The Talent Paradox:                               TalentA 21st century talent andleadership agendaA selection of recently ...
TalentContents               Foreword | 2              Attraction: New views of talent, work and strategy               Th...
The Talent Paradox: A 21st century talent and leadership agendaA world of talent Headwinds, Tailwinds and the Riddles of D...
TalentForeword             “  The future is already here. It’s just not	                                                  ...
The Talent Paradox: A 21st century talent and leadership agendamuch like the customer experience. Similarly,       to deve...
Talent4
The Talent Paradox: A 21st century talent and leadership agendaAttraction: New views oftalent, work and strategy          ...
The Talent Paradox: A 21st century talent and leadership agendaThe Talent ParadoxCritical skills, recession andthe illusio...
Talent             the majority of these employees have nowhere                     January 2010, there has not been a sig...
The Talent Paradox: A 21st century talent and leadership agenda    Software engineers are one area where com-           Me...
Talent              workforce segments that produce the most            to this and the overall increased demand in       ...
The Talent Paradox: A 21st century talent and leadership agendaFigure 2. Top three most effective retention initiatives by...
Talent              engagement surveys, focus groups and in-              as one of the three most significant fac-       ...
The Talent Paradox: A 21st century talent and leadership agenda    truck. However, employees now expect                   ...
Talent              the freedom necessary to pursue their passion      are modeled to identify predictive patterns,       ...
The Talent Paradox: A 21st century talent and leadership agendaWhy would anyone choose                                Anal...
Talent              Endnotes              1.	 Bureau of Labor Statistics. Job Openings            13.	National Solar Job C...
The Talent Paradox: A 21st century talent and leadership agenda                                                           ...
The Talent Paradox: A 21st century talent and leadership agendaTalent and WorkPlaying to your strengthsBy Jeff Schwartz an...
Talent                  Work-based solutions can include anything              employee life-cycle programs, as well as th...
The Talent Paradox: A 21st century talent and leadership agenda    Finally, a company can invest in especially     product...
Talent              Catalysts: The forefront of innovation              in talent management              Innovative appro...
The Talent Paradox: A 21st century talent and leadership agendato the length of his or her daily commute              an e...
Talent                  Executives worried, however, that the          An “alternative” solution              global mobil...
The Talent Paradox: A 21st century talent and leadership agendaestate, IT and HR departments. The project           advant...
Talent              Not all talent solutions require the same level   in every working day. If the covert messages        ...
The Talent Paradox: A 21st century talent and leadership agendaEndnotes1 	 “Talent at the Table,” Personnel To-    day, Ma...
TalentWhere Did Our Employees Go?Examining the rise in voluntaryturnover during economic recoveriesBy Bill Chafetz, Robin ...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte R...
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Decisions: Data and analytics are poised to reshape approaches to business including workforce and talent issues from recruitment to development to deployment.

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The Talent Paradox: A 21st century talent and leadership agenda A selection of recently published articles from Deloitte Review

  1. 1. The Talent Paradox: TalentA 21st century talent andleadership agendaA selection of recently published articlesfrom Deloitte ReviewForeword by Jeff Schwartz
  2. 2. TalentContents Foreword | 2 Attraction: New views of talent, work and strategy The Talent Paradox | 7 Critical skills, recession and the illusion of plenitude Talent and Work  | 19 Playing to your strengths Where Did Our Employees Go?  | 28 Examining the rise in voluntary turnover during economic recoveries Diversity as an Engine of Innovation | 38 Retail and consumer goods companies find competitive advantage in diversity Corporations, careers and culture Mass Career Customization | 53 Building the corporate lattice organization The Corporate Lattice  | 64 A strategic response to the changing world of work Culture and the Myth of the Black Box | 77 Why you can—and should—manage your company’s cultureii
  3. 3. The Talent Paradox: A 21st century talent and leadership agendaA world of talent Headwinds, Tailwinds and the Riddles of Demographics | 88 Talking About Whose Generation? | 98 Why Western generational models can’t account for a global workforce Smarter Moves | 108 Improving the value of global mobility by aligning strategy, investments and operations Deep Talent, Vast Distances | 119 Realizing the full value of global knowledge workersDecisions: Numbers, human nature and performance Irrational Expectations | 129 How statistical thinking can lead us to better decisions Beyond the Numbers | 140 Analytics as a strategic capability A Delicate Balance  | 153 Organizational barriers to evidence-based management 1
  4. 4. TalentForeword “ The future is already here. It’s just not ” very evenly distributed yet. —— William Gibson With the relentless march of technology- by populations that are different demographi- driven innovation, mobility and connected- cally and in their goals and expectations. ness, and a rising ocean of data redefining what Physical space, hierarchy and tenure, which is possible strategically, our industrial and together described most of what you needed post-industrial models for talent and the to know about talent in decades past, have organization are inadequate at best. The lost much of their preeminence and relevance. changes are in front of us every day and yet we Credentials and education are important, but rely on talent practices and models from earlier continual learning in the context of techno- eras: corporate ladders; organizational hierar- logical change and social collaboration is even chies; spans of control. Even the notion of more essential. “talent management” reflects an age when We are beginning to understand more much of the world’s work (and schools) were about how work will be done in this century organized on models that looked more like and the types of people who will thrive in factories and manufacturing lines than this environment. The collection of articles knowledge networks. that we present in this book will, we trust, Perhaps the 21st century for talent and inform a broader emerging view of a disci- work began with the current decade. The ’00s pline—focused on talent—that is emerging as were in many ways a continuation—the last co-equal with strategy and technology in many gasp—of the last century. In the past ten years, discussions of corporate growth and perfor- the world of work has redrawn its boundaries: mance. These articles examine several themes: we have seen three billion new capitalists join Attraction—the new retention: In the the global market place in China, India, Brazil, depths of the Great Recession, it became too the former Soviet Union and now Africa and easy to view talent as a simple in-out proposi- the Middle East; the emergence of a hyper- tion, with few people leaving and many want- connected world (albeit with spikes in global ing in. Given the critical nature and shortages creative city centers); and social and mobile of an increasing number of skills, however, technologies that have changed the way we live it has become clear that a recession is not a and work. serious retention strategy: businesses need to The challenges are clear: business is driven become better at understanding critical talent by globalization, technology, and hyper-con- and why the best decide to join, to stay – or nectedness. And yes, work is done differently— leave – and designing work in ways that seeks distributed, virtual, knowledge-intensive—and to improve the talent experience – perhaps2
