What’s Your Attitude About Talent?

Has your company ever rejected a job candidate with an impeccable resume and impressive performance track record because their workplace values and behaviors clashed with those of your organization? Has your company ever fired a high performing executive because they burned through the people who worked for them? If you answered yes to either of these questions, you work for a company with an ‘attitude’ about talent. Performance alone doesn’t cut it. Having loads of skills and oodles of experience is not enough. You demand something more – those intangible qualities, only demonstrated through behaviors that show a person really ‘fits’ with your company and its culture. Most importantly, you employ a talent management system that ensures people with the right blend of characteristics for your organization are continuously hired, motivated and developed.

Some companies treat talent management as a process for getting the most out of people while expending the least effort and resources. This approach may work nicely with financial capital and physical assets but it is usually counterproductive with humans. Others see talent management as primarily about appraisal and reward - a process that directs the lion’s share of pay and perks to the top echelon of performers. The rest must either shape up or ship out. But this approach can be highly divisive and lead to debilitating conflict and resentment within the organization.

Companies with an attitude about talent believe the purpose of talent management is to build and sustain an organization of individuals who not only execute the business model and strategy well but exemplify the culture, values and behaviors the organization values most. They employ a well-designed and reinforcing system of management practices that meld together people with diverse skills and complementary behaviors in ways that deliver high fulfillment to workers and outstanding performance for the organization.

Want to develop the right attitude about talent and create a system that puts it into practice in your company? My research on companies with consistently high performing talent suggests several key elements of a successful system:

Identifying and Attracting Talent – The recruiting approach is meticulously matched to the interests of the people sought. Success depends most on knowing the target – understanding in detail the attributes most desired in the people sought and having the patience to wait until they are found or developed. Electronic Arts and Cisco for example personalize their approach to recruiting by targeting individual candidates and tailoring their communications and interactions to them.

Hiring and Inducting New Workers – Fit is the top priority before and after talent is brought on board. Hiring twenty people to find five keepers is viewed as wasteful and expensive. Explicit criteria are used to screen and evaluate candidates, validate their professional and personal skills and attitudes, and test a candidate’s abilities, experience and behaviors.

The fit process doesn’t stop once someone is hired. It is instead extended several months after a candidate joins and its emphasis is broadened to include not just validating the candidate’s credentials but ensuring that new hires are quickly integrated into the workplace and made comfortable and productive. Trilogy Software for example, has created a boot camp for new hires that provides them with a deep immersion into both the work and the culture of the company.

Leveraging and Developing Talent - Ordinary companies ‘talk’ empowerment but ‘walk’ command and control. Companies with a talent attitude give employees a share of ownership and decision authority, make sure workers understand the big strategic and operating picture and how what they do affects it, and allow them freedom to choose what, when, where and how they work. They also pay lots of attention to the growth and development of staff. Development is viewed as a series of experiences. Knowledge transfer and learning among peers and between managers and staff is a top priority. W. L. Gore & Associates for instance, employs an open environment in which employees at all levels can apply for funding to projects. New staff are assigned mentors from Day One to coach their development and performance paths.

Appraising and Rewarding Employees – Performance measures and rewards are used to reinforce not drive behavior. Pay and benefits are viewed as important but the bulk of the efforts are concentrated on non-monetary factors that positively motivate people to perform. A mix of timely recognition and rewards are employed. Intuit for example, uses personalized recognition and awards to convey to employees that they are appreciated and that they really matter to the company.

Building and Sustaining Relationships With Workers - Relationships are developed and nurtured with everyone in the workforce. This talent relationship management effort involves a continuous and dynamic process that develops long-term, individualized relationships with talent during and after they are “employed” by the organization. Gensler for example, keeps up relationships with staff that leave and welcomes them back whenever possible. It views rejoining employees as sources of new knowledge and fresh ideas that can be injected immediately into the organization.

2005 Outlook – More of the Same Change

It’s a new year and a new beginning for executives, workers and community economic developers. What key trends will shape their agendas in 2005? Here’s my take on the issues that are near and dear to my research and consulting work.

