Does your company have the right talent? The blunt answer is — not likely.
I read with great interest an article in Harvard Business Review summarizing the Talent Management Strategies Conference which took place in March. According to the author, experts from companies such as Cisco, Gap, Toyota, Wal-Mart and Oracle gathered to share perspectives at the conference.
During formal remarks, most speakers did their best to stay upbeat. But a different story emerged in the hallway chatter between sessions. Over coffee and muffins, attendees swapped stories of what it's like—even in a recession—to be battling a "talent problem."
Executives fumed about internal pipelines that keep producing the wrong kinds of leaders and the promotion paths clogged with lackluster managers who can't be moved. Conference-goers also expressed concerns about how well their companies' leaders can truly gauge a rising star's promise.
How bad is it? According to a recent survey:
Top that off with a skyrocketing retirement rate (330 people turn 65 every hour in the U.S.), the talent problem is a big one–and it isn't going away anytime soon.
I recently spoke with a representative of one of the largest companies in the U.S. who told me that during the next few years, talent will take over marketing as the chief investment in corporate America.
Due to the recession, many companies have made the mistake of back-burning the talent topic. This move is likely to have a long-lasting backlash on our economy.
The scary truth for many of America's largest enterprises is this: they don't have the right talent in place now, and they don't have a plan for future talent development either.
Companies aren't sure what they're looking for.
Even in the best-run organizations, talent is a mystery or an after-thought. Boards and chief executives may have decisive ideas about how to revamp priorities to deal with emerging markets, changing labor costs, health reform, or other profound changes in the business landscape. But few align their talent-assessment processes to their strategic priorities and it can take years to realign career development paths accordingly.
In the meantime, strategies and talent pipelines are out of sync and companies are grooming lots of superbly qualified candidates for leadership in dead-end specialties that don't have much to do with where the business actually needs to be going.
Talent development is just a slogan, not a culture.
What happens when managers regard the finding and grooming of future leaders as someone else's business and not theirs?
Roger Cude, senior vice president for talent management at Wal-Mart, refers to this as the creation of a corrosive culture of "talent importers" — executives who shirk the essential but selfless tasks of developing stars themselves,instead relying on others to do the job for them.
I run into this all the time in my consulting role. Senior executives will complain that young professionals need too much 'hands on' training. They grumble about having to give continuous feedback, and the mentoring and leadership development tasks, and they try to pass off the responsibility to someone else. This speaks volumes about a company's ability to retain and develop talent.
Furthermore, what happens when managers refuse to use talent development tools?
In recent surveys, more than 20% of talent-management specialists conceded that their tools for succession planning, executive coaching, and identifying high-potential employees are widely regarded within their own companies as not being simple or easy to use.
The finest mentoring and assessment tools aren't much use if no one puts them into action. Here again, negligence to use–or change–a process speaks volumes about the importance of talent within a company's culture.
Wal-Mart is working on the antidote. It tracks how well its top executives are doing to meet and inspire the company's up-and-comers. Data is shared and compared. Executives with strong scores are rewarded; those who can't be bothered are told that hey have a problem.
The result is that Wal-Mart's intensely competitive top echelon of executives try to outdo one another in being seen as champions of talent development. And the entire company benefits.
Companies don't know how to get better.
Traditionally, the payoff from talent development efforts is hard to measure and takes years to play out. As a result, there haven't been many systematic efforts to keep track of what assessment techniques are most valuable within a company; which bosses have the best eye for talent, or what recurring mistakes ought to be fixed.
A talent expert at IBM is trying to fix that. He is developing a tracking system that keeps track not just of executives' career paths, but also of their assessments and training along the way. That tool gives his team the potential to size up IBM's own talent-development efforts so the company can see where it's getting the best results and where it has bottlenecks that need fixing.
On the flip side, holding up a mirror to executives can be a difficult concept to introduce–and accept. Our company has a formula for tracking talent development ROI, measuring progress and providing valuable insight to a company's talent development process–including the successes and pitfalls.
Yet, few of our clients take advantage of the formula because they fear what they will find and they loathe being held accountable for someone else's career.
I would argue that companies should fear that they are falling behind and loathe the idea that they are hiring the wrong talent, failing to develop their existing talent, or building a pipeline of future talent.
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