  5. 5. The Talent Paradox: A 21st century talent and leadership agendamuch like the customer experience. Similarly, to development to deployment. The concept ofthe connections among the consumer market, making informed talent decisions by the num-business’s workforce and corporate brands can bers has moved from the realm of metaphor tobe particular sources of competitive advantage. the realm of possibility: what is the interplayDiversity, in all of its forms, is an essential between culture and talent analytics: what kindpart of this. In short, the challenge is mov- of company loves its quants and is better for it?ing beyond models of retention to strategies Are we ready – or even equipped as organiza-of attraction. tions – to accept the insights we can glean from Careers, culture and corporations: Oddly, data and analytics, or will we, like the scoutsgiven the significant shifts in how work is described in Michael Lewis’ Moneyball, clingdone, and in the aspirations of newer genera- to our gut instincts and tribal wisdom?tions with new expectations entering the work- The interplay between talent and work inforce, the ladder model for the corporate career the 21st century is evolving rapidly, and sotrack soldiers on with its uniform expectations should our views on how we lead and how we– for everyone. The importance and changing think about talent challenges. Generationalexpectations of talent in the new workplace changes and a global workplace transformedpoint to a need to revisit the one-size-fits-all by technology are putting stresses on the tra-approaches. Likewise, culture impacts perfor- ditional models. But, in almost any way I canmance, and the traditional and passive notion think of, this new, flat (okay, sometimes spikey)that culture “just happens” underestimates its and hyper-connected, work-anywhere worldimportance as a factor to be managed: an orga- is shaping up to be a fascinating and creativenization can be a platform for performance, or place. It is different. And it demands more ofa bog that impedes even the best from achiev- us as creators, collaborators, professionals,ing to their potential. specialists, producers, managers and leaders. It A world of talent: The art and science of is an exciting time for those comfortable withleading, attracting and developing talent in a new ideas. I believe the articles we have col-global context is emerging as both a challenge lected in this volume offer a taste of the oppor-and opportunity. Many businesses are far from tunities awaiting those who see the chance toproficient when it comes to deploying and change how we think about talent and workengaging with knowledge- and skilled workers in new, different, and hopefully increasinglyaround the world. Further, demographic issues impactful ways.vary by country, suggesting that it really is nolonger sufficient to implement one talent strat- Jeff Schwartzegy – or one product strategy – globally. Global Co-Leader, Talent, Decisions: Data and analytics are poised Performance and Rewardsto reshape approaches to business including Deloitte Consultingworkforce and talent issues from recruitment 3
  6. 6. Talent4
  7. 7. The Talent Paradox: A 21st century talent and leadership agendaAttraction: New views oftalent, work and strategy 5
  8. 8. The Talent Paradox: A 21st century talent and leadership agendaThe Talent ParadoxCritical skills, recession andthe illusion of plenitudeBy Robin Erickson, Jeff Schwartz and Josh Ensell> Illustration by Brian StaufferW ith relatively high unemployment and low voluntary turnover, it is tempt-ing to go back to “business as usual” and put difficult to meet skill needs while keeping labor costs at desired levels. A targeted retention strategy can helpemployee recruitment and retention challenges companies navigate the talent paradox throughon the back burner. Many executives may an increasingly sophisticated view of whatexpect there to be a surplus of labor avail- employees are looking for, what they value andable that companies can swoop in and grab why they are leaving. If a company can betterwhen the market picks up. However, this is understand why employees are leaving, it canonly half of the story. Despite high unemploy- take the requisite actions to get them to stay—ment, many companies are increasingly having in effect, creating a retention firewall to keeptrouble filling job vacancies, with over 3.2 employees in and competitors out.million unfilled jobs in the United States as ofJuly 2011.1 Worse, these shortages often occurin critical, skilled roles that have high barriers A recession isn’t a strategyto entry and are crucial to a company’s success.This points to a talent paradox: While there is asurplus of job seekers, some companies are fac- C ompanies face a labor market where, despite high unemployment, they still need to focus on attracting, developing, managinging shortages in critical areas where they most and retaining their critical employees who haveneed to attract and keep highly skilled talent. opportunities to leave for higher salaries andIn other words, high unemployment rates do more varied job roles and experiences. As thenot mean that the talent you need will be there economy improves, we expect employees withwhen you need it. critical skills will begin to leave their employers This talent paradox is raising the stakes in in larger numbers based on historical turnoverthe competition for critical talent, with organi- after recessions and recent Deloitte* researchzations trying to outbid each other for a select that suggests only 35 percent of global employ-group of critical employees and the skills they ees surveyed expect to stay with their currentneed to succeed. Poaching competitors’ top employers.2,3performers is becoming commonplace. This Since employees’ desire to change jobs is socompetition is fueling rising salaries as well as strong, one may wonder why these employeesprospective employees’ expectations, making it have not already left. The main reason is that 7
  9. 9. Talent the majority of these employees have nowhere January 2010, there has not been a significant to go in the current labor market. However, change in overall unemployment. Part of the critical employees whose skills are in demand, reason is that employees who have opportuni- no matter the economic situation, frequently ties in the market quit their jobs after receiving can leave to go to another organization. better job offers instead of quitting to join the Because organizations have a constant need for ranks of the unemployed.8 this critical talent, power in the labor market Lost critical talent is becoming increasingly for these skills and talent is shifting from difficult to replace as the shortage of skilled demand (organizations) to supply (employ- employees continues to grow, even in emerging ees). Even when the economy is down, these markets with higher numbers of science and employees have opportunities to leave if dissat- engineering students. Employees with critical isfied with their jobs and retention incentives. skills often fill roles with barriers to entry (e.g., Overall, quits (or voluntary turnover) have length of training, arduous certifications, legal dropped significantly since the recession began issues such as citizenship requirements), take in December 2007. However, since the a long time to develop the requisite experi- National Bureau of Economic Research ence, and are in limited supply. In these labor declared the end of the recession in June 2009, markets, companies can go out and buy more the economy is slowly beginning to see an workers (up to a point), but the wage increases increase in voluntary turnover as workers needed to attract these workers and make switch from one job to the next (Figure 1).4 In them take the risk of leaving their current May 2011, 2 million employees quit their jobs, jobs could be very significant. However, even the highest level since December 2008 and a 35 a large increase in wages will not necessarily percent increase from a low of approximately lead to many new people ready to fill the jobs 1.48 million employees who quit their jobs in in the short run; because of the time it takes January 2010.5 to develop these employees, it could be years Critical and highly skilled talent is cau- before workers are more readily available.9 This tious but increasingly on the move. Despite only increases the importance of a company’s an increased level of voluntary turnover since retention efforts to its overall success. Figure 1. U.S. quit level in thousands of employees, total nonfarm, seasonally adjusted (June 07 to July 11) Quit level (in 1,000s of Recession begins Recession ends employees) December 2007 June 2009 3,500 3,000 2,500 2,000 1,500 1,000 Jun Dec Jun Dec Jun Dec Jun Dec Jun 2007 2008 2009 2010 2011 Source: Bureau of Labor Statistics: Job Openings and Labor Turnover Survey6 and National Bureau of Economic Research78
