A recovery from the deep U.S. economic recession has reopened the wound of the talent shortage.  Companies are seeing the repercussions of having not managed talent and rewards effectively in the downturn and now their high performers are looking for better opportunities at companies that not only have a successful brand and business model, but also have a modern talent strategy that supports them as a professional and across teams and the broader enterprise.

 
Even during and after the recession, the rise of unemployment rates are not reflective of the skilled professional talent pool.  There was actually a continued shortage of skilled professional talent globally at the nadir of the 2009 recession.   So what’s going on? Demographics are changing with the retirement of the baby-boomer generation that will continue to have a significant impact on those organizations that have not planned for succession and knowledge and skills transfer.  Newer generations entering the workforce have an entirely different view of work and it has become evermore challenging to effectively retain and manage talent and teams across generations.  The expanding realm of global business is creating new competency requirements, especially in leadership, that continues to shallow the qualified talent pool.
 
Emerging markets and industries are experiencing an even greater shortage of top talent.  For example, the energy and technology sectors are not seeing the needed output from U.S. universities or from within the experienced hire talent pool.  Furthermore, restrictive immigration policies are making it difficult for US businesses to import hires from abroad.  Studies show that leaders are admitting to not devoting enough time to talent as a business imperative including the development of future leaders who will succeed them.
 
Companies are struggling to adapt to these changes and challenges fast enough to get ahead of the curve.  Outdated perspectives, methods, processes and systems in how to engage and optimize talent are stagnating culture and growth and are having an impact on the quality of talent businesses are able to recruit and retain.  This is best demonstrated through the Millennial Generation who expect companies to align with their view on corporate responsibility, diversity, sustainability, and other social issues.  They are much less interested in companies who don’t already have these programs in place.  They seek an employer that offers career opportunities with expedited growth, work diversity, professional development and flexibility to provide balance with their personal life.  Sometimes referred to as the “Trophy Generation”, where everyone is a winner, Millennials expect to be cared for in the context of training, mentorship, and provided a faster track in terms of responsibility.  They are also not loyal to companies who fail to meet their expectations.  Quite different from the Baby Boomer generation.  How is your company positioned to recruit, assess, manage and retain the best talent across generations?
 
In 2012, more than half of CEO’s of leading global organizations continue to cite talent strategy as one of their top concerns and are looking to effective succession management, leadership development, geography and role mobility, and diversity as a means to building talent1.   The better companies are moving their talent identification programs into high schools to foster relationships, mentor motivated students to pursue in-demand careers and ultimately develop them into future leaders.
 
Good companies integrate risk management as a driver of business performance.  Hiring the right talent, and conversely the wrong talent, has huge implications on risk exposure relative to cost, brand/reputation and, in the worst scenario, to the business as a going-concern.  As companies evaluate any investment decision, there is an in-depth diligence process to understand if the investment is feasible, sustainable and will provide a return on investment.  During the assessment of a business acquisition target, talent tends to be an outlier amongst the core functional areas evaluated during diligence exercises.  Talent, in and of itself, is arguably the most important investment for any business.
 
To get the talent equation right, business leaders have to first make talent a priority item on their agenda.  It cannot be some task handed off to human resources in the hopes that somehow it is worked into the business model.  It IS the business model.  The best companies starts by aligning talent with business strategy and objectives to define a high performance culture and then align rewards and accountabilities to the achievement of this culture.  A culture of high performing talent not only achieves business results but also attracts, assesses and retains other high performers.  A high performance company has world-class performance management, employee engagement, training, leadership development, and succession management giving them a competitive advantage to retain top talent.  As importantly, it gives business leaders the metrics on the effectiveness of their talent program in meeting, and hopefully exceeding, business objectives.
 
Business leaders who champion talent as a business imperative
> take a well researched view to the market, keeping track of competitor data and continuously pipelining high performing talent so they are prepared to move quickly when they do have to go to the external market to fulfill immediate business needs
> create best-in-class recruitment processes and enable those processes with the right technology
> invest in creating a candidate experience that defines and enhances their brand
> customize talent assessment methods and tools to holistically measure and select the right talent to achieve specific measurable objectives
> formalize training and rewards to build and enhance a high performance talent culture
 
Know that top candidates are assessing your brand from the moment you first reach out to them throughout their first 6 months to 1 year post-hire.  A broken recruitment process cannot only damage your brand (bad news travels faster than good news) but can further shallow the pool of available talent.  Hiring the wrong talent can have significant monetary costs in addition to business disruption and missed opportunities.  When you take broad view to the vision, mission, strategy, objectives, and values of your organization, the alignment of talent quickly surfaces as a critical success factor.  Having the tools to set talent strategy; research the market; recruit and assess top talent; successfully on-board and integrate and; retain, develop and measure high performers sets the best business leaders apart from their peers.  In today’s business environment, talent management is not a nice-to-have priority but an essential component of being a competitive and sustainable enterprise.
 
 
_______
David Perel is a Talent Acquisition Leader based in Chicago, IL
 
1 Source:PwC 16th Annual Global CEO Survey (2013)
 

Views: 112

Comment by Stephen Smith on May 23, 2013 at 4:02am

I'd be interested to hear the authors thoughts on whether he perceives this as an issue of equal prominence across all industries.

My own view is that in recruitment, this issue is somewhat diluted by the fact that high performing candidates use a relatively higher volume of softer skills, rendering them more dispensable than those with a degree level education.

I concede that a top performing software developer who's particularly jaded may be harder to replace, but surely recruitment consultants are a dime a dozen. The only true areas of differentiation they possess are work ethic and clients they can bring with them after they jump.

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