Assignment #5- Sustainable Talent Management
Tracey D. Battle
Determine which performance management process you will employee to measure employee talent.
Although there are numerous performance management processes that can measure employee talent particularly in this day of computer technology. The most important parts of such a process is to ensure, the old phrase, “of having the right talent in the right roles at the right time is one of the most important issues facing line executives and human resource professionals today.” (Silzer & Church, 2009)
In order to ensure that this analogy, which is critical, remains true for any company they must continuously have mechanisms of feedback and then reviews of employees on a regular basis. Most companies would have employee reviews once a year, however, I believe that it is better for this to be done twice a year. There are companies that utilize just annual performance appraisal process by using the performance reviews that evaluate individuals with the potential to succeed in more complex or higher-level roles within the organization. This approach brings to light the question: does past performance realistically predict future performance especially in higher-level positions? Just a quick aside the Corporate Leadership Council defines a high potential employee is someone with the ability, engagement, and aspirations to rise to and succeed in more senior critical positions (Silzer & Dowell, Strategy-Driven Talent Management, 2010)?
Organizations and businesses utilize various techniques such as performance reviews, assessment centers, leadership style assessments and cross-organization project assignments in order to easily differentiate individuals with the potential of meeting the future needs of the organization or company (Silzer & Dowell, Strategy-Driven Talent Management, 2010).
In MailTime, which is the company that I discussed in assignment three, we utilized several means of measuring employees potential depending upon where the employee works and the level of the job they were doing. On the production floor, we utilized a very simple system of having a computer terminal (a screen and a keyboard) that was wired to the main computer that had full program on it. At these terminal screens, each employee had to enter, at the beginning of his or her starting a job, the job number and their initials. The computer would then automatically enter the start time and what they were doing for the job finally when they finish the job they entered a check under the finished column and the computer would automatically enter the completed time under the completed column. Because we have special software manufactured specifically for us, the information fed into the computer by the employees was then integrated with the main schedule thus, making it possible to see where any one job was in the production line in real-time. Further than just integrating with the primary schedule the information also went to another spreadsheet, which calculated the time it took the individual to do that particular job. Finally, at the end of each day, the spreadsheets would be totaled and various reports could then be produced from the computer. For example, if employee “A” on Monday did a job known as inserting and it was 5000 pieces and he took three hours then (subject to there being no additional note stating that there was some kind of a problem), the supervisor would be notified and would have to establish with the employee why this job took so long as the machines operate at 5000 pieces per hour. Additionally, again daily as well as weekly supervisors would be given reports that showed individual performances on the various different machines with each job function being totaled by the number of pieces and the number of hours taken. The data collected also included quantities run as each machine has a counter and the employees had to enter the final piece count that they had completed. Although this could obviously be fixed by the employee it would not take long to find out if this had happened either by the next person in line performing another function to the job or by the very final count that was applied to the postal paperwork this number was also entered onto the spreadsheet.
By remaining completely transparent and allowing the individual employees to see their performance information not only did this encourage individual improvements but also often the employees would challenge one another as to who would do the most work the following week. Therefore, this information had the benefit of encouraging faster and more accurate individual employees as well as assisting the supervisors in noting which employees performed consistently better than the others did and also which employees demonstrated being more helpful than others.
With respect to the supervisors of each area, we decided out of fairness to have quarterly reviews with these individuals. Because, of the computer programming that gave different reports when requested at the quarterly review the manager would have in front of him the reports relating to the specific area the supervisor works in. From these reports, the manager could easily advise the supervisor as to how he and his department was running on any one day, week, month, or totaling by a quarter. This would give the managers the ability to note any idiosyncrasies in the reports and ask the supervisor if there was an explanation, for example if the reports showed that he had one bad week in the entire quarter.
With these reports in hand at the monthly managers’ meetings each area of concern could be analyzed against other management figures thereby giving that information to the top management as to who would be the better candidate for internal promotions if the when they occurred.