  10. 10. The Talent Paradox: A 21st century talent and leadership agenda Software engineers are one area where com- Meeting the employeepanies’ inability to keep and find the engineer- retention challengeing talent they need is impacting their abilityto create new products. Daniel Gruneberg,co-founder of the daily deal site Zozi, notes C ompanies’ retention strategies should take an increasingly sophisticated view of why employees are staying and leaving. Yet, asthat “there are a lot of ideas, but to actually doit you need someone to build it.”10 Deloitte surveys and recent data show, business To try to attract the necessary talent from and HR executives’ perspectives on what theythe market or competitors, technology com- think their employees want and what employ-panies have begun to increase starting salaries, ees actually want often differ—this is especiallybenefits and stock options. Reggie Bradford, true of nonfinancial programs and priorities.CEO of Vitrue, noted that his company “now So where should business and HR leaderspays starting salaries of up to $90,000 for focus their retention efforts? To successfullyengineers with one year of experience,” over attract, develop and retain the key employees$20,000 more than they paid six months ago.11 needed to succeed in today’s economy, three Because of this high demand for talent, imperatives emerge:voluntary turnover and job switching are com- • Identifying the employees and skills mostmon in technology companies. For example, critical to your organization and strategy.Top Prospect, an incentive-based social recruit- • Determining what different groups, genera-ing site, analyzed the companies their users tions and, wherever possible, individualleft and subsequently joined to show the flow employees actually want through increas-of employees through Silicon Valley. Their ingly personalized approaches.analysis showed high flows such as Facebook • Cultivating your capabilities to understand,gaining 15.5 employees from Google for every anticipate and predict what is driving yourone employee Facebook lost to Google, Apple employees to leave.gaining 7.6 employees from Yahoo! for everyone lost to Yahoo!, and LinkedIn gaining 22employees from Microsoft for every one lost 1. Identifying the employees and skillsto Microsoft.12 While these flows are due in most critical to your organization andpart to the relative size of the companies and strategythe attraction of future IPOs, with constant Organizations should first identify theirturnover such as this, it is no wonder technol- critical workforce segments, those employeesogy companies offer a wide range of benefits to who drive a disproportionate share of rev-try to retain top talent. However, just as using enue, who are difficult to replace and withoutthe recession as a retention strategy has proved whom an organization cannot execute itsineffective, poaching employees with critical business strategy. These are the employees thatskills isn’t a strong talent strategy for long- a company needs to acquire and keep to beterm success. successful in the market. Identifying the keyDeloitte’s Longitudinal Talent Survey SeriesTalent Edge 2020 is a longitudinal survey series conducted for Deloitte Consulting LLP by ForbesInsights that explores changing talent priorities in all industries at large businesses in the Americas, AsiaPacific, and Europe the Middle East and Africa. Available at www.deloitte.com, the Talent Edge 2020series follows Deloitte’s Managing Talent in a Turbulent Economy series from 2009 and 2010. 9
  11. 11. Talent workforce segments that produce the most to this and the overall increased demand in value to the organization and focusing efforts the green energy sector, the National Joint on these groups enable executives to make tal- Apprenticeship and Training Committee, ent investments that yield the most significant a joint program between the International return. Our experience suggests that many Brotherhood of Electrical Workers and the companies think they do this but actually find National Electrical Contractors Association, it hard to do for a variety of reasons, including published a Green Jobs curriculum with 75 company politics, HR concerns and an egali- lessons to help apprentices learn new skills and tarian discomfort with saying one group of to further develop journeymen looking for the employees is more valuable to the organization skills needed to work in the green economy.14,15 than others. However, focusing investments on Developing employees with the skills needed critical workforce segments is no different than today is key to resolving the labor shortages; focusing capital investments on the areas of the however, development programs also need to company growing the fastest—it is all about be focused on the future as skills will continue getting the most return for the dollar invested. to evolve. Given how technological change, regula- Skills evolution has also occurred in the tions and globalization continue to drive services sector. For example, ManpowerGroup structural change in the labor market, compa- notes that companies are now looking for nies should go beyond identifying their critical salespeople who have skills such as “excellent talent in the present and also take a long-term oral presentation,” “critical thinking” and “con- view that considers finding and keeping the sultative approach: ability to read people, diag- skills needed now and in the future. It doesn’t nose problems” while only a few years ago they help that these skills are changing—sometimes were looking for salespeople who had “asser- rapidly. As the economy continues to evolve, tiveness,” “thorough knowledge of product or it will increase the pace at which current skills service” and “competitive nature.”16 Because of become obsolete and are replaced with new constant skill change, it is no longer enough to ones. For example, the skills companies needed hire a critical skills worker; you need to hire their software engineers to have only a few a critical worker who has the latest skills and years ago have now become commonplace and the ability to up-skill over time. If companies replaced with new ones such as mobile applica- want to thrive in a constantly changing market, tion development and HTML5—technologies they will not only need to attract and retain that barely existed only a few years ago. employees to fill key jobs; they will also need Not only are the required skills continually to focus on developing and attracting employ- changing in the world of technology, but most ees with the right skills within these jobs and companies are demanding new skills from keeping them. their skilled trade workers. Additionally, a lack Health care providers are experiencing this of qualified trade workers with the new, neces- issue in the area of medical coding. Coding sary skills is leading to labor shortages that is how organizations take the descriptions could impact the proliferation of new tech- of patients’ conditions and turn them into nologies. For example, in the solar industry, codes that can be easily tracked and grouped there is a rapid increase in demand for photo- together, and it plays a key role in insurance voltaic installers and electricians with specific reimbursement, reporting and quality of experience in solar installations as job growth patient care. Currently, the practice of medi- for these occupations was expected to exceed cal coding is going through a transformation 40 percent from 2010 to 2011. Given this rapid as companies and countries move from the growth, solar employers cannot find the quali- World Health Organization’s International fied workers they need as there are not enough Classification of Diseases (ICD) Ninth workers with the necessary skills.13 In response Revision to the ICD Tenth Revision. The10
  12. 12. The Talent Paradox: A 21st century talent and leadership agendaFigure 2. Top three most effective retention initiatives by generation:Executives’ expectations vs. employees’ desires Baby Boomers Generation X Millennials (ages 48 – 65) (ages 32 – 47) (31 and younger) EXECUTIVES EMPLOYEES EXECUTIVES EMPLOYEES EXECUTIVES EMPLOYEES# 1 Additional benefits (e.g., health Promotion/Job advancement* Promotion/Job Promotion/Job advancement* advancement* Promotion/Job Promotion/Job advancement* advancement* and pensions)# 2 Additional bonuses or financial Support and recognition from Additional bonuses or financial Additional bonuses or financial Individualized career planning Additional compensation incentives supervisors incentives incentives (within or managers* company)*# 3 Flexible work Additional arrangements* compensation Leadership development programs Additional compensation Additional bonuses or financial Additional bonuses or financial AND incentives incentives Flexible work arrangments* (Tied) *Indicates non-financial retention initiativechanges from ICD-9 to ICD-10 are signifi- ICD-10 skills are receiving large offers to leavecant—for example, the number of diagnosis their current employers and move to competi-codes will increase from approximately 13,600 tors. If health care organizations want to keepto approximately 69,000 to allow for more the medical coders that they invested in train-granular descriptions.17 Additionally, compa- ing from leaving, they will need to understandnies in the United States have to move to this their needs and target specific retention initia-new standard quickly as the U.S. Department tives to keep them.of Health & Human Services set an October1st, 2013 deadline for ICD-10 compliance.18 2. Determining what different groups, Some health care organizations have been generations and, wherever possible,early adopters in moving to ICD-10 and have individual employees actually wanttrained their employees on ICD-10 as part through increasingly personalizedof that transformation. However, since other approacheshealth care organizations now need these Once an organization confirms whichresources, competitors are increasingly trying employees are critical, they should conduct ato poach medical coders with ICD-10 skills. diagnostic to find out what these employeesBecause of increased demand, codersw with really want through anonymous employee 11
