “rebirthing” lost talent in the future. In the early cradle stages, our employer brand attracts (or repels) talent. If we are successful in attracting talent, we will have a sizeable talent pool from which to select skilled individuals who can thrive in our organization. Once we have selected them — and they have selected us — we need to accelerate their successful entry and acculturation into the organization. This process often entails training, such as onboarding orientation as well as training of technical, relational, or leadership skills, and embedding newly acquired talent into the organizational culture.
Once the new hires are on board and trained, we hope that our performance management systems will continue to develop highly productive contributors who remain with the organization for a favorable period of time. We must also not forget one of the top concerns of senior leadership — succession. Developing talent for leadership positions and roles with more responsibility is of vital interest.
The last part of the lifecycle — or the second cradle in sustainable talent — is recovering, rediscovering, or simply reusing departed employees. Smart organizations today think about their departing talent in new ways. They hope to rehire the best performers back someday, perhaps after they have roamed in allegedly greener pastures and found your organization to be worthy of return. At a minimum, we can at least work to leave a positive impression that will lead to good referrals and a positive employer brand image — spurring new talent into the initial talent acquisition stage.
The value of using an image of the complete lifecycle is that it forces us to think about high-level objectives we want the individual processes and activities to accomplish: high productivity driven by top performers, a steady stream of available talent to hire at the time of need, retention of exceptional talent, creating and supporting a desired culture, meeting internal and external customer expectations, mitigating risk by being good corporate citizens, and minimizing ethics problems. With the talent lifecycle in mind and using the ACE talent optimization lens, the remainder of the book will take us through the various talent management activities or processes and how we can significantly improve them.
We begin in the next chapter by looking at the talent acquisition components of the talent lifecycle.
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