Finally, it should be noted here that there is growing recognition of the need to develop leadership talent as early as possible which is given rise to “high potential” or “emerging leader” programs, in which promising talent is identified and cultivated to become the leaders of tomorrow. Not only does this ensure a strong pipeline to meet future needs it increases the engagement of the company’s most valuable employees (Stiles, 2006).
2. Analyze the key concepts related to talent pools and the talent review process.
In the Hewitt’s Human Capital Consulting paper, they state that there are five top workforce challenges, which are as follows:
1. Attracting and retaining skilled professional workers.
2. Developing manager capability.
3. Retaining high-performance.
4. Developing succession pool.
5. Addressing shortages of management or leadership talent.
The report goes on to state that in today’s uncertain economic environment, it is important that organizations address talent issues promptly, but it is equally important that they get them right-the first time (Hewitt Associates Human Capital Institute, 2008).
Based upon the Hewitt reports and research they feel that there has been considerable advance in the understanding and the need of talent pools in order to gain the competitive advantages as well as prerequisite for sustained financial success. From their research they feel that senior leaders recognize the superior talent has a business advantage the leaders understand the critical linkage between effective talent management and business success. There is an understanding that the top organizations have to expend increased energy and resources on talent related initiatives. As a result, there has been significant progress on various talent management fronts this includes from getting foundational programs in place to creating and deploying new programs such as a high potential development, leadership development, and succession planning. However, so far most of the progress is being made in the executive ranks with less focus beyond the highest management levels. This may well be where the initial key concepts of talent pools should start, however, it is critical that companies begin to move down through the management ranks to the line managers. Then on to the shop floor workers etc., there is further realization that the leadership must be involved in talent management as this is driven by the criticality of talent strategy development, articulation, and execution.
There is still much need for improvement as we are still not at a point of well-executed talent management programs that are aligned with business priorities. Organizations still lagging in their ability to integrate talent management programs and evaluate the return on the talent investment. The reasons are many and include the following:
Human capital is not sufficiently aligned with business strategy: although senior leaders recognize the importance of human capital there are still a number of companies struggling to connect their people practices with their business imperatives. From the Hewitt report they found that only 17% of respondents stated their workforce strategy is consistently aligned with their business strategy across the organization while even fewer 7% report consistently utilizing a specific quantitative framework in which investment in talent management are aligned with business results.
Lack of accountability and capability for talent development: Although the majority of organizations hold, their executives and managers accountable for achieving business results they are not being held accountable for talent development. Therefore, fewer organizations consistently hold managers or senior executives accountable for developing their direct reports. Perhaps more importantly most managers lack the basic capability to develop talent effectively just 5% of the organizations say their managers have the skills to grow people in their jobs or to provide the constructive feedback and supports and encourages employee development consistently across the organization.
Inconsistent execution and interrogation of talent programs: although the majority of companies report having fundamental processes for talent management in place. Very few consistently execute these programs across the entire organization. Although two thirds of companies say they do conduct workforce planning across all aspects of their business a frightening 1/5 do so consistently. Perhaps worse, still only 21% of companies consistently integrate talent practices across the organization. Put another way these companies are using the talent practices etc. for rewards tied to performance and or performance being tied to development.
Limited use of meaningful talent analytics: for many years now data and analysis have long played a role in driving business decisions, however, when it comes to talent analytics the majority of organizations have a long way to go. Mired by tracking traditional workforce measures such as headcounts, turnover, and cost-based metrics few have graduated to tracking the matrix that matter fewer than 10% of responding companies to the Hewitt report. Measure the effectiveness of talent management programs, track the quality of talent, we use specific quantitative frameworks to align human capital investment with their business strategy (Hewitt Associates Human Capital Institute, 2008).