GROWTH AND INNOVATION MAKE A COMEBACK – Cost-cutting isn’t going away but companies will be increasing their attention on finding ways to grow and innovate, albeit in a ‘lean’ manner. They won’t want to spend too much money or take big risks. Smart companies as they always do will find smart ways to grow. And they will not shy away from taking significant risks when they make sense. Others will continue to look for big wins on the cheap.

MERGERS AND ACQUISITIONS RESUME – M&A activity in 2004 quietly reached record levels. Analysts and Investment Bankers predict an even better year in 2005. The drivers in some industries will be consolidation (telecoms, software for example), but in many others it will be growth and innovation. Given the dismal track records of M&A – various research studies estimate 55-70% fail to increase shareholder value for example – buckle your seat belts. We may be in for a rocky ride.

GLOBILIZATION AND OUTSOURCING CONTINUE UNABATED – These trends will continue to pick up steam and in 2005. The cost allure of offshore outsourcing will remain too hard to resist for many companies. And the unrelenting hype machines of vendors, consultants and venture capitalists will ensure that outsourcing is front in center in the minds of top executives here in the U.S. While there are beneficial aspects to these trends, they have significant downsides as well. One is the impact on this country’s human capital. It remains to be seen whether our corporate and political leaders will focus any attention or urgency on developing and repurposing our home grown talent. Years of neglect and underinvestment in human capital has left too many organizations operationally lean and mean, but strategically emaciated and feeble.

TURNOVER RETURNS – Look for the U.S. labor market to continue its slow recovery. There are some signs pointing to a pickup in the pace of turnover and new hiring this year. Productivity gains slowed toward the end of 2004. This suggests that companies have wrung out just about all they can from existing workers. Many of those remaining will be tougher to replace via outsourcing or automation. Hiring new talent will be needed to support even moderate growth this year. Headhunters are reporting increases in activity. This means new jobs are opening up as many individuals leave for greener pastures.

BOOMERS BOLT - Look for Boomers to continue to flood the entrepreneurial ranks. If you want to keep them (and demographic trends suggest you will need to) then be prepared to offer them the right mix of flexibility, challenge and rewards. All-or-nothing approaches to employment particularly for those nearing retirement age simply won't cut it. Many older workers want to continue to work, indeed many will have to, but continuing in high pressure, all consuming roles is not an option they care to pursue. They want to do something fresh and new that allows them to draw on their deep knowledge about their work, their field of expertise, their industry and their company and its culture. New roles need to be created that keep older workers involved meaningfully but which also offer significant flexibility and choice in when and how much they work. Mentoring, consulting, and project-based assignments appeal to older workers burned out by the grind of full-time work but not ready for retirement.

GEN Y STEPS IN, GEN X STEPS UP - The ranks of young talent are not growing as fast as older workers and in the case of 35-44 year olds they are shrinking as a percentage of the workforce. These groups represent the new generation of workers and leaders and Corporate America needs to engage them. But is it? Are companies setting the example that youth seeks? Many want socially- responsible, people-centered and sustainable workplaces. The rhetoric of corporate America about the importance of human capital sounds good. Conversations with individual executives leave one feeling that many 'get' it. Yet old behaviors die hard.

SMALL AND MEDIUM ENTERPRISES RULE - SME’s are where the action will continue to be in the economy both nationally and locally. SME’s produce the bulk of the new jobs and in many cases the new ideas and innovations that create future growth for the economy. Some even become dominant companies or create tomorrow’s industries and hot markets – e.g. Microsoft, Dell, Apple, Whole Foods, Starbucks to name just a few were all small startup businesses not so long ago. These are merely the biggest and best known success stories. There are literally thousands of smaller but highly successful small companies growing leaps and bounds and generating new jobs and new growth. See http://www.inc.com/resources/inc500/index.html for Inc. magazine’s list of 500 of the most dynamic small companies in the U.S.

That’s my take on the outlook for 2005. Time will tell how accurate my predictions are. No doubt a few surprises await us just over the horizon. Stay tuned.