Businesses are always keen to gain a competitive advantage. More than innovative products and successful marketing campaigns, It is the talented workforce that creates a remarkable impact. However, with the prevailing volatility in the business spectrum, the ability to attract, develop and retain talent is becoming challenging. However, to retain and nurture their most important asset, businesses need a robust Talent Management Strategy in place.
Efficient and focused Talent Management Policies are ideal for both – employees and organizations. Businesses having effective Talent Management Strategies outperform their competitors in many ways. People often correlate Talent Management to Talent Acquisition, but both these terms are entirely different. Let’s get familiar with Talent Management in HR in depth.
What is Talent Management?
Talent management is a strategic function of HR that enables a business to attract, develop, inspire and retain highly skilled employees.
It is an ongoing process, involving many crucial functions such as recognizing talent gaps, sourcing suitable candidates, nurturing their talent with training and development (T&D), motivating them and retaining them to achieve organizational goals. Organizations can create a sustainable competitive edge with their Talent Management Practices which are difficult for others to copy.
How is Talent Management Different from Talent Acquisition?
Talent Management and Talent Acquisition complement each other. Talent Acquisition is the process of staffing and hiring qualified people. However, Talent Management focuses on developing and retaining these skilled hires. In the absence of talent management, the overall purpose of effective Talent Acquisition can fail. Mere onboarding and hiring good employees won’t be enough if organizations do not invest in their development. By investing in employee skill development, organizations unleash their potential and use it for the organization’s benefit. A good HR strategy makes the best use of Talent Management and Talent Acquisition in gaining a competitive edge in the industry.
Why is Talent Management Important?
Talent management is a necessary process that can play a differentiator role between an organization’s success and persistent failure. As per Boston Consulting Group’s Global Leadership and Talent Index: Effective Talent Management is correlated with the financial performance of an organization. Companies following effective Talent Management Strategies had a turnover that was 2.2 times higher and profits that were 1.5 times more than those with inefficient and poor Talent Management Practices.
Apart from profitability, most HR professionals agree that there is a continuous “war for skilled talent” —several job positions are vacant due to the unavailability of a skilled workforce.
So, to draw and retain top candidates with the current war, organizations must get their Talent Management Strategy right. However, retaining the trained and skilled workforce is more cost-effective than sourcing, hiring and training the new ones. This strategy keeps the attrition rates low and saves organizations from losing productivity. Moreover, in the absence of coordination between employees and your organization’s strategy, you leave your business goals to guesses.
Now let’s try to understand what practices organizations follow to meet the purpose of an effective Talent Management Strategy.
Talent Management Best Practices
Since Talent Management directly correlates with organizational efficacy, thus HR heads always strive to follow the best Talent Management Practices. Some of these practices are like this:
1. Giving Weightage to Employee Experience
By giving weightage to employee experience, organizations resolve problems and build value through enhanced performance. This practice keeps the employee turnover rate in control as managers focus on ways to motivate the experienced and skilled workforce.
2. Aligning Talent Acquisition to Organizational Goals
The alignment of Talent Acquisition strategy to organizational goals exhibits the effectiveness of an organization. Your organization’s Talent Acquisition strategy must complement organizational goals. For this, HR heads conduct induction programs for newly inducted employees.
3. Improving Training and Development Efficiency
Organizations must induce work-related training programs for newly hired employees when starting their onboarding. In addition, organizations should also implement T&D programmes for their existing employees. This increases employee engagement, removes skill gaps, and makes employees better decision-makers.
4. Clear Understanding of What Skills Organizations Need
Understanding the skill requirement for hiring is essential. HR heads can locate skills within the organization. In case they don’t get better talent within, they can look for it outside.
5. Providing Constant and Necessary Feedback
Regular feedback helps organizations maximize the performance of their workforce. This way, managers get better controls, and employees can take corrective measures to rectify any gaps if any. This practice keeps managers and employees informed regarding the shortfalls, improves communication, and makes appraisals faster.
6. Rewarding and Retaining Highly Skilled Employees
Managers must understand the motivational drivers of their employees. This understanding helps them to frame reward-based policies. Motivated employees remain highly engaged, which leads to enhanced productivity. Organizations must recognize the excellent work of their employees and encourage them to innovate and create. Positive recognition, providing benefits and promotions, and job rotations are a few ways that work well to retain skilled employees.
7. Plan for Successions
Organizations must nurture and promote skilled employees to higher career paths. Keeping your workforce informed and trained with the latest skills helps in retaining trained and valuable employees. If still, your employee wishes to move out, HR heads must conduct exit interviews. This strategy can help to frame more effective Talent Management Strategies.
People Analytics in Talent Management
Until recently, HR practices were following traditional practices, but now people analytics has put an end to this. Technology is playing a crucial role in outcast managers’ bias and intuition methods to streamline HR strategies. Now, organizations invest in many programs, data analytic platforms and tools that draw insights by analyzing data. With people analytics, Talent Management becomes more strategic with data playing an essential role in making an informed decision. Data and tools provide insights into employees’ productivity, motivation and skill gap behaviors. People analytics has made the internal mobility of employees easy. Fortunately, managers implement people analytics in real-time operations and cut down on staffing mistakes.
People Analytics creates a data-driven mindset that considers data a deciding factor in reducing employee turnover, improving employee training needs and contributing to business performance. This tool bridges gaps among leadership, talent pipelines, productivity gains and cost reduction. The contribution of people analytics is relatively high in making Talent Management Strategies effective, as organizations can counter a broad range of business challenges like attrition rates and structuring compensation policies.
Talent Management: A Skilful Differentiator
The workforce is a significant cog of every business. It is employees who engage other factors of productivity together and make the best results out of it. Thus HR managers need to strengthen their Talent Management Strategy in such a manner that can keep employees motivated and engaged with the means of training and skill upliftment. In such a scenario, when organizations are at constant war for skills, it becomes highly indispensable for organizations to work internally on their strategies so that organization comes out as a winner.