Although we have just gone through a litany of what still needs to be done in companies to bring them up to par in their use of talent pools on the bright side there are the exceptions to these where companies have made significant strides in managing their talent. They are set apart from the rest by their dedication and commitment to talent management as well as the creative, comprehensive approach they take to developing their people in the following ways:
Depth of consistency of practices in other words talent management is given top priority at these companies. They have specific programs such as talent reviews and succession planning are institutionalized throughout the organization ensuring they are implemented and integrated consistently across businesses geographies and employee segments. These companies’ managers are taught how to develop the employees and talent programs are pushed deeper into the organization to reach a broader group of employees.
Higher commitment and accountability for development of talent: these companies have realized that the belief that talent management is solely an HR issue. These organizations realize it is a shared business and HR responsibility requiring active engagement, commitment, and accountability from leaders and managers. The CEO understands that the issue starts with him or her and works down they ensure that their business leaders not only emphasize the importance of talent management, but also actively engaged in the processes. Additionally, they hold themselves responsible and accountable in tangible ways for developing the next generation of talent across the entire organization not just at the leadership level.
Progressive and innovative practices: these companies operate from the perspective that they are never satisfied with the status quo, these organizations are consistently investing in new ways to manage talent. There are varieties of approaches to workforce planning, innovative employer branding strategies and efforts that are more comprehensive related to on boarding and developing. Some leading organizations are using sophisticated predictive analytics to help drive strategic human capital decisions and ensure that those decisions are aligned with the business strategy.
Although, the majority of organizations are still struggling to manage their talent effectively, a select few employers are leading the way. The companies that are struggling should be striving to find the successful companies and use them as role models to be able to build their own court talent management capability by holding leaders and managers accountable for talent initiatives, driving greater consistency in talent programs globally and continually seeking new and progressive ways to manage talent. The increased adoption of these approaches to talent management .2 and even legionary trend toward better practices overall (Hewitt Associates Human Capital Institute, 2008).
3. Develop appropriate talent management objectives to measure functional expertise.
Perhaps, in order to develop the objectives to measure functional expertise it might be better to start from the end and move forwards. Talent strategy must be tightly aligned with business strategy therefore effective talent management requires that your business goals and strategies drive the quality and quantity of the talent you need. Procter & Gamble, for example, views “business decisions and talent decisions as one.” In their research, the Aberdeen group showed that best in class organizations of 34% more likely to connect succession management strategies with organizational strategies. The organizations that apply the above statement holder, belief that business success hinges on having the right talent in place-at the right time. Companies that perform well are proactively addressing their talent needs. However, far too often, the connection between talent and business strategy is considered long after strategic plans are inked.
Talent management professionals need to move from the seat at the table to setting the table. Often when HR professionals go to different events and are asked who owns talent management more often than not they will point to either senior management or state senior management. Many HR directors have a seat at the table where they involved in discussions about business and leadership strategies that were previously held behind closed boardroom doors. Nevertheless, securing the rights to listen is not enough. Talent managers need to own parts of the process and service partners, guides and trusted advisors when it comes time to talk talent. Actually shows that this is no easy feat because in fact it looks as though neither HR nor senior leader managers are at the helm of talent management. Another recent report shows that when senior leadership are asked to rate the overall quality of HR. Only a quarter offered a very good or excellent rating and just 30% of CEOs viewed HR as a strategic partner. If talent management is a core part of any organization, it is essential that HR and senior leadership must work together. The most successful initiatives are driven by HR with active and enthusiastic support from the CEO and other senior leaders who provide the resources, the budget, the communication and support necessary for success. The reality is that the HR department and particularly the director or head of HR must become as well known and obnoxious as the marketing director. After all, there would be very few people in an organization who do not know who owns the marketing process and the same goes with finance etc. It is time therefore for HR to own and put in place professional talent management processes and must become a strategic part of the business.
