Seven Talent Trends We Must Be Ready for NowFebruary 13th, 2014
Organizations have been talking about the connection between great employees and superior organizational performance for decades. So what is now driving the current emphasis on Talent Management as a strategic business process? The need for agility – the ability to move more quickly than competitors in adapting to change – is the critical capability for organizational survival and success. Achieving agility requires executives and managers to adopt fundamentally new ways of thinking. Recognizing the trends that have a significant impact on talent acquisition and retention is vital.
- Global Competition: Survival of most organizations will depend on their ability to deliver unique value in a marketplace characterized by new forms of competition and a far greater number of competitors. The scope of these changes are beyond what most businesses are ready for.
- There is a Proven Relationship Between Better Talent and Better Business Performance: Accenture’s High Performance Study noted that the companies identified as “human performance leaders” posted stronger financial performance than the non-leaders over the short- and long-term. These companies generated a consistently higher rate of total shareholder value. Of particular note is the difference in the three-year return. Leaders generated nearly 9% return compared with non-leaders 0.6% loss.
- Diverse Workforces in Diverse Places: Free-market economic reforms and technological advancements are creating a global labor market. Traditional geographic boundaries surrounding the workforce are crumbling fast. In their place, a truly global job market, the likes of which have never been seen before, is being built. No longer are workers limited to marketing their skills solely within one country or region, they can now market themselves to organizations based anywhere in the world.
- Technology is Reshaping the World: We are now in the digital era. Communication has shifted from the one-to-many (broadcasting) to a many-to-many mode enabled by the Internet. This introduces some very basic changes into how we work, how we build wealth, how we manage work processes, and how production is carried out.
- The Cost of Talent Mistakes is Growing: As strategic talent becomes scarcer in many industries and jobs, and as human capital becomes a larger portion of overall corporate assets in many industries, the cost of talent mistakes will increasingly take its toll on the bottom line. Today, many recruiting, screening and selection processes are crude at best. Such imprecision will become extremely expensive in the coming years.
- Employee Expectations are Evolving: Today’s employees are far more sophisticated rewards “consumers” than previous generations of employees. They are better informed of their own market value, and they are willing to drive hard bargains with employers for their worth in skills, experience, education, training, and relationships. By and large, today’s high performers want jobs that not only meet their financial needs, but also yield the highest return, in ways that are meaningful to them, on their investment of time and talent. They continually evaluate other opportunities and offers, and they are quite prepared to take their talent elsewhere if their needs and expectations aren’t met. Additionally, the legacy of the business practice of downsizing has resulted in employees who are more interested in short-term gains in pay, titles, development opportunities, and benefits. Employees can no longer trust their employers to make good on promises of future advancement. And given that attitude, employers can no longer count on high potentials waiting for long periods before expecting rewards, advancement or professional development.
- Changes in Labor Supply & Demand: In 2005, the US passed a watershed moment in its history: for the first time in modern history, its labor and supply demand curves crosses. Demographic changes are exhausting essential skills from the workforce at an alarming rate. An aging global workforce and a widening “skills gap” in high-demand fields such as science and engineering are expected to deliver a severe blow to the labor market in the next few years.
Organizations make decisions about talent all the time. It is important that leaders inside and outside the HR profession evolve to make more of the vital talent decisions with a deep logical connection to organizational effectiveness and strategic success. The companies that will “win” the war for talent are those that can address the unique needs and opportunities presented by our globalized economy.