We can’t overestimate how important a talent management strategy is for today’s companies.
Labor is very often the largest cost to any business, with Deloitte estimating it at between 50-70% of company spending.
A talent management strategy means that this money is being spent wisely. Let’s go over what talent management involves, and set you up for success with some best practices.
What does a talent management strategy include?
There are multiple stages of a strong talent management strategy (TMS).
It starts with identifying the talent that you need, what types of talent are missing across the company, then finding the best way to hire and train the talent, as well as developing and retaining talent to your best advantage.
Where necessary, you also need to consider making redundancies or firing talent when things aren’t working out.
SImply put, your TMS will lead HR and other departments when they develop processes for hiring, training, management and retention.
The best TMS will bring together the goals of the company with the personal development objectives of the talent themselves. You want to find a way to marry these two together.
When that happens, you’re supporting the company, while also providing the talent with the right roles and experiences. It’s a win/win. What does success look like? Each member of your workforce is given what they need to progress and develop, and the business thrives right alongside.
Best practices for creating a TMS
There are several points to consider when creating your talent management strategy. Here are a few of the best practices we’ve seen in the market.
#1 Talent goes beyond your employees
Non-payroll workers are set to make up the majority of the workforce within the next few years. That means your TMS needs to look beyond the names on the monthly payroll.
Your full-time and part-time employees are important, but you also need to think about independent contractors. If you don’t adjust your processes to allow you to hire, train and retain freelancers, you’re losing out on a large slice of that talent pie.
#2 Develop your strategy based on your company’s goals
What are your company’s current goals and objectives? Whatever your answer, this is a good place to begin when building out your talent strategy.
For example, if your company is focused on global expansion, you’ll need to look for talent in specific regions.
If you’re a public company with poor ESG reports, you may need to focus on diversity to get more cultural voices around the table.
If your company is going through hypergrowth, you’ll want to consider knowledge transfer, and hire skilled talent with industry-specific knowledge that can hit the ground running.
If you’re looking to implement digitization, you may have specific gaps in cloud, IT or AI.
The following four steps can be a helpful process to ensure your talent strategy aligned with your company’s business goals:
- Identifying goals – What are your company’s main objectives in the next 12-18 months? What type of talent will your company need to accomplish these goals?
- Isolating gaps – What’s standing in the way of reaching those objectives? Note that you need to focus on skills and not people in order to be able to properly identify your skills gap.
- Address the missing pieces – How can HR help bridge the skill gap? Is it an issue of expending the talent pool or maybe offering more flexible work engagements? You need to think big and step outside the box at this point.
- Policy creation – What new processes and workflows can be put in place to support HR’s above goals?
#3 Set priorities, and adjust on the fly
It’s really important to set specific priorities for your TMS. According to Gartner, the top HR priority in 2021 was hiring around skills rather than specific roles.
If this is your goal, leaders should be looking to identify the specific skills that are missing, allowing HR to support teams in creating new processes, which in this case may be writing new job descriptions or identifying the right talent pools that fill those gaps.
Remember, your company’s values are really important, but they aren’t set in stone. Don’t be afraid to adjust your values or your goals in line with what you can achieve.
For example, you might want to be known as a company for your ability to always hire the most experienced person in the room. However in reality, the budget just isn’t there for such a strategic hire this quarter. Can you shift your strategy to allow for a more affordable candidate, and then offer training and development that gets the new hire up to speed on your industry expertise?
#4 HR should support talent, but also the managers
The goal of the Human Resources team is to support talent in doing their jobs. Unfortunately, sometimes HR forgets that there are other stakeholders involved in the decisions that they make. If HR processes focus solely on the experience and workflow for the talent, they can forget the managers who are leading the process.
This rule works no matter which part of talent management you’re considering.
When thinking about hiring talent, spare a thought for the hiring managers who are juggling multiple open roles.
When working through the annual feedback process, remember that it’s not just about the individual giving the feedback, there are also front-line managers who need to collect and understand feedback from their entire team.
It’s not only about paying talent on time, it’s about the finance team who need clarity over the organizational budget.
In short? Policies and workflows aren’t just for the talent. They also need to support all the other departments who are working with individuals, whether that’s procurement and hiring managers, IT, Legal, Finance and more.
#5 Track, measure, and gather feedback
Finally, your talent management strategy should never be complete. Once you get to stage 4, where you’re implementing new processes and policies – it’s time to measure. There is always room for improvement!
There are a number of ways to measure talent management, for example comparing retention before and after implementing new L&D opportunities, or comparing time to hire or successful onboarding once you tweak interview processes or job descriptions.
Don’t forget to ask talent for anonymous feedback at critical stages, whether that’s after their first 30 days on the job, at the 1-year mark, or even when they are leaving your company. New employees won’t let HR know directly any problems they’ve had, so a process for blame-free feedback can be priceless.