The majority of studies show that companies with better financial performance are more likely to use competencies as the basis for succession management, external hiring, and inside promotions. Highlights include: the Aberdeen group found 53% of best in class companies have clearly defined competency models, compared to just 31% of other organizations that post less impressive performance. Aberdeen research also shows that best in class organizations are 45% or likely to have models the key positions and 64% more likely to have models for all levels of the organization and other organizations. Research from the Hewitt group illustrates the top global companies consistently apply their competency models across the organization, and the competencies are significantly more aligned with overall business strategies. 84% of top global companies demonstrated alignment, compared to just 53% of other organizations.
The power of competencies broadens when organizations use what we call “success profiles.” There are two reasons this approach is more effective than mere competency models. First and foremost, success profiles are designed to manage talent in relation to business objectives they should reflect key plans and priorities as well as change with new strategies additionally, they go be on the just competencies to include for complementary components: Competencies: a cluster of related behaviors that is associated with success or failure in a job. Personal Attributes: personal dispositions and motivations that relate to satisfaction, success or failure in a job. Knowledge: technical and all professional information associated with successful performance of job activities. Experience: educational and work achievements associated with successful performance of job activities. The result: detailed definitions of what is required for exceptional performance in a given role or job. Success profiles can be used across the entire spectrum of talent management activities-from hiring and performance management to development.
The talent pipeline is only as strong as its weakest link. Essentially, it is now the belief that talent management must encompass a far broader portion of the employee population. Value creation does not come from senior leadership alone. The ability of an organization to compete depends upon the performance of all its key talent and its ability to develop and promote that talent. A planned approach to transition is especially important as organizations place more emphasis on “growing their own leaders” rather than making often risky outside hires the bad news is that few organizations have proactive succession processes in place at lower leadership levels.
It is critical to realize that talent management is not a democracy just as the Bank of America has a philosophy, which states invest in the best. Many companies do the opposite, and make a mistake by trying to spread limited resources for development equally across employees. We found the organizations realize the best returns when promising individuals receive a differential focus when it comes to development dollars. These groups are most likely to return the most on any investment in their development.
It is important to understand the potential performance and readiness is not the same thing. Many organizations understand the idea of high potential pool or group of people who receive more developmental attention. However, sometimes they fail to consider the differences between potential, performance, and readiness. Organizations are not doing the work that is necessary. The global leadership forecast reports that only about half of the world’s organizations identify high potentials. Even fewer (39%) have programs to accelerate development. If organizations – like athletics – do not scale to the talent and then prepare individuals for top performance, how can you expect to have a winning team in the future?
Talent management as we have stated on other occasions is all about putting the right people in the right jobs this leads to a good question which is why should an organization placed a higher priority on selection rather than development? Not everything can be developed. Many elements of success profiles are impossible, or at least very difficult, to develop training people to improve their judgment, learning agility, adaptability. Are all core requirements for most of the talent hired today is difficult, if not impossible lack of motivation for a specific role or a poor fit between employees values those of the organization leads to poor performance and no classroom experience or learning activity will change this fundamental mismatch. However, you can guess it read on these areas during a well-designed hiring/promotion process. Hiring for the right skills is more efficient than developing those skills. What about the areas that are developable like interpersonal skills, decision-making, what technical skills? Assessing those areas at the time of hire is likely to cost less than developing them later.
Talent management is more about the “hows” than the “whats” for example organizations have many “whats” relative to talent management, including executive resource boards, software platforms, development plans, and training. These “whats” promise nothing on their own. Guarantees come from “hows” instead. There are five realization factors for sound execution: Communication this links the talent management initiative to the business drivers, puts forward a vision the organization can rally around and sets expectations for what will happen in the organization. Accountability its role is that of clarity so that individuals in the talent management initiative know what is expected of them. Skill: developing the right skills and providing coaches and mentors for support. Alignment is essential to align talent management initiatives to the business drivers but also need the right kinds of systems to identify high potentials to diagnose for development, to link to performance management, and to do development that really changes behavior. Measurement this comes down to the old saying you cannot manage what you cannot measure. It creates the tension, and objectives become clearer to help execute a talent strategy. The most effective measurements go beyond mere statistics to quantify what is working in talent management, why those initiatives are effective and what impact they have on the organization.