  13. 13. Talent engagement surveys, focus groups and in- as one of the three most significant fac- person conversations. Research from Deloitte’s tors that could cause them to look for new Talent Edge 2020 and Managing Talent in a employment today, while only 14 percent Turbulent Economy survey series has uncov- of surveyed employees in EMEA made the ered a tale of two mindsets where, for the most same choice.20 part, employers are unaware of which retention Talent management and retention need to incentives are most effective. Most compa- be viewed as a global art and science. For nies think they know what their people want, example, global corporations are more wor- but often do not take the time to understand ried about the poaching of critical employ- what different employees want from them ees in India than in the United States right or understand the impact the recession has now because even with shortages of key had over the last few years—e.g., yes, flexible skills, the talent markets in the United work environments are important, but after States are deeper than they are in emerging three lean years most employees are now more markets. Part of successfully managing the interested in promotions and higher compen- talent paradox is making sure that organi- sation. The risk is that many companies take zations that want to compete around the a blanket approach that does not reflect what world have a global portfolio of employees, employees truly value, which varies based on e.g., employees with the right skills in the generational, global and gender differences in right countries. addition to the current economic, technologi- cal and cultural environment. • Gender differences. Deloitte’s research • Generational differences: Different found that surveyed men appeared to focus generations have different goals, expecta- on financial incentives, while surveyed tions and desires—and employers should women were more likely to seek recogni- tailor their retention plans to satisfy them. tion. Among surveyed men, 42 percent Figure 2 reflects what executives think each said “additional compensation” would generation wants and what each genera- keep them from leaving and 39 percent tion is really looking for.19 Coming out of cited “additional bonuses or other finan- the recession, the foremost thing that cial incentives” as top retention incen- employees are looking for are promotions tives. Among women, only 27 percent followed by additional financial incentives cited “additional compensation” as a top for Millennials and Generation X and sup- retention incentive and only 19 percent port and recognition from managers for cited “additional bonuses.” Meanwhile, Baby Boomers. 40 percent of surveyed women said “sup- port and recognition from supervisors or • Global differences: The latest Talent Edge managers” would be a valuable retention 2020 report found that almost a third incentive, compared to just 28 percent of (32 percent) of the surveyed employees surveyed men.21 in Europe, the Middle East and Africa (EMEA) thought that “lack of job secu- • “I want what I want, and it’s not what rity” would be the top reason for them to you think.” As technology, the economy leave an employer and more than half (57 and culture change, so too do employees’ percent) of the EMEA employees surveyed expectations of their employers. Only a found promotion/job advancement to be few years ago, employees had never even the strongest retention incentive. Almost a heard of iPhones, would not have dared third (35 percent) of surveyed employees ask to work from home on a regular basis, in Americas and 21 percent in Asia Pacific and could not have carried their whole (APAC) chose “lack of trust in leadership” office with them unless they had a moving12
  14. 14. The Talent Paradox: A 21st century talent and leadership agenda truck. However, employees now expect (63 percent) surveyed Millennials rated a their employers to provide them the tools company’s commitment to “sustainability” as they need to work remotely and offer them “very important” compared to just one in three the chance to do so. To adapt continually to (35 percent) surveyed Baby Boomers. And by such changes, companies should focus on more than 2:1 (32 percent to 13 percent), having a culture that is open and receptive surveyed Millennials were more likely to to constantly changing its talent programs consider their employers’ commitment to to meet its employees’ needs. It is no longer “corporate responsibility/volunteerism” to be enough to have a “menu” of talent pro- very important than were surveyed Baby grams where employees can pick the ones Boomers. Work-life balance was most impor- that meet their tastes—instead, a talent tant to surveyed Generation Xers at 53 percent, strategy needs to focus on the company’s compared to 38 percent for surveyed Baby and employees’ core values to provide the Boomers.22 flexibility needed to meet the demands of As an example, W.L. Gore is a company that its talent. focuses on a set of fundamental beliefs and When looking at cultural aspects that guiding principles that serve as the basis of itscontribute to retention, consider how values strong culture.23 Part of its culture is believ-differ by groups of employees, such as genera- ing that employees should be passionate abouttions. Figure 3 shows that nearly two in three what they want to do and then giving themFigure 3. When considering an employer, how important is the organization’scommitment to the following? Baby Boomers Generation X MillennialsSustainabilityCreating a funwork environmentWork-life balanceCorporateresponsibility andvolunteerismDiversity andinclusionSource: Talent Edge 2020: Building the Recovery Together, April 2011, Deloitte Consulting LLP 13
  15. 15. Talent the freedom necessary to pursue their passion are modeled to identify predictive patterns, while at work. Its culture is also shaped by a such as the probability of voluntary turnover. lattice organizational structure that is “free Predictive analytics is a sophisticated approach from traditional bosses and managers” and to data analytics, creating leading indicators, as makes employees responsible for the work they opposed to historical insights. Using advanced choose to take on. Continuing to focus on this analytics to predict turnover risk, down to and other aspects of its culture has allowed the individual level, can provide the lead time Gore to be named in Fortune magazine’s “100 needed to identify employees who are likely Best Companies to Work For” for 14 years in to leave, help companies understand why a row. By continuing to focus on providing its each individual is at risk, and help determine employees what they need to live their cultural what to do today to minimize the risk of that values, Gore has been able to gain the talent it employee leaving. needed to earn a spot on Fast Company maga- The specific reasons that drive the individ- zine’s 2009 “Fast 50” list of the world’s most ual risk scores will be unique to each organiza- innovative companies.24 tion’s workforce, industry and culture. Rather than deploying costly blanket initiatives, using 3. Cultivating your capabilities to predictive analytics to determine why specific understand, anticipate and predict what individuals are at risk enables HR leaders to is driving your employees to leave invest in targeted activities that are customized to the individual or group at the most signifi- Too many organizations start actively cant risk of leaving and that have the most managing attrition at the moment a critical or likelihood of success through intervention. highly skilled employee tenders his or her res- Recognizing the high demand and turnover ignation—in other words, when attrition risk rate in management consulting, Deloitte has has reached 100 percent. A better paradigm developed a retention analytics model that would be to: identified possible predictors of voluntary • Identify which of your critical, high- turnover for key talent segments in Deloitte. performing and high-potential employ- The model helps Deloitte identify both indi- ees are most likely to leave six months in viduals and pivotal groups of employees most the future. at risk. For each employee, the model detailed • Understand the reasons why those indi- both the calculated attrition risk score and the viduals might leave. key drivers of that risk (reason codes). Some • Know what you can do to increase their of the top reason codes for Deloitte were the likelihood of staying. average number of flights taken per week, the average number of hours worked per week, The use of retention analytics and predic- and the number of paid time off (i.e., vacation) tive models allows organizations to identify hours actually taken. The tool also identified employees at risk of leaving before they leave, actions that might mitigate the risk of turnover helping companies to develop the mitigat- for each employee with a high probability of ing programs needed to keep their critical attrition. Key retention initiatives will soon be employees. By understanding what employees implemented by individual, pivotal role and are looking for and what their options are, key demographics. organizations can do a better job of giving their employees what they want. Internal data (promotion, compensation, etc.) and external data (demographics, economic indicators, etc.)14
