How to Strengthen Your Talent Management Strategy in 2019

Harvard Business Review recently tracked three top-performing companies that reshaped their industries and discovered some commonalities. All three proved to bepurpose-driven, performance-oriented, andprinciples-led—which is what you would expect. But what else is in the mix that set these organization apart?Put simply, the answer can be summed up in one idea: people are everything. All three companies have superior talent strategies. A well-developed talent management strategy consists of coordinated functions both within HR and throughout an entire organization for recruiting, selecting, allocating, developing and rewarding talent. With this kind of proactive approach, a company can avoid the high turnover, employee dissatisfaction and missed objectives that plague many organizations.

An intentional talent management strategy has a positive and measurable impact on business outcomes across every industry. 

Results from a recent McKinsey Global Survey, “Winning with your talent management strategy,” reveal organizations with effective talent-management programs have a better chance than other companies of outperforming competitors and, among publicly owned companies, are likelier to outpace their peers’ returns to shareholders. By having a strong recruitment strategy, cross-functional teams, succession planning, and meaningful rewards in place, an organization sets itself up to thrive in a dynamic marketplace.

Why Is a Talent Development Strategy Important?

Talent management directly impacts a firm’s bottom line. According to the McKinsey survey’s 1820 respondents, companies with very effective talent management are six times more likely than those with very ineffective talent management to report higher total returns to shareholders than competitors. 

Several practices contribute to effective talent management as well as organizational performance, including rapid allocation of talent, more frequent project-based performance reviews, the active involvement of HR in fostering a positive employee experience, and a strategically-minded HR team with experience in other business functions. In other words, a well-oiled talent management strategy puts the right people, with the right skills, in the right place at the right time to deliver results and fulfill an organization’s mission.

How Does Implementing a Talent Development Strategy Help Employees and the Business?

One driver of effective talent management relates to how positive the overall employee experience happens to be at an organization. Specifically, the HR function’s role in ensuring a positive experience across the employee life cycle is a key factor in building an effective talent management strategy. 

An organization reporting a positive employee experience, according to McKinsey, is one in which:

• Teams are empowered to make decisions, operate with trust and employ user-friendly processes. 
• Individuals do purposeful work for meaningful rewards and recognition, encouraged by managers who provide regular coaching and feedback.
• There are a positive workplace environment and culture.

Only 37 percent of respondents to the McKinsey talent management survey say that their organizations’ HR functions facilitate a positive employee experience. However, those who do are 1.3 times more likely than other respondents to report organizational outperformance. 

Because this factor matters, there has been an increase in companies such as Cigna and Proctor & Gamble offering coaching skills training to managers. In other words, it’s not about offering employees perks like free food. It’s about fostering an environment of personal growth and development. This kind of positive workplace is a win-win for both employees and the business.

What Are Some Best Practices for Building an Effective Talent Development Strategy?

In addition to creating a culture of growth, there are several best practices for building a talent management pipeline. Effective talent strategies are focused on supporting and driving companies’ business strategies. To do so, talent initiatives are comprehensive—they permeate the organization at every level and in every division. 

Commitment from the top executive team is also a non-negotiable when it comes to developing talent. 

Leaders at organizations that are good at talent management are engaged in the process and see to it that their direct reports spot, develop, and retain the next crop of leaders. Executive-team involvement in talent management was highlighted in the McKinsey Global Survey. Respondents who said their leaders are involved in talent management are 3.4 times more likely to report rapid talent allocation at their organizations, a key aspect of effective talent management. 

Furthermore, at organizations that quickly reallocate talent, executive teams usually review talent allocation at least once per quarter, meaning the frequency of leaders’ involvement makes a difference.

The next best practice regarding talent management strategy centers on recruitment. This requires making investments in your people and relying on in-house recruitment instead of getting by with headhunters. It also means creating a business culture that can serve as a magnet for talented prospects. Is your culture one of positivity and energy? Is your organization authentic and transparent? These cultural factors have a significant impact on your organization’s overall reputation and ability to attract and retain top talent.

More best practices for effective talent management include:

• Talent planning and active recruitment across every department or business unit
• Fostering a high-performance culture by raising performance standards and promoting high-potential individuals
• Prioritizing leadership behaviors that promote the firm culture
• Developing direct reports via coaching, mentoring and regular training opportunities

The Role of Immediate and Ongoing Feedback

Finally, the last shift regarding talent management strategy involves dropping the annual performance review in favor of more frequent project-based reviews. This allows leaders to more quickly allocate talent, a key factor in developing an effective talent management strategy.

According to the Harvard Business Review, organizations in many industries have switched to frequent performance assessments, including: 

• Retail (Gap)
• Pharma (Pfizer and Regeneron Pharmaceuticals)
• Insurance (Cigna)
• Investing (OppenheimerFunds)
• Consumer products (P&G and Johnson & Johnson)
• Accounting (all Big Four firms)

This practice is, of course, designed to provide more immediate feedback to employees. As a result, teams can correct mistakes more quickly, improve performance and learn through iteration. In addition to more frequent assessments, some organizations are also implementing peer-to-peer feedback. Upward feedback from employees to team leaders is an additional best practice for effective departments.

Talent Management Tools that Can Help

As your organization works to build its talent management strategy, it is crucial to track and measure development activities. One useful tool for this is Don Kirkpatrick’s four levels of evaluation. These are 1) participants’ reaction to a particular initiative or training, 2) their level of learning, 3) their behavior, and 4) the results, or whether you’re hitting defined targets. 

Other effective tools for measurement include tracking recruitment and retention data, department performance metrics and employee engagement survey results. 

A company might be full of talented employees, but if you don’t manage them in the right way, they’ll never perform to their full potential. Another tool that can help address your talent strategy challenge is the Inspire tool from The Predictive Index. This manager roadmap reveals how to manage employees based on their unique behavioral patterns and tendencies. This tool can be used to better understand and mentor employees as well as improve team performance and optimize group dynamics.

If your organization is facing high turnover or employee dissatisfaction and disengagement, you need new talent management programs, training and strategies to better address employee needs. 

Narish International can help you find and hire the right people by better defining jobs, performing job fit/gap analysis and by providing selection and hiring help. We help you build teams and develop leaders, build trust, manage transitions and improve productivity to drive revenue. 

If you’re interested in leveling up your talent management strategy, contact us today to build a higher performing team.