What does “talent” mean in corporate lingo? Often it’s a high-potential candidate. Other times, a star employee. Or even an experienced professional in a competitive field. You can pick the definition that’s closest to your company needs. But then again, how do you manage talent? Or, more so, what do we mean when we say talent management?
What is talent management?
Talent management is an HR strategy that aims to develop and retain high-performing employees.
Mind the word ‘strategy’ in the talent management definition above. Talent management is not a one-off effort; it’s an ongoing process that puts people first so that they can achieve business goals. And as a strategy, it requires the involvement of everyone inside the company:
- Line managers, who identify potential and training needs and coach their team members day to day.
- HR, which organizes trainings, compiles data around turnover rates, and analyzes skill gaps.
- Senior management, which promotes a learning culture and supports employee development initiatives, including career path planning and internal promotions.
Talent management strategies in action
Now that you can understand the importance of talent management, it’s time to get more practical. What is talent management on a day-to-day basis? While this differs from organization to organization, here are the main themes to consider when shaping your own talent management strategy:
Design career paths and promote from within
Employees value opportunities for career advancement (often, they’d pick a promotion over a salary increase). And while you might not be able to promote everyone, a mindset of continuous learning can make a difference. Employees will develop themselves and your teams will benefit from their newly acquired skills.
Foster a productive and equal workplace
To reach business goals, you need people. And people need resources, procedures and tools to perform their tasks. Make sure to give them what they really need and not what you think they need. For example, ask them to research and recommend new software that will make their working lives easier. Also, implement policies that give all employees equal opportunities to speak up when they face issues on the job and give them the chance to participate in challenging multi-team projects.
Recognize and reward employees’ achievements
Look beyond typical compensation plans and performance bonuses. Think of additional ways to thank your employees for their hard work and provide perks that will keep them happy in the workplace. You can use employee satisfaction surveys to learn what kind of rewards and benefits are most meaningful to them. Be sure to keep these as inclusive as possible to accommodate the diversity within your teams.
Build talent pipelines
That’s even if you don’t need them now. In a competitive job market, being able to quickly fill your open seats with the best people is a huge advantage. When you’re proactively sourcing and building relationships with potential candidates, you close hires faster and equip your teams with new employees who can contribute to your overall business goals.
How do you know, though, which talent management strategies to prioritize and how do you decide on the specific processes you will apply?
It’s all in the numbers
The way you manage employees is unique to your company, because your goals and needs are also unique. That’s why before you make any strategic decisions, you should track key HR metrics that give you a sense of where you stand right now compared to where you’d like to lead your company.
Here are some metrics to help you build your talent management strategy:
- Employee turnover: If you want to have high-performing employees, you need to develop their skills. And if you develop their skills, they’re more likely to stay longer with your company. But first, you should know where you stand. Calculate your turnover rates and gather quantitative data, as well. For example:
- When do most of your employees leave? Is it within their first two months at work? Then, maybe you should rethink your selection and onboarding processes. Otherwise, if employees usually quit after having worked with your company for several years, you should consider creating new career paths and offering more opportunities for internal mobility.
- Why do most of your employees leave? Exit interviews can help you collect this kind of information. Based on what you learn, change your regular procedures and introduce perks and benefits that will boost employee satisfaction in the future.
- Time to full productivity: No one expects new hires to complete their tasks perfectly and on their own from day one. But, did you know that it takes eight months on average to get to this point? Of course, it depends on the company, the role and the level of experience of the employee. When you spot, though, that your company’s average time to productivity is longer than it should be, you can redesign your onboarding and training activities to get your new hires up to speed more quickly. This way, employees will be able to contribute to the team sooner and they’ll also get more satisfied with themselves as they’ll see their results of their work.
- ROI of training: Employee training is a big part of talent management, but this doesn’t mean that all trainings are useful. It can also be expensive, but that doesn’t mean you should always pick what costs less. Compare how much you spend on training with what your company earns. In other words, measure the effectiveness of your training and development plans. How do you do this?
- Set specific goals before the training. What do you want employees to learn? (e.g. soft skills vs. technical knowledge) How will this impact their performance? (e.g. “After being trained on X software, salespeople will be able to contact twice as many customers on a weekly basis.”)
- Experiment with various learning methods. For some people, interactive lessons work best, while other prefer to learn at their own pace through an online course. Others, still, prefer in-person seminars or classes.
- Measure the outcomes. Discuss with trainees. Was this training useful to them? What did they learn that they’ll incorporate in their work? Use this feedback to organize future trainings that will be meaningful without hurting your budget.
- Performance indicators: The ultimate goal of talent management is to increase overall employee performance. So it goes without saying that you should measure employee productivity over time. No matter how you structure your performance reviews (e.g. quarterly vs. annual, etc.), check the performance of both individuals and teams. For example, you can check how many of your employees in one department:
- exceed expectations,
- meet expectations, or,
- are below expectations.
Low scores could be an indicator that you might have to implement new management techniques or that you should provide further training to some employees. But, don’t use performance metrics in isolation. Think of other factors that could impact employee performance. For example, if a team consists of many new members, it’s natural that it will take employees some time to fully onboard before they reach their individual and team goals.
What does the future hold for talent management?
Don’t expect to reinvent the wheel. There are no secret recipes or mind-blowing tricks on how to manage and retain talent. Neither will technological advancements (call me AI) change everything we knew so far. Talent management lies in the basic, yet everlasting, idea that if you want to work with high-performing employees you need to build a healthy work environment and help people grow inside your company.
Surely, new labor regulations, socio-economic changes and workplace trends impact the way you (should) treat employees. Consider, the need for talent management for the examples below:
- Politics and how they affect employment. With Brexit being one of the most prominent examples, you might need to come up with new strategies to navigate a potential skills shortage.
- The agility of working. Teams are embracing the agile methodology which creates the need for a more flexible work environment, in general, by replacing silos with cross-functional teams and open communication lines.
- Diversity and inclusion initiatives. This goes far beyond gender or race discrimination. Intersectionality in the workplace (i.e. overlapping biases) is a major priority for HR teams that want to treat all employees fairly.
As a final note, remember that a good talent management process begins with talent acquisition. You shouldn’t just think how to best manage your employees; you also need to make sure you’re bringing the right people on board.