It all starts with a talent management strategy (Sherry Fox for Technology Evaluation Centers)
People are the most important resource in our global economy. And whether or not companies are willing to admit it, their employees make the difference to their bottom line. To remain competitive, employers need to know what their employees are doing, what skills they have, how they're developing, and how they fit into the business today and in the future. One way to do this is with talent management. Companies need to assess how managing their talent fits into the overall business strategy.
What is talent management?Talent management generally is the process of attracting highly-skilled workers, integrating new workers, and developing and retaining current workers to meet current and future business objectives. But talent management has additional meanings to different organizations: For some it’s about finding and developing top talent; for others it’s about the overall management of all workers, highly skilled or not, within the organization.
Before embarking upon a talent management initiative, it’s important to understand what you hope to gain from integrating talent management within your organization. For this, you need to take a step back and look at HR.
The changing face of HRFrom an administrative perspective, the human resource management (HRM) function includes a variety of activities, but it's mainly responsible for the human resources, the people making up the organization. This includes determining staffing needs, recruiting and training the highest-skilled employees, addressing performance issues, and ensuring that personnel and management practices conform to compliance regulations.
The HRM function has undergone tremendous changes over the past 20 to 30 years. In the 1970s and 1980s, the personnel department was charged with managing the paperwork around hiring and paying people. In the 1990s, however, organizations began to see the HR department as playing a major role in staffing, training, and helping manage employees, so that they and the organization could perform at their maximum potential. Through this process, the concepts of strategic HR and talent management emerged. Today talent management is an established HR function across many large and medium-sized companies.
From a technology perspective, talent management differs greatly from traditional HR. While the HR role itself has changed over the years, so too have the systems used to manage people. However, just because you have an HR department and you’ve purchased an HR system, that doesn’t mean you’re managing your talent. While some HR systems have added different talent capabilities, many options are available, making the process of deciding on which one best fits your company’s needs rather difficult. Knowing which one is right for your business has as much to do with your talent strategy as it does the type of features and functions you will need from a software system to manage your people processes.
It all starts with a talent management strategyRecruiting and retaining top talent should be the number one priority for your talent management strategy. However, properly managing human capital is still a big challenge for many organizations. Technology Evaluation Centers (TEC) conducted a poll that asked readers, “What has been your biggest roadblock in effectively managing your talent?” It yielded these answers:
- 47% didn’t have the right people and/or technology in place to make it work
- 33% lacked executive buy-in to implement an effective talent management strategy
- 13% were told that their current HR system and processes were enough
- 7% didn’t have any roadblocks and were managing their people just fine
While the largest number of respondents cited not having the right people and/or technology in place, it appears that HR professionals are faced with the pressing challenge of developing an innovative strategy that will meet their current business demands and that their executives will buy into. It’s important to focus on innovative and creative strategies that will attract and retain the talent needed to meet the needs of the organization today and for the future.
These are some elements of a solid talent management strategy:
Adopting a culture of talent within your company: being willing to invest in your people from the beginning and throughout the employee lifecycle, and having a sustainable approach toward talent management, even in an economic downturn
Understanding the business: clearly understanding your organization’s current and future business strategies and where people fit into that strategy
Investment in people: having the necessary people in place, including those who will be involved in implementing the software, to establish your strategy
Continued process improvements: providing training and conducting performance assessments as part of an ongoing process toward strategy improvement
Readiness quiz: What’s your talent management IQ?If any of the above elements don’t fit in with your company’s philosophy, you’re probably not ready for talent management, or even talent management software. But just to be certain, take this quick quiz to see how ready your organization is to properly manage its human capital.
- Does your organization have a talent management strategy in place?
- Is your talent management strategy aligned with your organization’s mission and goals?
- Do you know which measures can make your talent management strategy more effective?
- Are your employees engaged within the organization through the use of surveys?
- Do you know your organization’s workforce demographics?
- Can you easily determine which employees may pose a flight risk?
- Do you have a succession plan in place?
- Can you readily determine the training needs of your employees?
If you answered “no” to any of these questions, take a closer look at your talent management initiative. You may have a deficiency in the information systems you’re using to monitor and analyze employee data. If you are a medium-to-large organization doing business globally, your people initiatives may be in serious trouble.
If you answered “yes” to some of the questions, your organization somewhat has a grasp on managing human capital but should look to further strengthen processes. You may have adequate people management systems in place but are probably not using them to their full potential.
If you answered “yes” to all of the questions, chances are your talent strategy is properly aligned with your overall business goals, your talent management or related HR management system is being used to its full capabilities, and your organization is successfully managing its talent.
Technology: too much, too soonWhether you’re a small company with fewer than 50 employees or a medium-to-large firm, there’s a place for talent management in your organization. But the decision to buy a talent management solution, as when making any large software purchase, should be based on your talent management readiness, company size, and considerations of the current software systems.
Talent management software is usually offered in modules, which make up a suite. Many talent management and human capital management (HCM) software providers offer their solutions this way, allowing their clients to pick and choose the modules they would like to start with. It’s important, however, to choose modules in line with your talent management strategy.
Some studies have shown that many companies are not maximizing their talent management investments to best suit their needs, thus impeding their success.
ConclusionSkilled and talented employees are hard to recruit and retain within any organization. Retaining such people is particularly challenging for small businesses competing on unequal footing with larger firms offering better compensation packages.
Talent management is not just about finding the right candidate for the job. That individual must be nurtured and given ample opportunity to develop and grow with the company. Companies that neglect to manage their talent effectively end up losing key talent.
Before jumping on the talent management technology bandwagon, you need to assess whether your organization is ready to embark upon such an initiative. If your organization does not have a well-defined talent management strategy in place or still manages its businesses processes with several disparate software systems, then a talent management system will probably end up hampering your business activities more than anything else.
But if your organization has a well-defined and structured initiative for managing talent, now and for the future, it is ready to take advantage of technology to streamline its talent management processes. Software systems can provide the necessary functionality for recruiting, managing, and developing key employees. When this is aligned with the overall business strategy, it ensures the growth and success of the organization.
Excerpted from When Is Talent Management Really Right for Your Business? by Sherry Fox and reprinted with the permission of Technology Evaluation Centers (TEC). TEC helps companies research, evaluate, and select the best enterprise software solutions for their needs. To learn more, visit http://www.technologyevaluation.com.