Talent management is vital to the success of an organisation, despite the fact that companies face cutting back their workforce or prioritising cost control. People development expert Linda Sharkey explains to Jim Banks how managing talent is a strategy that CEOs cannot afford to ignore.
The global downturn is dominating the headlines, with business news more likely to focus on unemployment than on the war for talent. However, this only masks the fact that developing the best and brightest talent is still a big challenge for any company with a long-term business plan.
Regardless of the changes caused by the shrinking global economy, the importance of hiring and developing the right leaders for a business remains undiminished.
An important weapon in the war for talent is the ability to offer personal development, not only because of its appeal to candidates, but because it clearly demonstrates a company's values and ambitions. A commitment by a company to develop its talent sends a strong message that it is its people who turn strategic goals into realities.
"Performance management and talent management are organisational processes; they are not the domain of HR. For effective personal development programmes, you need to understand your business strategy and the capability related to it," says people development expert Linda Sharkey, who has worked for GE Capital and Hewlett Packard.
"Skills are just a part of the equation. You need to understand the culture of an organisation and how things get done. Be clear about what is valued at the company," she explains.
This focus, she believes, is essential if a business wants to truly understand its skills and leadership needs. Payback from talent development demands a clear, systematic approach as well as a common language throughout the business. Improving communication within the business was a clear imperative during Sharkey’s time at GE Capital, where she headed organisational development and executive staffing. During her time, the company successfully developed a single framework on which every aspect of people development was included.
Know where you are going, know where you are
Sharkey believes that any talent management strategy begins with mapping out the qualities of key executives and employees. This may sound like a daunting task to some, but the data needed to develop a strategic approach to talent development already exists within every organisation, it just needs to be harnessed.
"You can see the development gaps and implement a solution that is consistent across the whole organisation. Get to know the gaps and learn the profiles of the best people you have. There is enough quantitative information about talent to drive business transformation and derive real value," she remarks.
Once the mechanisms are in place for gathering and analysing this data it is possible to define metrics that can measure the performance of talent management efforts against a company’s strategic goals.
"You need to look beyond whether someone achieved what they set out to do," says Sharkey. "You need to look at whether they exceeded their goals, whether they were cost-effective or improved productivity. Do they have a high attrition rate? If so, is that a negative thing, or a positive sign that they are developing individuals who are then moving on to face the next challenge?"
Tailoring metrics to reflect what a company really wants to know about its people and their performance enables a business to get more value from employee surveys, for example, which can examine how well managers engage with their staff, rather than simply canvassing views on employee satisfaction. This provides a better insight into the quality of individual managers and how best their development needs might be met.
Given the difference in strategy between organisations and the many ways in which the strategic impact of talent development is managed and monitored, it is no surprise that every company must take a unique approach. "There is no cookie cutter. Understand the layout of your company and its business strategy, then take the tools and adapt them to your needs," says Sharkey.
Change begins with talent
The challenges posed by today’s economic climate only serve to highlight the need for many companies to transform their business models and organisational structure. Achieving this transformation successfully largely depends on placing the right leaders in the right places in the business model. Talent is fundamental to change.
"It is important to develop a consistent operating rhythm so that you don’t water down change when people protest. Your plan must be well thought out, but you also need the fortitude to persist. It takes at least three years to significantly change an organisation, so don’t let talent reviews slip, stay willing to step up to the pressures you face, and make sure you get your leaders on board," stresses Sharkey.
However, the right strategy can also limit the overall need to hire externally, as leaders are developed from within. This not only saves time and recruitment spend, but provides candidates who are already part of the company’s culture and who understand its strategic goals.
"Know your talent capability and what you need in the recruitment market, and have a long-term plan in mind when you hire. Balancing short-term and long-term needs is always a dilemma for people in positions of leadership because you have to win the battles and the war," says Sharkey.
She also points out that the senior executives who shape corporate strategy and, therefore, define their organisations’ talent needs, cannot afford to neglect their own professional and personal development.
"The higher people get in an organisation the more they get caught up in their job and the less they work on their own personal development. People look up to the leaders at the level above them to take their cues on corporate values and priorities. They get these cues from watching their leaders and seeing what they do, so managers must understand this and continue their own development," she says.
Development programmes at a senior level are different to the kind of training needed by people lower down the organisational ladder.
"A big part of senior development is about personal reflection to understand how their messages come across. It cannot be a training programme. It must be based around discussions that bring together short-term objectives and strategy. Above all, the CEO has to drive it," says Sharkey.
"It is better to get the alignment of talent management and corporate strategy right first and then cascade it through the organisation. Everyone learns from their leaders."