About a year ago I participated in a panel discussion on Talent Management where the central question was, “What can we do differently to develop talent in a down economy?” It was a great topic then, and it has become an even more relevant one over the last twelve months as the economic environment has continued to deteriorate.
There was plenty of valuable discussion around the issues that you would naturally expect to be on people’s minds: How can we cut costs without reducing the value that we deliver? What is the business case for continuing to invest in learning and development in tough times? The panel responded to these and many other questions with their perspectives and generated a lively discussion.
One response to this subject resonated particularly well with me. It came from a panelist who essentially said, “I’m not doing anything differently now that times are tough—the business case for good talent management and development practices is the same in good times as it is in bad times.”
While the economic environment that we now face a year later is carrying all of us into uncharted waters, I still agree with the sentiment of this perspective. Truly world class talent management systems are relatively robust in difficult times because they work, and everyone in the organization understands that they work. I believe that at their root, organizations whose talent management systems are described as world class are described as such because they have done three things particularly well:
1. Embedded talent management in the organization’s strategy process. Mature talent management systems play the critical role of translating the organization’s strategic plans and priorities into concrete implications for the current and future supply of talent. This linkage between business direction and people implications grounds the talent management system in the needs of the business in a way that makes it difficult to even raise the question, “Should we continue to invest in developing our people?” Everyone in the organization operates with a clear understanding and awareness of how the talent development practices feed into the achievement of strategic objectives.
2. Institutionalized senior leaders’ ownership for talent management. The CEO and his or her senior team truly view talent as a key to success, and take personal responsibility for relentlessly developing talent. Having senior leaders’ support goes a long way toward embedding the talent management system into the culture, but it is not sufficient. Many leaders express the belief that talent is their greatest asset, and many of those leaders are zealous about people development. The best companies have institutionalized a common talent management ethos and apply talent management practices such that the effectiveness of the people development system is not dependent upon any individual leader.
3. Strategically guided the expenditure of development resources and effort for maximum impact and return. When you have created a talent management system that identifies the capabilities needed to deliver on key strategic priorities, it is relatively easy to ensure that your development dollars are being spent to develop the right capabilities in the right people at the right time. Rather than spending more or less on development, the best companies put their investments into those people who can provide the best return to the company. That means that they invest less in some individuals and more in others–high potentials, top talent, or whatever you call them (John Boudreau and Peter Ramstad have written a great book that covers this concept well, Beyond HR: The New Science of Human Capital). As you can imagine, doing this effectively requires well-developed organizational processes and systems.
Sure, there are likely a raft of cost-cutting measures that you can take to manage through the downturn: expanding virtual work arrangements, better resourcing of vendors and suppliers, leveraging e-learning, etc. But, if you are working in an organization that is on a journey toward world class talent management, perhaps the best way to develop talent in a down economy is to work at making progress on these fundamentals. Not an easy task, but making progress on these dimensions in a down economy will leave you that much stronger when things turn around.
Filed under: Executive Education, Talent Management
