Talent and Talent Management

Farah Waheed, Manager of Recruitment and Assessment Services

What is it? Why is it needed? How best to implement?

The Oxford Dictionary describes ‘Talent’ as Natural Ability, Special aptitude or faculty. As part of the ongoing drive to improve bottom line figures, employing and retaining ‘talented’ staff seems an obvious thing to do. Successfully managing this process is easier said than done.

It has been over a decade since McKinsey published his “War on Talent” survey revealing that companies with a high proportion of “talent” on their payroll averaged a 9% greater return to shareholders versus those without. However, it has only really been in the past four years or so that we have witnessed a noticeable surge of Talent Management Programmes. Now the term “Talent Management” sounds almost clichéd.

The current focus on launching these programmes has come from recognition of the fact that identifying, developing and retaining talent within organisations will ensure that the right people are taking that business forward and have the right skills, behaviours and aptitude to secure a successful future. This next generation of leaders are those currently considered as having “high potential” or “talent”.

The importance of both identification and retention is emphasised when you consider that more than 37% of senior HR managers see employee retention as the biggest challenge in 2007. This concern reflects the change in the nature of the psychological contract between the organisation and the individual. No longer is there a widespread view of a “job for life”. Companies now more than ever are facing issues of staff retention and recruitment. The importance of harnessing, identifying and nurturing talent has never been more crucial.

So What is Talent Management?

Some elements of “Talent Management” are already inherent in appraisals, development programmes and succession planning. However, what organisations are now looking for is an overarching model of Talent Management i.e., a system or process that enables them to identify, develop, nurture and retain those individuals with talent. This is a growing need as revealed by the CIPD’s learning and development survey in which 74% of respondents believed their organisation did not have a well-developed action plan for Talent Management.

As a consequence there is increasing focus on the systems and tools that support Talent Management. This includes:

• Definition of what talent actually means for the business in question – what are the qualities and skills required and what is the relationship between these qualities and skills and the future aspirations of the company? What are the future conditions in which these skills will be expressed?

• Identifying talent – whatever method is chosen it will need to be as objective, robust, fair and transparent as possible. It will also be important to recognise that there is a distinction between individuals with high potential and individuals who are high performing. You could have an individual whose performance data suggests that they are performing very well in their role. However, this does not automatically mean that they have the necessary skills and behaviours that will enable them to be an effective leader of the future. Indeed, the performance data may not reveal the additional skill sets and behaviours of an individual with high potential thus rendering this information less useful as a means of identifying talent.

Issues around Talent Management

The section above describes defining, identifying, utilising & engaging, relating and evaluating as the general process which surrounds the implementation of most Talent Management models. There are already a number of lessons to be learnt regarding some aspects of the process.

For example, regarding defining and identifying it would appear from the emergence of elaborate competency frameworks that organisations are getting bogged down with overly complicated competencies which describe what excellent performance looks like but don’t necessarily describe the critical and essential behaviours required of a future leader. This means that organisations are re-hashing their existing competency frameworks which are used for development and performance. The impact of this is a competency framework that isn’t useful for identifying talent.

Clearly, an effective competency model will be one that distinguishes individuals with potential and as such the evaluation of the entire process will be essential in determining the effectiveness of the overall process. However, even before the evaluation, clear links need to be made between the competencies and the overall business strategy.

Indeed, the importance of the relating and integration of the Talent Management programme is absolutely essential. There will need to be clear links from the business strategy through to succession planning and into the development through the whole TM cycle to make this work effectively. If the Talent Management programme does not fit in with the other pieces of the jig saw then the purpose of the programme and subsequent impact to the business will be lost.

In terms of utilising & engaging talent, whilst some talent management programmes are implemented purely as a means for individuals to “get to the top” it is becoming increasingly recognised and accepted that talent management is not just about upward career moves and that moving horizontally can broaden an individual’s experience. Individuals will be needed who not only can lead but can take on larger and different jobs across the organisation.

Dealing with resistance

As with most new initiatives, there has already been resistance to the launch of Talent Management programmes and this resistance has usually stemmed from differences in people’s understanding and interpretation of what “talent” means within their respective business. As with the implementation of competencies, leadership development programmes and coaching, it will be essential to engage with key stakeholders and gain their acceptance of the new Talent Management initiatives. This needs to happen at the very beginning and throughout the process and can be in part achieved through a clear communication strategy to all the relevant groups.

Lastly, those individuals who aren’t identified as having “talent” or “high potential” may end up feeling demoralised. Inadvertently, the potential backlash of the implementation of TM initiatives is the deterioration in motivation or potential loss of individuals who have left because they feel that the organisation does not value them. If they haven’t got high potential does this mean they have low potential? If they do not have talent then what do they have? It will be important to carefully manage the communication process in this instance and the development of individuals who don’t “make it” onto the programme.

To conclude

There is certainly no single solution to an effective Talent Management programme and it seems unlikely that there will be a “one size” fits all approach given that any TM system will need to be aligned to that organisation’s culture and values. As consultants where we add value is through adopting an external and objective perspective on your business and assisting you with the methodologies and approaches in defining, identifying, utilising, relating and evaluating your TM system.