Talent management
Encyclopedia
Talent management refers to the skills of attracting highly skilled worker
s, of integrating new workers, and developing and retaining current workers to meet current and future business objectives. Talent management in this context does not refer to the management of entertainers. Companies engaging in a talent management strategy shift the responsibility of employees from the human resources department to all managers throughout the organization . The process of attracting and retaining profitable employees, as it is increasingly more competitive between firms and of strategic importance, has come to be known as "the war for talent
." Talent management is also known as HCM (Human Capital Management).
The term "talent management" means different things to different organizations. To some it is about the management of high-worth individuals or "the talented" whilst to others it is about how talent is managed generally - i.e. on the assumption that all people have talent which should be identified and liberated.
The issue with many companies today is that their organizations put tremendous effort into attracting employees to their company, but spend little time into retaining and developing talent. A talent management system must be worked into the business strategy and implemented in daily processes throughout the company as a whole. It cannot be left solely to the human resources department to attract and retain employees, but rather must be practiced at all levels of the organization. The business strategy must include responsibilities for line managers to develop the skills of their immediate subordinates. Divisions within the company should be openly sharing information with other departments in order for employees to gain knowledge of the overall organizational objectives. Companies that focus on developing their talent integrate plans and processes to track and manage their employee talent, including the following:
The talent management strategy may be supported by technology such as HRIS (HR Information Systems) or HRMS (HR Management Systems). Modern techniques also use Competency-based management
methodologies to capture and utilize competencies appropriate to strategically drive an organization's long term plans.
The major aspects of talent management practiced within an organization must consistently include:
. Talent management decisions are often driven by a set of organizational core competencies as well as position-specific competencies. The competency set may include knowledge, skills, experience, and personal traits (demonstrated through defined behaviors). Older competency models might also contain attributes that rarely predict success (e.g. education, tenure, and diversity factors that are illegal to consider in relation to job performance in many countries, and unethical within organizations). New techniques involve creating a Competency architecture
for the organization that includes a Competency dictionary
to hold the competencies in order to build job descriptions.
The Talent Review meeting is an important part of the overall talent management process; it is designed to review the performance and career potential of employees, to discuss possible vacancy risks of current employees, to identify successors and top talent in the organization, and to create development action plans to prepare employees for future roles in the organization. "This is what talent management is all about — gathering information about talent, analyzing their career interests and organizational business needs, identifying top talent and successes, and developing these individuals to reduce the risk of losing the best people and experiencing extensive leadership gaps when turnover occurs."
Skilled worker
A skilled worker is any worker who has some special skill, knowledge, or ability in their work. A skilled worker may have attended a college, university or technical school. Or, a skilled worker may have learned their skills on the job...
s, of integrating new workers, and developing and retaining current workers to meet current and future business objectives. Talent management in this context does not refer to the management of entertainers. Companies engaging in a talent management strategy shift the responsibility of employees from the human resources department to all managers throughout the organization . The process of attracting and retaining profitable employees, as it is increasingly more competitive between firms and of strategic importance, has come to be known as "the war for talent
The war for talent
The war for talent is a term coined by Steven Hankin of McKinsey & Company in 1997, and by Ed Michaels, Helen Handfield-Jones, and Beth Axelrod, Harvard Business Press, 2001 ISBN 1578514592, ISBN 9781578514595. The war for talent refers to an increasingly competitive landscape for recruiting and...
." Talent management is also known as HCM (Human Capital Management).
The term "talent management" means different things to different organizations. To some it is about the management of high-worth individuals or "the talented" whilst to others it is about how talent is managed generally - i.e. on the assumption that all people have talent which should be identified and liberated.
History
Talent management is a term that emerged in the 1990s to incorporate developments in Human Resources Management which placed more of an emphasis on the management of human resources or talent. The term was coined by David Watkins of Softscape published in an article in 1998 ; however the connection between human resource development and organizational effectiveness has been established since the 1970s . Talent management is part of the Evolution of Talent Measurement Technologies.
The issue with many companies today is that their organizations put tremendous effort into attracting employees to their company, but spend little time into retaining and developing talent. A talent management system must be worked into the business strategy and implemented in daily processes throughout the company as a whole. It cannot be left solely to the human resources department to attract and retain employees, but rather must be practiced at all levels of the organization. The business strategy must include responsibilities for line managers to develop the skills of their immediate subordinates. Divisions within the company should be openly sharing information with other departments in order for employees to gain knowledge of the overall organizational objectives. Companies that focus on developing their talent integrate plans and processes to track and manage their employee talent, including the following:
- SourcingSourcing (personnel)Sourcing in personnel management work refers to the identification and uncovering of candidates through proactive recruiting techniques.- Historical context :...