  16. 16. The Talent Paradox: A 21st century talent and leadership agendaWhy would anyone choose Analytics and predictive models can highlight which employees are most at risk of leavingto work here (and why and suggest what actions might get them towould they stay)? stay. Analytical tools and capabilities are nowG iven the talent paradox, that is the ques- tion many companies should answer ifthey hope to attract and retain critical, scarce an attractive investment for business leaders whose plans rest on having critical talent in the organization.and highly skilled talent. Companies can no Ultimately, there is no off-season. With thelonger assume they can easily acquire the criti- global economy in the doldrums, it is temptingcal talent and skills they need or that talent will to consider the recession as an unfortunate butstay put in their organizations simply because convenient moat around critical talent. Yet, justof economic conditions: The recession and as planning continues in a turbulent economy,current weak economy are no longer a viable the competition for the best players to imple-retention strategy for highly skilled and prized ment those plans also continues. Neither “theemployees and leaders. Given the growth economy” nor “talent” are monoliths. Even asaspirations of many companies and the scar- some segments of the workforce see their for-city of critical skills and talent, no matter the tunes fall, others are well aware that they willeconomic state, it is increasingly important to be key players in growth segments during andproactively focus on giving employees a reason especially after economic conditions improve.to stay and grow with the organization. Being the place those workers seek out, stay At some level, this boils down to treat- and grow is to be in a position of strength.ing critical talent like customers, focusing onneeds and expectations for money, benefits, job Originally published inexperience, development and corporate values Deloitte Review #10, 2012to develop talent or employer brands thatclearly summarize what employees (current About the authorsand future) can expect from their employer.The employer brand a company offers should Robin Erickson, PhD, is a specialist leader ingive employees a sustained reason to want to Talent Strategies with Deloitte Consulting LLP.join, stay and grow—focusing on financial, Jeff Schwartz is a principal with Deloittetangible and intangible benefits including a Consulting LLP and a global co-leader incompany’s culture. To build a strong employer Deloitte Touche Tohmastu Limited’s Talent,brand, companies should identify their critical Performance and Rewards group.employees and determine what they really Josh Ensell is a consultant with Deloittewant and combine their talent experience Consulting LLP.with their customer experience and overallcorporate mission. Finally, there is a good dose of scienceemerging in what was once mostly art. 15
  17. 17. Talent Endnotes 1. Bureau of Labor Statistics. Job Openings 13. National Solar Job Census 2010: A Review of and Labor Turnover Survey, Series ID: the U.S. Solar Workforce. The Solar Foundation. JTS00000000JOL (A). [Database]. Available October. 2010. < http://www.thesolarfounda- from <http://www.bls.gov/jlt/data.htm> Ac- tion.org/sites/thesolarfoundation.org/files/ cessed November 2, 2011. Final%20TSF%20National%20Solar%20 2. Bill Chafetz, Robin A. Erickson, & Josh Ensell. Jobs%20Census%202010%20Web%20Ver- “Where Did Our Employees Go? Examining the sion.pdf> Accessed September 22, 2011. Rise in Voluntary Turnover During Economic 14. “About the NJATC,” National Joint Recoveries,” Deloitte Review, Issue 5, 2009. Apprenticeship and Training Com- 3. “Talent Edge 2020: Building the recovery togeth- mittee. <http://www.njatc.org/about. er—What talent expects and how leaders are re- aspx> Accessed September 22, 2011. sponding,” April 2011, Deloitte Consulting LLP. 15. “NJATC Rolls Out New Green Jobs Curricu- 4. National Bureau of Economic Research. US lum,” International Brotherhood of Electrical Business Cycle Expansions and Contractions. Workers (IBEW), June 8, 2009. <http://www. <http://www.nber.org/cycles/cyclesmain. ibew.org/WorkingGreen/content/training/ html> Accessed August 28. 2011. EW090408_NJATC_green_curriculum_UP- DATE.htm> Accessed September 22, 2011. 5. Bureau of Labor Statistics. Job Openings and Labor Turnover Survey, Series ID: 16. “Manufacturing” Talent for the Human Age JTS00000000QUL (A). [Database]. Avail- 2011, ManpowerGroup. <http://www.experis.us/ able from <http://www.bls.gov/jlt/data. Client-File-Pile/Site-Documents/Manufactur- htm> Accessed November 2, 2011. ingTalent.pdf> Accessed September 15, 2011. 6. Ibid. 17. “ICD-10 FAQ,” American Academy of Profes- sional Coders (AAPC). <http://www.aapc.com/ 7. National Bureau of Economic Research. US icd-10/faq.aspx> Accessed September 16, 2011. Business Cycle Expansions and Contractions. <http://www.nber.org/cycles/cyclesmain. 18. “Transactions and Code Sets Regulations: html> Accessed August 28. 2011. Standards for Electronic Transactions—New Versions, New Standard and New Code 8. George A. Akerlof, Andrew K. Rose, and Jenet Set—Final Rules,” Centers for Medicare and L. Yellen, “Job Switching and Job Satisfaction Medicaid Services. <https://www.cms.gov/ in the U.S. Labor Market,” Brookings Papers TransactionCodeSetsStands/02_Transaction- on Economic Activity, 1988, Vol.2, 495–594. sandCodeSetsRegulations.asp#TopOfPage> 9. Geoff Riley. “Supply of Labour to Markets”. Accessed September 16, 2011. Tutor2u. September 2006. <http://tutor2u.net/ 19. “Talent Edge 2020,” in press, De- economics/revision-notes/a2-micro-supply- loitte Consulting LLP. of-labour.html> Accessed August 28, 2011. 20. “Talent Edge 2020: Building the Recovery 10. Laurie Segall, “Tech companies desperate for Together,” April 2011, Deloitte Consulting LLP. ‘rockstarninja engineers.’” CNNMoney. 7 March 2011. <http://money.cnn.com/2011/03/07/ 21. Ibid. technology/tech_engineers_wanted/index. 22. Ibid. htm> Accessed September 8, 2011. 23. “What We Believe: Our Beliefs and Principles,” 11. John Helyar and Douglas MacMillan, W.L. Gore. <http://www.gore.com/en_xx/ “Techdom’s Talent Poaching Epidemic.” careers/whoweare/whatwebelieve/gore-culture. Bloomberg Businessweek. March 3, 2011. html> Accessed September 14, 2011. <http://www.businessweek.com/maga- 24. “Working in Our Unique Culture: ‘Make zine/content/11_11/b4219017796986. Money and Have Fun,’” W.L. Gore. <http:// htm> Accessed September 8. 2011. www.gore.com/en_xx/careers/whoweare/ 12. “The Biggest Talent Losers (and Winners).” ourculture/gore-company-culture. TopProspect Blog. June 6, 2011. <http://blog.top- html> Accessed September 14, 2011. prospect.com/2011/06/the-biggest-talent-losers- and-winners/> Accessed September 8, 2011.16
  18. 18. The Talent Paradox: A 21st century talent and leadership agenda 17
  19. 19. The Talent Paradox: A 21st century talent and leadership agendaTalent and WorkPlaying to your strengthsBy Jeff Schwartz and Andy Liakopoulos> Photography by David ClugstonF or an increasing number of organizations, the talent crisis is no longer an abstrac-tion. It’s an all-too-real threat that’s spurring Such a narrow view of talent management is common among organizations today. At many companies, what goes by the name of “talentexecutives, perhaps for the first time, to begin management” consists primarily of programsto treat talent as a vital business concern. But focusing on the employee life cycle — pro-despite the best of intentions, business lead- grams such as recruiting and hiring, learningers often struggle to link their talent efforts to and development, performance management,business strategy in practice. They have trouble and succession planning. Some companiesidentifying talent solutions that address busi- even focus their talent programs on pointness issues. Or the solutions they choose don’t solutions within the employee life cycle, anwork well enough. Or even when the solu- approach encouraged by technology vendorstions work, they’re too expensive or unwieldy who in the past few years have relabeled theirto sustain. single function HR software as “talent manage- These struggles often result from over- ment” solutions.looking a key piece of the talent manage- Of course, employee life-cycle programs arement puzzle: changing the way work itself is critical. Companies rightly invest significantdefined and done to align more closely with effort, sometimes even too much, in doingthe employer’s talent pool. A broader view of them well. But important as they are, they aretalent management that includes both work- only one piece of a much bigger picture.force and workplace approaches can reveal Missing from the widespread view of talentan increased range of potential options for management is the broader concept of engi-addressing talent-related strategies and achiev- neering the work to fit the available talent, asing business results. well as the other way around. In contrast to “talent-based” approaches that focus on help- ing the available talent better do the work in itsExpanding the talent existing configuration, “work-based” solutionsmanagement universe focus on changing the what, when, where“T alent management,” one HR execu- tive said in a 2008 Personnel Todayarticle, “really is only excellent performance and how of the work being done to better accommodate the realities of the internal and external talent market. Because relatively fewmanagement.”1 This remark illustrates the companies engage in work-based solutions,tendency of companies to turn to a growing list those that can effectively manage work-basedof silver bullets and point solutions that claim and talent-based approaches would be betterto solve the key problem driving the array of positioned to gain a real competitive advantagetalent challenges companies face. over those that don’t. 19
