Following is a summary of “Talent management for the 21st Century” published on March, 2008, Harvard Business Review, pages 76-81.
At its heart, talent management is simply a matter of anticipating the need for human capital and then setting out a plan to meet it.
Ineffective talent management:
- Do nothing and anticipate no needs
- Rely on complex and bureaucratic models from the 1950s for forecasting and succession planning
New approach: Use supply chain management models
How We Got Here
- 1950s – long-term succession plans that attempt to map out careers years into the future
- 1970s – internal talent development collapsed because it could not address the increasing uncertainties of the marketplace.
- 1980s – recession => white-collar layoffs => demise of lifetime employment => “if the priority was to cut positions, particularly in middle management, why maintain the programs designed to fill the ranks?”
- 1990s – Companies attracting experienced candidates and losing experienced employees to competitors at the same rate.
A New Way to Think About Talent Management
Since the 1980s, companies have instituted, and continually refined, just-in-time manufacturing processes and other supply chain innovations
Talent-on-demand framework principles:
- Make and Buy to Manage Risk – the risks of overshooting talent demand forecast are greater than those of undershooting, so undershoot and hire when needed
- Adapt to the Uncertainty in Talent Demand – hire is small, frequent batches, break up a long training programs into discrete parts, create talent pools that span divisions
- Improve the Return on Investment in Developing Employees – get employees to share in the costs, ask employees who are about to receive training to sign a contract specifying that if they leave the business before a certain time, they will have to pay back, attempt to hang on to employees even after they leave
- Preserve the Investment by Balancing Employee-Employer Interests –
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