, attracting, recruiting and onboardingOnboardingOnboarding, also known as organizational socialization, refers to the mechanism through which new employees acquire the necessary knowledge, skills, and behaviors to become effective organizational members and insiders...
qualified candidates with competitive backgrounds - Managing and defining competitive salaries
- Training and developmentTraining and developmentIn the field of human resource management, training and development is the field which is concerned with organizational activity aimed at bettering the performance of individuals and groups in organizational settings...
opportunities - Performance managementPerformance managementPerformance management includes activities that ensure that goals are consistently being met in an effective and efficient manner. Performance management can focus on the performance of an organization, a department, employee, or even the processes to build a product or service, as well as many...
processes - Retention programs
- PromotionPromotion (marketing)Promotion is one of the four elements of marketing mix . It is the communication link between sellers and buyers for the purpose of influencing, informing, or persuading a potential buyer's purchasing decision....
and transitioning
The talent management strategy may be supported by technology such as HRIS (HR Information Systems) or HRMS (HR Management Systems). Modern techniques also use Competency-based management
Competency-based management
Competency-based human resources planning should serve as a link between human resources management and the overall strategic plan of an organization...
methodologies to capture and utilize competencies appropriate to strategically drive an organization's long term plans.
Human Capital Management
Companies that engage in talent management (Human Capital Management) are strategic and deliberate in how they source, attract, select, train, develop, retain, promote, and move employees through the organization. Research done on the value of such systems implemented within companies consistently uncovers benefits in these critical economic areas: revenue, customer satisfaction, quality, productivity, cost, cycle time, and market capitalization. The mindset of this more personal human resources approach seeks not only to hire the most qualified and valuable employees but also to put a strong emphasis on retention.The major aspects of talent management practiced within an organization must consistently include:
- performance management
- leadership development
- workforce planning/identifying talent gaps
- recruiting
Evaluations
From a talent management standpoint, employee evaluations concern two major areas of measurement: performance and potential. Current employee performance within a specific job has always been a standard evaluation measurement tool of the profitability of an employee. However, talent management also seeks to focus on an employee’s potential, meaning an employee’s future performance, if given the proper development of skills and increased responsibility.Competencies and Talent Management
This term "talent management" is usually associated with competency-based managementCompetency-based management
Competency-based human resources planning should serve as a link between human resources management and the overall strategic plan of an organization...
. Talent management decisions are often driven by a set of organizational core competencies as well as position-specific competencies. The competency set may include knowledge, skills, experience, and personal traits (demonstrated through defined behaviors). Older competency models might also contain attributes that rarely predict success (e.g. education, tenure, and diversity factors that are illegal to consider in relation to job performance in many countries, and unethical within organizations). New techniques involve creating a Competency architecture
Competency architecture
The start point for any application of competency based management is a competency model / profile that is valid and constructed in a way that it can be easily used to support all intended HR goals...
for the organization that includes a Competency dictionary
Competency dictionary
Competency dictionaries include all or most of the general competencies needed to cover all job families as well as competencies that are core or common to all jobs within the organization...
to hold the competencies in order to build job descriptions.
Talent marketplace
A talent marketplace is an employee training and development strategy that is set in place within an organization. It is found to be most beneficial for companies where the most productive employees can pick and choose the projects and assignments that are most ideal for the specific employee. An ideal setting is where productivity is employee centric and tasks are described as “judgment-based work,” for example, in a law firm. The point of activating a talent marketplace within a department is to harness and link individuals’ particular skills (project management or extensive knowledge in a particular field) with the task at hand. Examples of companies that implement the talent marketplace strategy are American Express and IBM.Current Application of Talent Management
In current economic conditions, many companies have felt the need to cut expenses. This should be the ideal environment to execute a talent management system as a means of optimizing the performance of each employee and the organization. However, within many companies the concept of human capital management has just begun to develop. “In fact, only 5 percent of organizations say they have a clear talent management strategy and operational programs in place today.”Talent Review
To develop a clear talent management strategy and to increase awareness of available talent and successors, all organizations should conduct regular Talent Review meetings to be prepared for a variety of business changes, such as mergers, company growth, or a decrease in talent needs. In the same way that all companies have regular meetings and reports regarding their financial status and budgetary needs, the Talent Review meeting is designed to review the current talent status and future successor needs in the organization.The Talent Review meeting is an important part of the overall talent management process; it is designed to review the performance and career potential of employees, to discuss possible vacancy risks of current employees, to identify successors and top talent in the organization, and to create development action plans to prepare employees for future roles in the organization. "This is what talent management is all about — gathering information about talent, analyzing their career interests and organizational business needs, identifying top talent and successes, and developing these individuals to reduce the risk of losing the best people and experiencing extensive leadership gaps when turnover occurs."