  20. 20. Talent Work-based solutions can include anything employee life-cycle programs, as well as the that changes the way work is defined, how it essential work-based activities needed to orga- is organized, and how and where it is done. nize work at any company, such as basic job They range from job redesign and process and organization design. reengineering to virtual workplace and social Differentiating solutions, in contrast, networking initiatives. They can even involve distinguish an employer by delivering value in changing a company’s basic operating model a way that relatively few other employers can to make its operations and work processes duplicate. They focus on talent solutions that more conducive to employee productivity are linked directly to critical talent, custom- and engagement. ers, and specific business activities. Though Both talent-based and work-based the list of differentiating solutions is constantly approaches can include what might be called shifting as new ideas arise and older ideas are “core” and “differentiating” solutions. Core more broadly adopted, current candidates solutions are activities that almost all compa- include targeted talent-based approaches, such nies perform. While some companies may be as accelerated development and global sourc- better at them than others, they generally do ing, as well as work-based solutions, such as not fundamentally distinguish one employer virtual workplaces, social networking, and from the next. They include most traditional global mobility. Figure 1. The expanded universe of talent and work solutions TALENT-BASED WORK-BASED Recruitment & Staffing Knowledge & Collaboration Orientation & Onboarding Organization Design Performance Management Work Design Learning & Development Job Design CORE Succession Management TALENT DIALOGUE* REWARDS TRANSFORMATION* MASS CAREER CUSTOMIZATION* DIFFERENTIATING EMPLOYER BRAND* Accelerated Development Global Mobility Coached Organization Social Networking Global Sourcing Virtual Workplace * Catalyst20
  21. 21. The Talent Paradox: A 21st century talent and leadership agenda Finally, a company can invest in especially productive sooner, but lessen the need forinnovative, far-reaching approaches that can new engineering talent in the first place. Thebe described as “catalysts.” Catalysts are solu- company is consolidating its IT environmenttions that transcend the talent-based/work- to simplify the engineering workflow, signifi-based and core/differentiating distinctions. cantly reducing the training requirements forThey embody a “talent-centric” approach that, new engineers. It also is leveraging the skillssimilar to customer-centric external sales and of its retired engineers through a collectivemarketing programs, focus on understanding intelligence technology platform that allowsemployees’ needs, preferences and expecta- retirees to work on projects as independenttions to deliver an outstanding total employ- contractors. Drawing on improvements inment experience. Because so few companies work processes and enabling technology,today have adopted such talent-centric the platform delivers work requirements toapproaches, catalysts that take “talent-cen- contractors in an organized manner, efficientlytricity” to a high level can drive exceptionally incorporates input and delivers feedback, andstrong differentiation. allows contractors to work on a very flex- Figure 1 shows the expanded universe of ible basis. The company combined talent andtalent-based and work-based solutions. Using work in an approach that lowered the needthis model as a guide, executives can begin for new recruits and extended the productiveto systematically explore the possibilities for life of soon-to-be and newly retired engineers,developing talent strategies that extend beyond through the reengineered work processes,the employee life cycle to take advantage of systems and platform. The approach also gavework-based solutions, differentiating solutions, the company continued access to the valu-and catalysts, as well as the more traditional able experience and skills that its retireestalent-based, core approaches. This expanded would otherwise have taken with them whenway of thinking can suggest new approaches they retired.that may deliver results more effectively thanemployee life-cycle solutions alone. Talent as a component of business strategyBacks to the wall Consider what one industrial productsmanufacturer did when it realized that 70 per- G iven the dynamic nature of business strategy today, talent strategies and solu- tions need to be grounded in business plan-cent of its engineers would retire over the next ning and operations more than ever. This isfive years. In this company’s case, intensive where a systematic approach to aligning talentrecruiting and hiring efforts weren’t enough strategy with business strategy can offer valu-to make up the shortfall; schools just weren’t able guidance. Such alignment begins withproducing enough qualified engineering articulating the company’s business objectivesgraduates. Moreover, a fragmented informa- and determining, as specifically as possible,tion technology (IT) environment and a high the nature of the talent needed to achieve eachreliance on manual work processes not only of those objectives. Once executives clearlyhampered engineers’ efficiency, but made it understand an organization’s talent needs, theyhard for new engineering hires to reach com- can examine internal and external patterns ofpetency quickly enough to replace the skills talent supply and demand, identify current andbeing lost to retirement. likely future talent gaps, and develop specific Instead of simply intensifying its recruit- approaches for filling those gaps based on aning efforts, the company decided to change understanding of what critical talent valuesits work environment in a way that would and the company’s own appetite for cost, risknot only help new engineers become more and change. 21
  22. 22. Talent Catalysts: The forefront of innovation in talent management Innovative approaches being piloted by companies and organizations around the world include: Talent dialogue. In talent dialogue — modeled on customer-facing market research strategies — an employer establishes a systematic, ongoing dialogue with its employees to better understand their views and expectations about the employment experience. Through a variety of channels, the employer explores topics such as employees’ satisfaction with specific talent and HR programs, career goals, current and future life situation, salary and benefits expectations — anything, in short, that can help guide the employer’s talent management efforts. Rewards transformation. Rewards transformation involves tailoring the design of a company’s total rewards program to align with its employees’ needs and expectations as uncovered through talent dialogue. By understanding employees’ views on a broad range of work-related factors — including not just compensation and benefits but any aspect of the work environment that can affect employee behavior — employers can design total rewards programs that shape employee behavior more effectively than making changes to compensation and benefits alone.2 Mass Career Customization. In Mass Career Customization, an organization trades the traditional corporate ladder model of career advancement for a more dynamic “corporate lattice” that allows for planned descents and lateral moves as well as upward climbs. Using the corporate lattice model, employer and employee collaborate to align employees’ work responsibilities with their life circumstances in a range of ways that satisfies both parties’ changing needs.3 Employer brand. An employer brand, analogous to a product brand, seeks to encapsulate the total value that employees gain from their relationship with an employer. By articulating and promoting an employer brand, a company can communicate the value of an integrated portfolio of benefits, helping employees appreciate the full scope of what the employer offers and enhancing the attractiveness of the employee-employer relationship. Several concepts and techniques can intelligence.” Just as companies collect, be especially helpful in translating a broad mine and analyze customer