Everybody's looking for it. David Smith has turned the Talent & Organization Performance Practice into Accenture's largest consulting practice. How?
David Smith, managing director of Accenture's Talent & Organization Performance Practice, took the reins in September 2009. While that may seem like a terrible time to take over any business, the practice has taken off under Smith. It is now the largest management consulting practice at Accenture, serving more than 400 clients and half of the Global 100. Smith couldn't share specific revenue figures, but says the practice has outpaced the growth of Accenture's overall consulting revenues, which have grown more than 20 percent year-over-year and topped $12 billion in 2010. "Every time I have a conversation with a CEO or board member, leadership and talent is always part of the conversation," Smith says. "It's top of mind in the C-suite and will be a key lever to winning in the future." Consulting recently sat down with Smith to discuss talent, leadership development, recruiting, retention and the reasons for why the practice has been so successful.
Consulting: You took over in the fall in 2009. Can you give me a sense of just what you walked into at that point?
Smith: Well, the market was tanking and there were a lot of issues with the workforce, but they were all focused on costs and trying to drive high levels of productivity out of their workforce in a declining marketplace. That was the mantra around the world, really, although it hit the most mature markets, the Western markets, the hardest. But the good news for our practice was they were spending, and we were able to help clients cut costs and increase productivity.
Consulting: And how does that compare to the work you are doing today?
Smith: The projects we're doing today are more focused on positioning for the future. We're helping clients build their talent management strategy and human capital strategy—looking at the talent and skills needs they'll need to grow their business. Having the right skills for growth in the future in the right markets—that's the mantra right now. I think it's going to be 2012 before we see any material job expansion, and while the politicians remain focused on jobs, our clients are focused on skills.
Consulting: Where do you see the most opportunities for the practice?
Smith: Well, leadership development is very big right now. Having contemporary leaders that can operate on a different business model that's come out of the recession. In a lot of industries that means a shift to more services as opposed to more products. In some industries it means a shift to a greater use of the global workforce. There is a lot of pent-up demand in emerging markets. Eastern companies are being very aggressive to grow in Western markets. Western companies are being very aggressive in trying to finally understand how to penetrate and attract people in Eastern markets. This cross-fertilization is one of the reasons we've been able to grow. And our positioning as a global operator—my people are all around the world—has been a big advantage for us, as well.
Consulting: So, you see that global reach as a real differentiator?
Smith: There's no question about it. This is no longer a niche issue. The Human Capital Market is now a strategic lever of the global 2000, and that shift has been great for us. A niche player can not operate globally like we do and they can't drive C-Suite value the way we can. Talent has really moved out of HR and into the C-suite. About half of my clients are Chief Human Resources Officers, but the other half are C-level executives with different titles. The issue of attracting, developing and retaining skills is the number one issue in the C-Suite.
Consulting: What do you see as the biggest issues for clients?
Smith: Customization of the career path position is absolutely essential to win this new workforce. It's going to be the way of the future; it's going to be reality. It's going to become required, or you will have absolutely no chance to retain your top performers.
Consulting: Do you see retention as a huge issue?
Smith: The global economy has been a little soft and that's probably helped delay some of the retention issues, but there's no doubt it's coming, and has lead a shift in the work we are doing. Talent management systems will have to be customized by market, by segment of workforces, etc. The demographic shifts we are seeing will require much more customization. The economy has masked some of the hurt, I think, but we're going to be entering a new phase in the market soon enough.
Consulting: What else do you see when you look out a few years? What are the other areas that will impact talent management?
Smith: Well, there's no question that analytics will be huge over the next few years. In the past, people have always sort of viewed these types of talent and HR issues as "soft issues." But human capital analytics is making this area become much more tangible and results oriented. That's a welcome change, and it'll impact the entire life cycle of the talent proposition—everything from the attraction phase all the way to the retention phase. That will be red-hot for our practice over the next several years.
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