Everything you need to know about talent management
How to upgrade your employee experience in the new world of work
While the Great Resignation has motivated many leaders to prioritize recruitment and retention efforts, these are far from being the only elements of an impactful HR strategy. As priorities shift and the pressure to hold on to all-star employees intensifies, every business must have an overarching talent management approach designed to boost engagement throughout the entire employee lifecycle.
Although talent management is likely a familiar term, there’s still a lot of uncertainty about what goes into a superior strategy. And as we approach our next chapter, challenges are only going to get more complex as both business priorities and employee expectations evolve rapidly. So what does it really take to get talent management right in the new world of work?
What is talent management?
The phrase “talent management” gets thrown around a lot, but what does it actually mean? Talent management is the strategic approach employers use to attract and cultivate a highly productive workforce that is inclined to remain with the organization for the long term. According to Gartner, it’s “the attraction, selection, and retention of employees, which involves a combination of HR processes across the employee lifecycle. It encompasses workforce planning, employee engagement, learning and development, performance management, recruiting, onboarding, succession, and retention.”
To get a better picture of what talent management really is, it’s helpful to think about what it’s not. Here’s how talent management differs from a few other terms that sound similar to it:
Talent management versus talent acquisition:
Talent acquisition is about recruiting, hiring and onboarding internal and external candidates while talent management focuses on bringing out the best in your workforce and identifying the career paths and skills employees need to build to flourish
Talent management versus performance management:
Talent management is a broader term that encompasses recruitment, retention, development, and recognition, while performance management is more specialized and dedicated to measuring how employees are contributing to their organizations based on metrics and feedback
Talent management versus talent development:
While talent development focuses on how employees build skills and connections, talent management is a broader term that describes an organization’s commitment to recruiting, staffing, and succession planning.
Talent management process
Every organization’s talent management process is going to look a little different based on factors like their business priorities and the industry they’re in. However, generally speaking, the talent management process can be broken down into the following steps:
- Planning: Planning includes pinpointing the skills your ideal candidate will possess, developing a job description, and creating guidelines for recruitment
- Attracting talent: Next, talent acquisition teams will look inside their organization and/or externally for candidates who possess the requisite skills and experience for the role leaders are looking to fill
- Selecting: After an application process that typically includes interviews, written tests, and evaluations, hiring managers will choose the candidate who they believe will be the best fit for the role
- Developing: When the selected candidate steps into the role, their skills will be developed according to the job’s responsibilities. Usually, their first step is completing an onboarding process to get familiar with the role and company culture
- Retaining: Talent management doesn’t end once an employee finishes onboarding. Instead, organizations need to make a concerted effort to hold on to top talent by providing growth opportunities as well as rewards and recognition
- Transitioning: The final step occurs when employees are offboarding. HR teams typically conduct exit interviews and make decisions about how to fill the upcoming vacancy
Talent management model
Talent management models can help leaders visualize the key milestones in the employee lifecycle and what they’ll need to prioritize at each stage. Josh Bersin’s model outlines the most crucial steps in this end-to-end talent management process:
Building a Talent Management Strategy
Every element of workforce strategy needs an upgrade for the new world of work and your approach to talent management is no exception. As employee expectations evolve and operating models are recalibrated, there are a few steps you can take to create a superior talent management playbook, including:
Detailed job description
Whether you’re hoping to fill your role internally or externally, you need to go into your candidate search with a clear outline of exactly what skills and capabilities you’re looking for. Job descriptions should articulate the responsibilities your desired candidate will carry out, what competencies they’ll need to possess, and allude to potential opportunities for future growth.
Person-organization fit
It has never been more important for employees to feel connected to their organization’s culture and values. Consequently, HR and Talent teams need to make sure that a candidate’s beliefs align with their employer’s mission.
Reward and recognition
Recognition needs to be part of your talent management strategy, especially as the war for talent intensifies. Gallup found that employees who feel they’re not adequately recognized at work are three times more likely to say they’ll quit in the next year.
Opportunities for continuous improvement
Internal mobility is another non-negotiable when it comes to retaining top talent during the Great Resignation. Our own research reveals that a lack of growth opportunities is the second most common reason that employees cite in their decision to switch jobs. If you want your people to stay with your company, you need to demonstrate that their future with your organization is bright.
How has talent management changed?
Talent management practices were evolving long before COVID-19 and the pandemic has only accelerated these changes. In the past, talent management strategies were primarily prescriptive and administrative. Employees participated in the same set of talent management practices, like annual performance reviews and L&D curriculums, and the overarching focus was on managing performance.