Software does not equal talent management. Claiming a piece of software can provide a full talent management system is rather like a food processor will produce a five-star meal. These tools are valuable in support of a good plan or recipe. The right tools clear the path for smoother execution and may improve the end product. The tools mean nothing without the right expertise and the right ingredients behind them (Wellins, Smith, & Erker, 2006 updated 2009).
4. Assess the key elements of global talent management as they apply to your organization.
In reality, MailTime has no global operations, either in selling or in purchasing, however, in part for the sake of this paper and in part because there are potential areas for expanding in a limited way globally. MailTime could if it desired move into the Canadian market of direct mail. To do so they would certainly need to search for a very knowledgeable Canadian mail operator their first hire would be that of a Canadian data specialist and mailing specialist. As it would be critical to have the knowledge of the Canadian postal system as we do that of the US postal system. Once this individual was on board then the company could immediately start to mail directly into Canada with a few clients in the United States who have consistently asked if MailTime can mail into Canada. There are customs and import duties and therefore, either the Canadian postal expert or someone from the US would have to investigate the paperwork as well as the transportation logistics that are involved in taking Canadian mail across the US Canadian border. Once these logistical issues are resolved, then mailing could start immediately with the clients stated above and at this point, it would serve MailTime well to employ a sales representative in Canada. Preferably looking for someone who already has what is known as a book of clients that he or she has already been dealing with. In the US, there may be, need for an additional data/mailing operator as obviously both the rates and the paperwork will be different. Further, in the US the production manager will have to develop a system whereby his operators can easily distinguish between US mail and Canadian mail to ensure that there is no mixing of the term when they are being palletized to go to the post office or the Canadian shipper. Obviously, as and when the Canadian side of the business group then the company would have to employ individuals on both sides of the border depending upon their needs. If it grew sufficiently then there would be logic in having one line specifically set up for the Canadian market. This would have its own employees, supervisor, management team etc.
If the Canadian market worked out well for MailTime then in theory, they would be nothing stopping them thinking about expanding into South America. Obviously, each country has its own postal systems and rates so they would have to do a replication of what they did moving into Canada for each South American country they decided to move. How far they could move south is difficult to say because it will depend upon the type of direct mail that is sold in the other countries. If it is as time sensitive as in the United States with as little time given by the clients then there would be little room for MailTime to move into such countries as obviously they are going to be slower just as a result of transportation time when companies already existing in these southern countries.
5. Recommend a process that optimizes a sustainable talent management process.
In order to have a process optimizes a sustainable talent management process it is got to come from the top and the works in conjunction with the HR department who should be in the driving seat if not the least the co-driver with the CEO. Critically it must cover all key positions in its succession management strategy from top to bottom and bottom to top. Some of these positions are highly technical, individual contributor roles. In these cases, it is necessary for successful companies to emulate Boeing HP and Qualcomm where they have highly developed innovative and technically expert engineers. Energy companies are highly dependent on their petroleum engineers who trained for seven years to reach a high level of competency. Including these highly skilled individuals in the succession management process even if they do not end up in a management role is a key best practice. While more than 60% of the company’s indicate that they have a process for identifying key roles, often times the succession management is too narrowly focused on the development of managerial leaders versus highly skilled technical roles.
For effective succession, management there has to be a strong talent review process. The best succession management companies integrate three key attributes into their talent review process. Just doing these free things with at least allows your organization to receive a higher return from the talent reviews than most companies do. Firstly, Process Integrity this refers to the consistency of the process and the quality and reliability of talent data. A little more than half of the companies surveyed have an enterprise wide program that is centrally managed. The way in which the program is governed and implemented can easily have an impact on the program’s integrity. Secondly Talent Review Attendance appropriate line of business and the HR leaders must participate in talent review meetings only 25% of companies believe that the right attendees at present at all of their talent reviews finally Business Strategy Alignment discussions must continuously refer back to the positions and capabilities that are necessary for driving the business strategy. In this case, only 40% of companies align succession planning with strategic business planning process. If there is not business strategy alignment then the talent review process will just be considered as an HR exercise, rather than a key business driver for achieving results. Talent calibration, Board of Directors involvement a clearly defined criteria for high potentials are all best practices that should be continuously explored in more depth by the HR team.