data to better understanding of talent needs into specific understand their markets, workforce intel- talent solutions. Perhaps foremost is the ligence applies advanced analytics to the concept of “critical workforce segments” — huge amounts of workforce-related data employee populations that drive a dispro- typically found in ERP systems, HR informa- portionate amount of business value, that are tion systems, and other repositories to help difficult or expensive to replace, and whose employers better understand their employees. skills are in high demand. (An example Workforce intelligence allows employers to would be the engineers at the manufactur- go beyond the lagging indicators offered by ing company described above.) Identifying a simple view of HR data (which tells com- critical workforce segments is the first step panies what problems they already have) in setting priorities and talent investments. to identify leading indicators, based on a Focusing on critical workforce segments broader range of workforce-related data, that allows executives to allocate resources to can help companies predict and develop solu- various employee groups based on the value tions to issues that they might experience in they generate for the business. the future. For example, a predictive model Another technique, and one with a great built from a variety of data elements — any- deal of upside, is the use of “workforce thing from an employee’s amount of overtime22
  23. 23. The Talent Paradox: A 21st century talent and leadership agendato the length of his or her daily commute an experience-based approach to determineto the turnover rate for similar jobs in the certain aspects of new nurses’ benefits pro-region — can quantify the likelihood of and grams, making it a more attractive employer topredict reasons for an employee taking a par- mid-career nurses who could now take jobs atticular action, such as leaving the company. the hospital without being penalized for theirAn employer can then use these insights to lack of longevity.proactively address impending talent issues. Executives also conducted a hospital-wide survey that asked employees to rate not onlyThe expanded universe in action their satisfaction with various aspects of their rewards programs but also the importance Companies across a range of industries are of each element — base pay, 401(k), time off,beginning to integrate this broader range of training and development, and so on — toapproaches — talent-based, work-based, core, their level of engagement. Separately, thedifferentiating, and catalysts — to design talent hospital evaluated both the cost and the effec-solutions to more directly address business tiveness with which it delivered each rewardschallenges and strategies. element. Putting the pieces together, the hospital was able to reduce spending on severalTalent dialogue drives more high-cost rewards elements that employeesbang for the buck perceived as relatively unimportant, and A large regional U.S. hospital needed a new reallocate the money saved toward improv-talent strategy to match a new set of growth ing other elements that were more importantand quality goals. To execute its strategy, the to employees but were being delivered lesshospital had to deliver outstanding medical effectively. One of these opportunities involvedcare, which meant that it needed to become scaling back certain health and welfare benefitsthe region’s leading choice for health care while enhancing training and career develop-employment, especially for highly trained and ment programs. Another was to restructure themid-career nurses. But executives also knew disability coverage program to provide uni-that controlling costs and improving profit- versal disability protection while reducing theability would be critical to the hospital’s ability likelihood of employees’ accumulating moreto attract affordable financing for its planned coverage than they could use.expansion. The hospital would have to find a Thanks to the detailed input it obtainedway to significantly increase its attractiveness through talent dialogue, the hospital was ableas an employer without increasing overall total to reconfigure its rewards programs to improverewards costs. attraction and engagement without signifi- Executives decided to seek guidance from cantly increasing total rewards costs.the source: their employees. Multiple inter-views and focus groups with critical workforce Global mobility for global leadershipsegments helped identify several changes that Top executives at one global companywould improve job satisfaction and engage- know that it needs leaders with a world-span-ment without necessarily increasing costs. ning perspective. Every year, the companyFor example, to accommodate the career spends nearly US$100 million to supportaspirations of nurses who wanted to rise on international job assignments, not just as athe pay scale without moving into manage- way to get the right people to positions inment positions, the hospital designed a career more than 100 countries, but also to givepath for bedside nurses that allowed high- promising talent the international experienceperforming nurses to advance in the organiza- and global perspective they need to lead ation while remaining in patient care roles. The worldwide organization.hospital also moved from a tenure-based to 23
  24. 24. Talent Executives worried, however, that the An “alternative” solution global mobility program was not deliver- to a “real” issue ing the development benefits the company Ask most executives how to cut real estate needed. Fully half of the program’s annual costs without shrinking headcount and they’ll international assignment budget went to sup- probably tell you to move to a cheaper loca- port assignees who fell outside the company’s tion, double up personnel, or rebuild using target talent profile. What’s more, in many smaller offices and cubicles. But that’s not how cases the jobs people were being sent to fill one global financial services company sees it. not only had alternative local talent solutions, As part of an enterprise-wide reengineering but didn’t align with assignees’ development effort, the company is targeting real estate cost needs. Most troublesome of all, the company reduction through a large-scale alternative and had no formal procedures to evaluate the mobile workplace program. Executives expect impact of an international assignment on an this program to not only drive significant sav- assignee’s development. ings from shedding excess office space, but also To better use global mobility as a develop- improve employee attraction and retention, ment tool, the company created a program increase productivity, and support the compa- that identifies high-potential leadership ny’s corporate responsibility and sustainability candidates, evaluates their development efforts by reducing its carbon footprint. Above needs, and places them in positions across all, they hope to reinforce a performance-ori- the global organization that will help them ented culture that focuses on what people do, gain the skills they need to take on leader- not where they do it. ship roles. One of the essential attributes the Combining an analysis of high-cost real company has identified for successful global estate areas with a detailed examination of leaders is “having a global mindset,” and an job function, business suitability, and cultural international assignment is mandatory for norms around work flexibility, mobility and all participants in this new career path. A choice, the company identified a target pool structured decision-making process helps of about 35 percent of its employees in loca- senior leaders systematically assess the fit tions around the world to participate in the between program participants and open posi- program. These employees are being offered tions, and the program actively measures and a variety of options for remote and mobile evaluates how effectively each job placement working based on their preferred work style, shaped each employee’s development. their job responsibilities, and the company’s These changes have put strong execution real estate goals. In a parallel effort, the com- capabilities behind the company’s strategic pany’s IT infrastructure is being standardized view of global mobility as a talent investment. in a way that will enhance employees’ ability The proportion of international assignees to work from any location. To help make the fitting the company’s target talent profile has cultural shift to the new work environment, increased, and the total cost of the program affected employees and managers will receive has decreased by 15 percent as assignments training on how to work in, manage and evalu- involving people outside the target talent ate virtual teams that might include members profile have ended without being renewed. from a variety of locations, cultures and back- Most importantly, the organization is now grounds. The entire effort is being backed by a able to effectively develop the leaders it needs comprehensive communication package that with the right skills and perspectives to create ranges from simple executive memos and proj- innovative opportunities and drive growth in ect Web sites to videos and town hall meetings. new businesses and geographies. The ongoing shift to a more mobile work- place has required a high degree of collabo- ration among the company’s corporate real24
