Securing the talent for growth

Many organisations lack adequate leadership pipelines, face widespread skill shortages and are struggling to groom and grow the talent needed to fill leadership positions with people who have the skills needed to turn strategy into action, a new study by Right Management Manpower Group as found.

Its report also notes that it is becoming clear that talent management is no longer the purview of just the human resources (HR) department. “There is growing consensus that having the right talent in place at the right time is the responsibility of everyone in top management,” it states.

The study, detailed in a report entitled Talent Management: Accelerating Business Performance ─ Global Trends, Challenges and Priorities, surveyed 2,221 senior leaders and HR professionals from 13 countries and 24 industries.

It found that the top talent management challenges for organisations are:

  • Shortage of talent at all levels.
  • Less than optimal employee engagement.
  • Too few high-potential leaders in the organisation.
  • Loss of top talent to other organisations.
  • Lagging productivity.

In light of the findings, Rosemarie Dentesano AAICD, regional leader and talent management principal for Right Management, says boards need to stop and consider how important human capital is to them in being able to deliver on shareholder value and execute their business strategy.

“Today, most organisations have invested in finance and technical systems, but they need to pay the same attention to human capital as they pay to other capital assets, such as financial and IT systems.”

The report notes that many organisations reduced investment in employee development as they dealt with fiscal challenges in the aftermath of the global financial crisis.

“It resulted in many organisations stripping layers out of their business and a lot of people wearing two hats,” says Dentesano. “There is a significant gap in many organisations between senior leaders and more junior levels because that mid-level bench strength is not as robust.”

Middle managers, however, are the bridge and communication gatekeepers in an organisation, responsible for connecting the goals and strategies of top level leaders to work practices and everyday tasks of front line staff and transmitting messages up and down the workforce ladder.

Still, one of the survey’s finding was that 78 per cent of Australian organisations did not characterise their mid-level bench strength as robust.

“A layer has been removed and there is an incredible stretch in roles and also, some organisations see an investment in employee development as being a discretionary spend,” says Dentesano.

“Companies understand that competing in the human age – when the ability to thrive is dependent on an organisation’s ability to unleash human potential – requires rethinking approaches to identifying and developing the talent in their organisations,” notes the report. And, many organisations appear poised to respond to challenges.

Around the globe, when asked as part of the survey what new talent management initiatives organisations will undertake in the next year, leadership development was identified as the primary focus of talent management investments with 46 per cent of organisations globally planning to invest. Organisations also plan to develop targeted skills critical to the organisation (39 per cent) and investment in the assessment of skills throughout the organisation (33 per cent).

As a start, Dentesano suggests Australian boards ask the following questions about their organisations’ human capital: 

  • Are our people important in delivering our strategy?
  • Do we have good leadership?
  • Are we investing in ensuring that people understand what their roles as leaders are?
  • Are we giving our people the skills capability to execute their roles?
  • What is the employee experience and level of engagement at our organisation?

On whether the HR director should have a seat at the board, Dentesano says: “That depends on the structure of the board. Your CEO could adequately represent many functions of the business. It’s about the board having the conversation and the HR director needs to be able to inform that strategic conversation.” 

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