Why a short-term approach to talent management doesn’t work anymore

It’s time employers get better at sourcing their own talent and actively developing their employees’ skills, two authors wrote in a blog from Harvard Business Review.

“For decades, companies have adopted a short-term, ad hoc approach to talent management — and it’s increasingly obvious that this is a problem with profoundly harmful implications for the economy,” the authors wrote in the blog, Manage Your Talent Pipeline Like a Supply Chain, published Nov. 22. “That’s especially in the current Great Resignation moment, as companies are struggling to find the skilled workers they need.”

Once you lose workers, they don’t just reappear, wrote Joseph Fuller and Matt Sigelman. Fuller is a professor of management practice and a co-chair of the Project on Managing the Future of Work at Harvard Business School. Sigelman is CEO of Emsi Burning Glass and the president of the Burning Glass Institute, which advances data-driven research and practice for the future of work and workers.

To return to a healthy balance of jobs and people, employers need to move beyond the ad hoc strategy that most companies have been employing to source their talent. This involves treating your P&C talent pipeline like a supply chain.

“With supply chains, you get what you plan for,” the blog said. “Think about, say, ball bearings. To ensure a ready supply, Ford coordinates with its suppliers years in advance. How would it work if the company were only to coordinate with those suppliers on a short-term basis, reaching out at the beginning of each month to source only what it needed for the next month? Anybody with even a rudimentary grasp of business will recognize that idea as absurd.”

Yet, this ad hoc approaching to sourcing is how most companies today are trying to meet their demand for talent, wrote Fuller and Sigelman. Instead, they recommend these three approaches:

Employers must work actively to draw from a broader talent base

In part, this means recruiting from a wider set of geographies. Some candidates with unconventional backgrounds may not have all the skills needed for the job. Can the rest be trained?

Employers will also need to re-evaluate job requirements to determine which are truly necessary and which are “nice to have.”

Employers must invest in “growing their own”

In many companies, employees find that the best way to move up is to move out, driving up turnover. The blog authors said that employers need to invest in their workforce in the same way that they invest in R&D, by recognizing that near-term investments yield earn long-term returns.

“Workers can’t be trained overnight, so companies should invest in preparing them as soon as it becomes apparent that important new skills are emerging,” wrote Fuller and Sigelman. “It will always be wiser to have too much talent, too early, than to being reduced to playing the spot market. Building from within also means showing workers how they can move up within the company, giving them a reason to think twice about the attractiveness of jumping ship. The best companies make planning for promotion a part of each performance review.”

Employers need implement fundamental principles of supply chain management

In the case of talent, these are often community colleges and technical training academies. As with other suppliers, companies need to share detailed job specifications with colleges, meet regularly with them, provide them with access to relevant experts and technology, discuss their emerging requirements, evaluate their reciprocal performance, and offer data-driven feedback.

 

The blog noted that ever since the 1960s, there’s been a slide toward increasingly transactional employment relationships, “with the expectation being that companies can hire and fire at will.” In this kind of environment — where there are no pensions, commitments to training, or promises of employment stability — workers naturally change jobs whenever better opportunities present themselves.

“Some observers argue that such a model offers greater efficiency and flexibility. That may be true, but the ability to staff up on demand depends on the availability of willing workers — a resource that, thanks to the Great Resignation, we only have in very limited supply today.”

 

Feature image by iStock.com/alvarez