  25. 25. The Talent Paradox: A 21st century talent and leadership agendaestate, IT and HR departments. The project advantage of a much wider range of tech-leadership team includes the COO of real niques than many companies currently use.estate, a global HR executive and a global IT Some parting perspectives to consider onexecutive who work closely together to coor- ways to put this expanded universe of solutionsdinate the required technology, talent and real to work:estate activities. To further drive the necessary Talent is a business problem, not an HRcross-functional involvement, the company problem. To have an impact on businesshas developed a detailed implementation guide issues, talent strategies need to start withthat describes the specific responsibilities of business issues — not with employee life-real estate, IT and HR professionals in each cycle issues. For precisely this reason, in fact,local rollout. And to hold all relevant stake- some CEOs are appointing business leadersholders accountable for progress, the project’s outside HR to head the talent function. Butoutcome metrics include not only the extent no matter who leads talent, the business chal-of real estate savings, but participation rates, lenges should always be front and center.technology deployments and other metrics tied Break down silos. Many innovative solu-to each business unit. tions, especially work-based solutions, require Begun in late 2007, the alternative work- close collaboration between functions toplace effort is expected to yield overall run deliver effectively. In fact, one reason rela-rate savings of hundreds of millions of dollars tively few companies apply work-based talentper year by 2011. Management also expects approaches is that the talent group typicallythe benefits to employees — reduced com- lacks enough visibility into operations tomutes, greater control over work schedule and develop appropriate solutions and the author-location, and a focus on the “what” of work ity to make operational changes. A clear exec-rather than “when” or “where” — to improve utive mandate, supported by multifunctionalthe company’s ability to attract and retain metrics and an explicit statement of eachemployees who value flexibility. Productivity is function’s responsibilities, is often needed toexpected to increase due to decreased commute foster the appropriate collaboration.times, improved employee ability to use tech- Focus on critical workforce segments.nology, and a work environment that accom- A surprising number of companies spreadmodates different work styles and needs. Finally, their talent programs across all groups ofthanks to its smaller physical footprint and the employees like peanut butter. Not only is thisreduction in employee commutes, the company expensive, but it may also leave the company’sexpects this initiative to help in its efforts to most valuable and critical workers vulnerablereduce total carbon emissions by 10 percent and looking for opportunities elsewhere. Forby 2011. every business and every business strategy, there will be specific critical workforce seg-Toward an integrated talent ments that deliver disproportionate businessmanagement strategy value and that should command the lion’s The acute talent and business issues facing share of a company’s attention and resourcescompanies today require an approach that when designing a talent management strategy.provides new dimensions for solutions. A Recognize when “good enough” really isframework that includes both talent-based good enough. In certain areas, being good,and work-based approaches, organized not great, may be enough. Executives shouldaround core and differentiating solutions, can carefully choose the nature and amount of ahelp business leaders develop an expanded company’s talent investment to deliver a val-talent management strategy that takes ued premium for critical talent without over- spending on elements that are less important. 25
  26. 26. Talent Not all talent solutions require the same level in every working day. If the covert messages of investment. transmitted by these factors don’t coincide Innovate to differentiate the employer with the company’s explicit talent manage- brand. In a world where the demand for ment efforts, employees may conclude that skilled workers is greater than the supply, the company isn’t willing to “walk the talk” employers have to give critical talent a very — and they’re likely to leave. Companies that good reason to work for them, stay with master the twofold challenge of building a them, and come back to them. That’s why broad-enough infrastructure to provide the innovative, talent-centric approaches, such backbone for their talent efforts, while tailor- as the catalysts described previously, can ing infrastructure investment to be just “good make the difference between a so-so talent enough” in table-stakes areas and excellent strategy and one that consistently delivers on in areas that differentiate the company, will its business objectives. Every company has multiply the power of their talent solutions in a strategy to delight its most important and supporting their business strategy. valuable customers in order to keep them in a “Insanity,” as Albert Einstein is credited long-lasting, mutually beneficial relationship. with saying, “is doing the same thing over and Innovation and talent-centricity can help over again and expecting different results.” employers do the same for their most impor- A broader approach to talent management tant and valuable talent. — one that incorporates talent and work Build the right talent infrastructure for approaches, core and differentiating solu- your talent strategy. Much of the talent tions, and catalysts — can help companies infrastructure in use at companies today was avoid such insanity in their talent efforts. By built to administer HR — not to engage and considering the expanded universe of possible develop talent. To accomplish the latter, it talent solutions, executives can take advan- is important to recognize that “talent infra- tage of a much broader range of approaches to structure” includes more than HR technol- help create effective talent strategies that more ogy and service delivery. It also includes the directly drive business results. technology that supports all aspects of work and collaboration, the change management Originally published in and communications capabilities to engage Deloitte Review #4, 2009 employees, and the attitudes and values of the larger corporate culture, including factors About the authors such as ethics, corporate responsibility and sustainability, diversity, and leadership. Why? Jeff Schwartz and Andy Liakopoulos are The work employees do, the tools they use, principals with Deloitte Consulting LLP. the people they work with, and the leaders they work with are the sea employees swim26
  27. 27. The Talent Paradox: A 21st century talent and leadership agendaEndnotes1 “Talent at the Table,” Personnel To- day, March 4, 2008, pp. 20-21.2 Deloitte Development LLP, “Rewards Revisited: From ‘Me Too’ to Value Driver,” 2006. Avail- able online at <http://www.deloitte.com/dtt/ cda/doc/content/us_consulting_hc_chro- book3rewardsrevisited_090508.pdf>.3 Cathy Benko and Anne Weisberg, “Mass Career Customization: Building the Corpo- rate Lattice Organization,” Deloitte Review, summer 2008, pp. 50-61. Available online at <http://www.deloitte.com/dtt/article/0,1 002,sid=153749&cid=216046,00.html>. 27
  28. 28. TalentWhere Did Our Employees Go?Examining the rise in voluntaryturnover during economic recoveriesBy Bill Chafetz, Robin Adair Erickson and Josh Ensell> Photography by David Clugston F ast forward to smoother seas after the current economic storm: your company has survived. You made the hard decisions regard- Executives may be tempted to think that their current actions are having no effect on the retention of their employees since volun- ing layoffs, expenses, and closing facilities to tary turnover rates have been low throughout improve operational performance and short- the downturn. However, their actions may be term earnings. Like your peers, you made actually increasing turnover intentions with cutting and managing costs your number one many employees planning to jump ship once strategic priority while pushing focus on man- the economy improves. To prevent the loss of aging human capital to the back of your mind. talent typically seen during economic recover- But unfortunately this turns out not to be ies with a resulting “resume tsunami,” leaders the whole story. must avoid making mistakes that increase employees’ turnover intentions. A downturn, A turnover intention is an employee’s “conscious and deliberate willfulness to leave the organization” within a certain time interval, e.g., the next six months —— (Tett and Meyer, 1993)28

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