Talent function is more important than ever before. It has a seat at the table as most leadership discussions involve identifying, advancing and utilizing top talent in the best interests of business. But how exactly do you define talent strategy for a business? What should be its components? Far too often we see piecemeal or event-based approaches to talent strategy, and sometimes even me-too or fad-based efforts. On the positive side, there is a lot of knowledge, research, analytics and white papers being published by companies and thought leaders enriching the field.
Here are five key strategic elements that can have a profound and long-term impact on the success and viability of business:
1. Establish Direct Alignment with Business Strategy
Talent strategy should have a direct alignment with how it impacts the business strategy. Too often we find the linkage between the people side of business and how it reflects in business numbers, is based on assumptions that are too tenuous or such linkages simply do not exist.
Talent strategy starts becoming powerful and impactful when the linkage with business numbers is established clearly and measured consistently. To establish the same some specific measures need to be thought of and worked on by answering the question “How does Talent Strategy impact”:
- Revenue growth
- Profit growth
- Cost control and lean measures
- Customer retention
- Value per person
- Market share expansion
- New customer acquisition
- These are a few examples while there are many other figures that are extremely important to business.
2. Strategic use of talent analytics
Talent analytics, popularized in the last five years by best practices from tech companies such as Google and Facebook is revolutionizing leadership and talent management. Management is becoming more data and research-based than merely experience based. Every company has tons of data related to people practices that if mined correctly can provide unique and incisive insights and guidance for leadership decision making. From small tactical steps and process improvement to big decisions, data can provide direction, predict success and suggest mid-course correction.
However, making sense of data and building appropriate constructs is important, otherwise it is easy to be drowned by the quantum of data. Many companies track scores of meaningless statistics which eventually do not result into insights or fail to provide guidance for leadership decisions. Some guidelines that can help:
- Start with the most important business problems
- Convert the business problem into a hypothesis
- Develop data from both inside the company as well as larger data to test the hypothesis
- Some tests might be long-term and may require tracking over time
- Draw lessons and present to leadership
- Seek inputs and directions, validate with focus group and select audiences
Areas where analytics matters:
- Talent acquisition: sources of hiring, hiring process, candidate experience, quality of hires
- Talent engagement: participation and engagement levels
- Employee suggestions implemented and their impact
- Employee profiles, demographic data
- Talent wins and losses, indicators of employer branding
- Data related to performance management
- Analytics regarding employee movements; talent planning; succession planning
3. Talent Review and Top Talent Identification
A key component of talent strategy is identification and classification of talent. These eventually take shape as high potential programs; succession plans, 9-box reviews; planned and managed talent mobility actions. Some key questions that need to be taken into account:
- How do you define top talent and high potential? What are their characteristics? Is there a company-wide agreement on these?
- How do you assess and develop high potentials?
- Having identified top talent, what is next for them?
- A key aspect of top talent or high-potential programs is that these programs need to be driven by business leaders with HR as facilitator, advisor and the function which asks the right questions and keeps the program on track.
4. Culture Building and Transformation
An interesting comment from Facebook is “Culture eats strategy for breakfast”. The true hallmark of great companies is not their brilliant strategy, technology or products but it is the culture that produces remarkable successes and experiences consistently for customers and employees.
No talent strategy for talent can be complete without culture building in terms of messaging, symbols, leadership building and mapping of the journey from here to there. Culture is defined in sociology as a “series of habits” and when these habits – related to leadership actions, rituals of how employees and customers are treated - are built and refined over time, results start appearing.
Getting leadership to think about the consequences of their actions, about consensus building and about business strategy is important.
5. Employee Experience
Ultimately, business results flow from great employee experiences. When talented employees are excited and engaged about their work, they deliver great experiences for customers and eventually, great business results.
Talent strategy should focus on:
- Outcomes and measures for employee experiences
- Areas which improve employee experience
- Areas which serve as disablers
Many business and HR leaders fail to see the link between how emotions impact the outcome of work for employees. So while the emphasis is on obsessive measurement and achievement of business goals, the positive or negative emotions that either help or derail results are ignored. A great talent strategy is able to articulate and provide linkage between positive emotions of employees (which come from memorable experiences) and eventual business results.