There is no doubt that could succession management is clearly correlated to business success. We have seen time and again that best practice organizations are three times more effective at achieving key business measures. In report after report companies with succession, management strategies realized vastly higher returns in a number of areas. Firstly for example 65% of companies at level 3 maturity (according to the Bersin & Associates report) are “effective” or “very effective” at driving improved business results through leadership skills and behaviors versus 6% at level 1. This organization followed a list of deliverables in the high impact succession management reports and classifies a five-stage maturity model with comparisons between companies that hire and lower levels. Secondly 73% of companies at level 3 maturity are “effective” or “very effective” at increasing the quality and bench strength of the company’s leadership pipeline versus only 21% at level 1. Thirdly 62% of companies at level III are “effective” or “very effective” at accelerating change and business growth versus 12% at level 1.
Just for the purpose of clarification and understanding the report classifies different companies within five maturity groups a zero level would mean that the company has no real succession management process in place as of yet the research shows that 21% of companies are at this stage. A level 1 replacement planning at this maturity the company focuses on senior level positions otherwise known as the A list of high potentials is created but there is no formal development process in place at this level the research shows that 15% of organizations function at this level. Act level 2 traditional succession planning is occurring where the organization implements succession planning by targeting critical senior-level positions. In other words, talent reviews are conducted and plans are developed should it be necessary to put them in place. At this point of maturity, the research shows 52% of organizations operate at this level. Level 3 is where the company integrates succession management the company’s target all critical positions at all levels. Companywide succession is tightly aligned with the business strategy and integrated with other talent management processes. At this point of maturity, there are 12% of companies achieving level 3. Level 4 is the “next practice” of succession management according to the Bersin & Associates there are no companies that have achieved this level of maturity. In order to achieve this level of maturity companies must completely understand capabilities and potential of their workforces; talent decisions are made naturally, based on what is best for the business as a whole. For the benefit of clarification this report and thus the research substantiating it was carried out prior to April 2009 (Lamoureux, Campbell, & Roland, 2009).
Obviously, whether or not the Bersin report is even mildly accurate it is quite clear from all other research that the majority of companies have an opportunity to improve their succession management programs. As agreed by both HR leaders and executives the challenge for succession management is developing a succession planning strategy. Should a company wish to start down the road of succession planning and creating sustainable talent management processes etc.? They just need to do a simple research through Google, they will find a plethora of companies, and consultants that can help them plan and carry out a full talent management including reviews.
Finally, with the validation of the data even small companies should be looking at talent management and particularly the reviews that go by the wayside because of being too busy. However, if these companies would only take the time necessary for reviews and performance measurements they could make the companies not only more efficient and critically more able to survive a major player leaving.
Hewitt Associates Human Capital Institute. (2008). The State of Talent Management Today’s Challenges, Tomorrow’s Opportunities. Chicago: Hewitt Associates.
Lamoureux, K., Campbell, M., & Roland, S. (2009). High-Impact Succession Management. Bersin & Associates and Center for creative leadership.
Silzer, R., & Church, A. H. (2009). The Pearls and Perils of Identifying Potential. Industrial and Organizational Psychology Perspectives on Science And Practice.
Silzer, R., & Dowell, B. E. (2010). Strategy-Driven Talent Management. San Francisco: Jossey-Bass.
Stiles, P. e. (2006). Best practices and key themes in the global human resource management: Project report. Sanyo Corporation, 10 to 12.
Wellins, R. S., Smith, A. B., & Erker, S. (2006 updated 2009). Nine Best Practices For Effective Talent Management. Development Dimensions International, Inc.