In contrast, today’s approach to talent management is significantly more personalized, purpose-driven, and underpinned by emerging technology. Rather than expecting team members to climb traditional, linear career ladders, companies are recalibrating their approach to empower employees to take charge of their own professional development.
There’s also an increased emphasis on helping employees find and identify opportunities that align with both their personal ambitions and business priorities. As this shift continues, conversations about talent management and performance are transitioning from top-down to increasingly open, and at times, employee-led.
Much of this change is being fueled by the rise in new technologies that enable employees to see the kinds of opportunities that are available within their organization and the skills they’ll need to obtain to step into new roles. Talent marketplaces are a key example of the kind of disruptive technology that is underpinning significant changes to traditional talent management strategies.
Why is talent management important?
Talent management is one of the most important components of any overarching business strategy because, at the end of the day, your people are the heart of your company. Without the right talent, you won’t be able to satisfy customers, continue to innovate in your industry, and meet the benchmarks established by your leadership team. To make matters worse, your corporate culture and overall morale will suffer if you don’t hire the employees you need to support your business’s growth.
The talent landscape has never been more complex, which means leaders need to go the extra mile to ensure their talent management strategies are cutting-edge and employee-centric. The businesses that are committed to managing talent well will gain a significant competitive advantage, as these companies will be able to retain their top employees and ensure that people continue to grow within their organization.
In the past, many companies tried to keep expenses related to employees low in an effort to improve their bottom lines. But in today’s competitive landscape, investing in your people has become increasingly important. Rather than prioritizing perks and benefits in an effort to retain top talent, businesses need to make investments that align with what their employees are really looking for: purposeful work and the opportunity to continue to grow and develop their skill sets.
What is a talent management system?
A talent management system (TMS) is an integrated software solution that covers the full scope of talent management, including recruitment and employee onboarding, performance management, learning and development, compensation management, and succession planning.
While talent management systems are a crucial technology to support HR’s role in optimizing the end-to-end employee life cycle, they’re far from the only platform that you need to have in your HR tech stack. Talent marketplaces have emerged as another essential technology that enables employers to democratize access to opportunity and uncover talent that they may have once overlooked. The two-sided platforms harness the power of AI to match employees to internal opportunities such as projects, gigs, mentorships, and full-time roles that align with their skills, experience, and ambitions.
What are the key benefits of talent management?
A superior talent management strategy is a major competitive advantage that can help you win the new war for talent and ensure you have the skills you need to set up your business for success in the new world of work. 4 of the key benefits of talent management include:
Improve employee engagement and productivity
Identifying and nurturing employees’ skills and development is at the heart of every successful talent management strategy. Rather than allocating the same handful of employees to projects and causing these team members to become burnt out, talent management ensures that people from across the organization have the opportunity to take on projects that align with their goals and business priorities. This approach will likely lead to a significant performance boost, as Gallup noted that utilizing the skills and strengths of employees regularly improves their engagement by six times.
Enable succession planning for critical positions
The right talent management strategy will also make it easier to create a future-proof succession plan that will prepare the next generation of talent for leadership positions down the line. During business expansion or management turnover, succession planning ensures that productivity and employee morale aren’t impacted. Training and upskilling must be core components of succession planning, and a strong talent management strategy will ensure that these growth opportunities are readily available to your next generation of leaders.
Enhance retention
Right now, improving turnover rates and boosting retention are at the top of every leader’s priority list, and with good reason. Over the course of the last year, more than 38 million people voluntarily resigned from their roles. To prevent the turnover tsunami from wreaking havoc in your organization, you need to make sure your talent management strategy is designed to optimize people’s experience throughout every stage of the employee lifecycle. If you prioritize growth opportunities and encourage employees to play an active role in their professional development, you’ll be able to protect your organization from the worst of the resignation spikes that so many businesses are seeing.
Increase agility
Agility is much more than a buzzword; it’s a prerequisite for success in the new world of work. As the pace of change accelerates, every organization is going to need to pivot quickly to respond to situations as they evolve. A core component of agility is the ability to rapidly allocate talent as business priorities shift, and that is only possible with an effective talent management strategy. When you prioritize building future-fit skills, you’ll have the talent and resources needed to respond to change quickly and outpace your competition.
In the new world of work, simply being familiar with the term “talent management” isn’t going to cut it. Instead, HR leaders need an in-depth understanding of the best practices that will optimize every stage of the employee lifecycle and the innovative technology that can be leveraged to take talent management strategies to the next level. If you’re looking to learn more about how you can leverage talent marketplaces to put employees in the driver’s seat of their professional progression, check out our guide, Unlocking career agility: transitioning from ladders to lifelong reinvention.
