PRICE WATER HOUSE COOPERS
With all of the hype surrounding the topic of talent management it has become increasingly difficult to understand exactly what it means, and more importantly, whether there is something more that we should be doing in our organisations.
As the baby-boom generation retires, the size of our labour pool continues to diminish. This is a global phenomenon and is especially true in Asia. This means that it has become increasingly difficult to attract and recruit people.
At the same time, organisations have become more sophisticated in their understanding of talent requirements.
Where CEOs once spoke about "people" being their organisations' greatest asset, they now specifically refer to "the right people" being their greatest assets. We have learned that it is no longer good enough to recruit skilled people. Instead, we need to be sure that those skilled people will also be a good "cultural" fit for the organisation.
Therefore, it follows that someone who is regarded as "talent" by one organisation may not be considered as such by another. It is one thing to have people who can do a job, but if they are not motivated and happy, they are unlikely to be doing everything they can to help the organisation achieve its goals.
We are defining talent management as the strategic management of the supply of talent through an organisation. Its purpose is to ensure that there is an adequate supply of talent to align the right people with the right jobs at the right time based on strategic business objectives. Therefore, the business strategy should always be the starting point for developing an effective talent management strategy. Organisations should start here, and then look for people, both internally and externally, who have the requisite knowledge, skills and shared values to drive success.
Knowing "what" the organisation needs to do (strategic objectives) and "how" it needs to achieve this (culture) tells us a lot about how to identify talent in a particular organisation.
When it comes to the question of whether it is better to develop people internally or recruit externally, the correct answer usually involves a mix of both approaches. It generally takes longer to develop people internally, but it is often expensive to recruit externally and a "good fit" is not guaranteed.
With shrinking talent pools, organisations need to sell themselves to the candidate. This approach is in stark contrast to the past when candidates had to do everything in their power to sell themselves at the interview. Organisations are finding that they need to include senior management in interviews and spend quality time with candidates discussing and selling the organisation's strategy, culture, development programmes, career paths and reward systems.
Organisations are becoming acutely aware of the need to develop people. However, with increasing pressure to control costs it is critical to ensure that valuable training and development resources are aligned with and prioritised according to the business strategy. It follows then, that these resources should focus on developing talent.
While it is becoming increasingly difficult to attract talent, it is critical that organisations do not fall victim to "brain drain" and do all in their power to retain critical talent. It is largely due to this reason that we have found organisations often seeking help in developing best practice talent management programmes.
Recognition and reward mechanisms should be crafted and aligned such that they motivate and guide people to deliver the organisation's strategic objectives. Financial rewards usually consist of fixed compensation and now organisations are doing more to include variable, performance-related incentives and bonuses in their packages.
However, recognition and rewards are not limited to financial or monetary measures. Research tells us that people bounce out of bed in the morning and go to work to enjoy challenging assignments, collaborative teamwork, good working environments and stimulating engagement with management. Organisations will do well to identify and understand specifically what different groups of people value and design their recognition and reward programmes to meet these needs.
While all the components we have discussed should be present in any organisation, some companies spend more time and focussed effort in doing it right. An effective talent management process ensures that all components are crafted and aligned to attract, develop and retain the people responsible for the organisation achieving its strategic objectives.
In this sense, talent management is not so much about whether an organisation is doing it, but rather, how consciously it is doing it. It is just as much a mindset as it is a process and what often distinguishes one company from another is the extent to which this proposition is properly understood and actively sponsored and championed throughout the organisation.
Stephen J. Camilleri is an Associate Director in the Advisory practice of PricewaterhouseCoopers Mekong, which comprises of offices in Thailand, Vietnam, Cambodia and Laos. We welcome your comments at firstname.lastname@example.org