By Peter Cheese
Today, more than ever, businesses all over the world realize the importance of their people to long-term success. But few believe that their organizations are able to make an adequate response to the growing challenges of workforce demographics and global economic change. This situation is further complicated in today's multi-polar world, in which organizations in developed and emerging economies are competing, often as equals, throughout the world for the same assets and resources—including talent. An executive issues survey released by Accenture at the 2008 World Economic Forum in Davos, Switzerland, found that issues around talent dominated the thoughts of senior executives at some of the world's largest companies. Indeed, more than two-thirds of the 867 executives surveyed rated the problem of attracting and retaining talent as a key threat to business success, second only to competition.
By talent, we mean all of the human skills and capabilities needed to sustain business performance and growth. The vital contribution of the workforce has been heightened by the global economic turbulence of the past year, which has brought uncontrollable change to so many other factors of production. Against a background of rising energy and raw material prices, anxious and stricken capital markets and sharp plunges in land, housing and other fixed asset values, it is more important than ever that businesses make the best possible use of the factor of production which they are best equipped to influence—the combined talent of their people.
Although the issue has grabbed fewer headlines than the credit crunch and other crises, there have been dramatic developments in the market for talent. Within the multi-polar world, characterized by expanding diversity and change, every organization needs to deal with many pressing talent-driven issues. These include: global abundance but local scarcity of talent; an aging workforce; the rising demand for new skills; new work arrangements and career expectations; a more diverse and distributed workforce; and ongoing shifts in the nature of work. These changes are quickly driving talent to the top of every business leader's strategic agenda. The underlying fact is that, in today's business world, the key to strategic success is talent—but talent is harder to find and nurture than ever before, and easier to waste and lose.
Organizations will not succeed in meeting these challenges unless they handle talent issues strategically. They cannot afford to park them in specialist functions and regulate them by specialist processes, however well designed. They need a holistic approach, in which every part of an organization is connected and animated by the need to discover, develop and deploy talent to the greatest effect. That in turn requires the building of engagement in every part of the organization—the willingness of people to align and maximize their talents and energies to fulfill corporate objectives.
Unfortunately, few organizations today are managing talent strategically. To do this, they need to understand the talent imperatives aligned with their own business strategies in both the short and long term, and take a strategic approach to meeting these imperatives.
The first of these—the discovery of talent—demands that organizations be constantly aware of the best sources of talent and how best to access them. With once-familiar talent pools drying up and new ones rapidly coming up stream, organizations have to move fast and act smart if they are to attract, motivate and keep the people they need. Talent sourcing has become a particularly critical issue in many businesses as they grow and require new skills, and as they see their existing workforces aging. Attracting and managing much more diverse talent—diverse generationally, geographically, educationally and culturally—is becoming a critical capability that organizations and their HR functions need to acquire and constantly renew. But this also means thinking realistically about alternative sourcing approaches to access talent.
To meet the other imperatives—the development and deployment of talent—businesses need to have integrated talent management processes that work effectively across their organization, but also recognize the diverse segments of the workforce. Employee value propositions need to be targeted to potential recruits, and delivered consistently to current employees. Crucially, line managers need to be much better equipped and trained to manage their people, as well as play their role in multiplying talent and building engagement.
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