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The changing face of talent management
THE effective management of human capital has become one of the key success factors for businesses in a highly competitive and globalising world. As businesses become critically reliant on their people to innovate and seek competitive advantages, the proverbial "war for talent" has never been more intense.
We discuss the four key themes for talent management in 2016 to help business leaders navigate the changing landscape of HR.
1. THE STRATEGIC VALUE OF HR
Strategic decision-making powers have traditionally resided with the chief executive officer (CEO), chief financial officer (CFO) and chief operating officer (COO). Increasingly, leading companies are recognising the unprecedented importance of the chief HR officers (CHRO) in strategic decision-making.
The best CHROs, apart from being technically competent in HR, have an exceptional understanding of the strengths and weaknesses of the people in their companies, and leverage this understanding to deliver strategic value to the business. They focus on developing competitive advantages by attracting, nurturing and retaining world-class talent. They are fluent in the operational, financial and risk management challenges of their companies and are able to identify the right talent to overcome these challenges.
The impact of being isolated from strategic decision-making - leaving the HR function mired in administrative or transactional matters only - can be costly.
If the HR department should focus its efforts only on administrative issues, it will quickly become an unattractive place to work for talented practitioners, exacerbating the lack of talent in HR positions, which in turn could aggravate the extent of other talent issues within the business.
2. A STRONG PURPOSE AND CULTURE
Two key demographic trends will fundamentally shape and alter how businesses need to manage and retain their people. One of these is the increasing proportion of millennials in the workplace.
American psychologist Abraham Harold Maslow believed that people have five main needs in the following order of importance: physiological, safety, sense of belonging, self-esteem and self-actualisation. The relevance of this, in relation to millennials, has shifted.
Born and raised in the post-war era of relative stability and economic vibrancy, millennials look beyond fulfilling their physiological and safety needs, and place greater emphasis on achieving self-esteem and self-actualisation. As such, having a strong sense of purpose and culture at the workplace will resonate with their desire for self-actualisation and motivate them to stay with the company.
Second, the nature of our workforce is changing due to increasing workforce globalisation and the digitalisation of work processes.
The globalisation of our workforce - particularly in Asia-Pacific as Asian-born companies seek expansion into global markets - has heightened the need for short-term and long-term employee mobility.
At the same time, workflow digitalisation has resulted in demand for jobs and skillsets that did not exist 10 years ago, such as those in cyber security and systems architecture. The challenge to get such a diverse and evolving workforce moving, growing and teaming in the same direction can only be surmounted if there is a strong sense of purpose and culture.
While the CHRO and his team can help to identify ways to enhance employee engagement and the competitiveness of the company's reward strategy, the onus ultimately resides with the company's leadership to identify a compelling purpose in everything they do - supported by a strong corporate culture rooted in the values of the organisation - in order to engage, attract and retain talented millennials amid a rapidly changing workforce.
3. HR IS EVERYONE'S RESPONSIBILITY
It is convenient to blame the CHRO and HR team for people-related issues within a company.
However, people issues should concern all managers in a company. Management is about motivating people and harnessing their potential to achieve a set outcome. Line managers need to be trained in coaching and facilitation skills in order to provide their reports with timely and constructive performance feedback, and coach them to attain higher levels of technical and behavioural competencies.
Line managers also need to take the prerogative to identify the developmental areas for their reports, and be concerned with their wellbeing by paying attention to their needs beyond the workplace.
HR should serve as an independent third party in the relationship between the line manager and his report, provide timely intervention when necessary, and align people practices with policies across the organisation. HR should also provide the necessary platforms and systems to help line managers motivate and develop their staff, such as competency frameworks, performance management systems and talent management frameworks.
Much has been written about how digitalisation and big data analytics have transformed the way businesses operate.
When it comes to people management, business leaders need to take the digital conversation a few steps further beyond the automation of HR processes and implementation of people management software platforms in lieu of pen-and-paper application forms.
First, they need to identify how the HR department can help line managers better identify and develop the agility, adaptability and autonomy that their reports will need to thrive and succeed in the digital age.
Here, HR can play a strategic role in helping line managers better contextualise the changing nature of the workplace, as well as develop and help employees adapt to new and more effective ways of working while bridging physical, geographical and time boundaries.
Second, leaders should explore how people analytics can help them better engage and retain their top talent.
This can be achieved by working with HR to identify key employee metrics to measure and capture digitally generated real-time data so as to provide timely performance feedback and illuminate management insight into their people's work preferences and level of job satisfaction.
As the dynamics of the global labour force continue to evolve, the way an organisation understands and manages its people will be closely linked to its performance.
Overcoming talent challenges will require the CEO, CFO, COO and CHRO to partner well - collaboratively and seamlessly in both mindset and action - so as to shape an effective talent management strategy that is aligned with the business agenda.
- Samir Bedi and Goh Jia Yong, are partner and senior manager, respectively, for People Advisory Services, Ernst & Young Solutions LLP.
- The views reflected in this article are the views of the authors and do not necessarily reflect the views of the global EY organisation or its member firms.