TALENT MANAGEMENT REDEFINED PATRICK HAUENSTEIN, PH.D. PRESIDENT, OMNI LEADERSHIP The Right Person In The Right Position At The Right Time... Every Time OMNI LEADERSHIP620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com
TALENT MANAGEMENT REDEFINED Patrick Hauenstein, Ph.D. President, OMNI LeadershipThe Historical Definition of Talent ManagementThe term Talent Management was first coined in an often cited 1997 article by McKinsey whichfocused on the emerging “war for talent”. Popularized in the 2000’s, various pundits have offereda definition. Dr. John Sullivan, a popular expert on the subject, suggested in a 2004 ElectronicRecruiter Exchange article that four key factors distinguish Talent Management from traditionalHR approaches: 1. An integrated approach within HR 2. Integrating people processes into standard business processes 3. Shifting responsibility to managers 4. Measuring Success with productivityThis definition has changed very little in the past decade as evidenced by the various referencescited over the course of the second half of the decade: Trends in Human Capital Management: The Emerging Talent Management Imperative… Knowledge Infusion White Paper July, 2006 “The process of managing the supply and capabilities of the workforce to meet the demand for talent throughout the organization to achieve optimal business performance and in direct alignment with organizational goals.” The Official ASTD Blog May 8, 2009 “A holistic approach to optimizing human capital, which enables an organization to drive short and long term results by building culture, engagement, capability, and capacity through integrated talent acquisition, development, and deployment processes that are aligned to business goals.”It became clear that a central theme of talent management definitions was a focus on integratedcore processes. Talent management was being seen as synonymous with integrating core HRtalent processes. New Talent Management Networks (NTMN) annual talent management report cited in HBR Answer Exchange 5/24/2010 “…companies define talent management largely as consisting of succession planning, high potential identification and development, assessment and feedback, and career planning/development.”
Technology Support and Reinforcement of the DefinitionThe advent of Software as a Service (SaaS) drove an inflection point in the growth of theTalent Management technology market. The market wanted easy and fast access to technologythat would help them move toward this exciting concept of integrated Talent Management.Guided by the accepted definition, with it’s central focus on talent processes, technologyvendors developed integrated automated processes focused on talent acquisition, performancemanagement, development, and succession. The technology vendors focused on automating thecore talent management processes that were seen as being at the core of Talent Management.The market philosophy of the technology vendors is illustrated in the graphic below: Core Talent Processes: Performance Mgmt. Business Strategy Hi Po Identification Business Results Development Succession Talent AcquisitionThis model positions automated processes at the center of Talent Management, sandwichedbetween bookends of business strategy and business results. The basic message is to align yourcore talent processes to the talent needs of your business strategy in order to drive businessresults.While these solution platforms have contributed substantial efficiency gains through processautomation, there is reason to question whether they have also made contributions to increasingtalent management effectiveness.Additional Components Needed for Effective Talent Management1. Talent Measurements – The basics of a Talent System of RecordYou cannot manage what you cannot measure. In order to improve Talent Managementeffectiveness, you need to establish a system of record for talent assets that includes proven andreliable talent measurements related to successful performance. Sadly, the concentration onprocess automation has neglected generating the talent measurements needed for effective talentdecision-making.
The data deficiencies of talent management solutions have been noted by industry analysts: “The big problem with HCM (Human Capital Management) applications is the data. Companies do not have the content or data to understand who their best people are and why” (ThinkEquity 2008 Industry Report). The graphic below suggests the types of talent measurements that are needed to establish a talentsystem of record that supports effective Talent Management. In order to generate this record,a broad range of fully integrated assessment and evaluation tools are needed in the TalentManagement solution. Data That OPTIMIZING HUMAN BUSINESS INFORMATION Predicts Leader Performance Success Measurements Competency Experience Measurements Measurements Talent Key Measurements Interview Accomplishments Ratings The Basics of a Talent System of Record Cognitive Ability Career Preferences & Motivation Measurements Measurements Personality Measurements2. Analytics – Decision Support Reporting for ManagersOnce a talent system of record has been generated, it is critical to leverage those measurementsthrough thoughtfully designed analytics that drive and inform the talent decisions made bymanagers. Effective Talent Management requires going beyond automated processes topresenting line managers with reliable information in a format that supports evidence-baseddecision-making. On demand reporting should help managers answer the four basic talentdecisions that need to be made for any pivotal talent pool: Who are my top performers both in terms of results achieved and how those results were achieved? Where do I focus individual and group development efforts to maximize ROI? Which of my top performers also possess high advancement potential and where should I focus career development efforts? Which of the high performing high potentials are ready now for a higher level of responsibility?
Analytics are used to manipulate and leverage the core measurements needed to answer thesequestions. As an example, consider the identification of individuals with advancement potential.Many talent management solutions simply provide the ability in their automated processes tocapture subjective judgments of advancement potential from managers or others. An analyticsreport would leverage and integrate core measurements to provide a more accurate estimate ofpotential. This approach is illustrated in the integration model below:In this model, personality measurements, cognitive ability measurements, competencymeasurements, and experience measurements are combined with advancement interests toproduce an accurate measurement of potential.3. A Common Language for Defining Success - Fully leveraged and integratedcompetency models, experience models, trait models, and motivation/preferencemodelsCompetency models are at the heart of an integrated talent management solution. They provide acommon language used across core talent processes and describe the behaviors associated forsuccess for any given position in the organization.An effective talent management solution should be able to support and drive custom competencymodels as well as offer rich native competency content for all levels of positions within anorganization. An effective competency model would have the following key content components: Competency Label Definition Key Behaviors Performance Standards Interview Questions Development Guides
While competencies are a key component of an integrated talent management strategy, successprofiles for positions need to be more comprehensive than just competencies. A commonlanguage is also needed for defining experience requirements, key traits, motivations, andtechnical/functional requirements. A common language allows companies to create positionprofiles which can then be scientifically compared to the talent system of record to quantify thedegree of match between a given individual and a specific position as illustrated in the examplebelow: MATCH REPORT Match Report on: 9/1/2010 Talent: #3778 - Susan Kadecky Position: #1082 - CIO Match Details Percentage Overall Percentage Match 71% Background Elements 100% Position Characteristics 78% Experiences 36% Competencies 80% Personality 77% Cognitive Test Percentage Numeric 89% Abstract 96% Talent Management RedefinedJohn Sullivan’s original suggested key factors for characterizing and defining talent managementwere accurate but deficient to fully differentiate strategic talent management from traditional HRpractices. We have suggested three areas that should be integrated into the original list. Wesuggest that Talent Management should be redefined in the following manner: 1. An integrated approach within HR based on a common language for defining and profiling success (e.g., competencies, experiences, behavioral predispositions, work preferences, etc.) 2. Integrating people processes into standard business processes 3. Establishing a talent system of record containing key talent measurements 4. Shifting responsibility to managers and equipping them with comprehensive decision support reporting capabilities to make key talent decisions 5. Measuring Success with productivityThese modifications incorporate the three key additions of talent measurements, reportinganalytics and rich underlying content needed to complete the components of effective TalentManagement.
We hope that technology vendors will likewise align their solutions to this redefinition of TalentTechnology vendors need to migrate from efficiency plays to actually driving Talent Managementeffectiveness. The market model for technology based Talent Management solutions should beamended as follows: Core Talent Processes: Performance Mgmt. Business Strategy Hi Po Identification Business Results Development Succession Talent Acquisition The Foundations of Talent Management: Talent Measurements, Analytics, Common Language for Defining SuccessWithout the addition of these key foundational components, it is legitimate to asktechnology vendors, “Where is the beef?”