Refrences

http://www.hrmagazine.co.uk/hr/features/1073763/talent-driving-globaleconomy-hr-directors-ensure-competitive-advantage-boardroom http://www.managementstudyguide.com/talent-in-global-economy.htm http://bigthink.com/experts-corner/the-new-talent-economy http://articles.economictimes.indiatimes.com/2013-0219/news/37179745_1_talent-management-hul-recruiters http://www.theatlanticcities.com/jobs-and-economy/2012/09/talent-beatstrade-economic-development/3083/

Talentism is the new capitalism: that is the message of a research report by Mercer and the World Economic Forum, unveiled in Davos this year. It concludes that talent is 'the fuel that drives the engine of the global economy'. Talent is an enabler for private companies, governments and academic institutions to close skills gaps and remedy talent shortages, while also moving more to employability and employment. The report continues: "In response to particular labour market failures, talent mobility practices can effectively boost labour supply, stimulate demand, or better equilibrate supply and demand through changes in the cost or quantity of labour - all of which lead to growth." And putting this into the context of HR, other than the loss of the very people that keep them in business, the customers, there is no bigger risk to leaders of global organisations than a shortage of talent. When it comes to business, a knowledge of talent management is of major competitive advantage in the boardroom for any HR director, because, as the research proclaims in bold print, business success fundamentally boils down to talent. "There is self- evidently a link between a country's GDP and the size of its working population," notes Sue Brooks, MD of talent management specialists Ochre House. In this tough environment, businesses have to adapt not only to survive but to bring innovation and creativity to the table - impossible without the right talent. But assigning responsibility for talent management - in that it might not be up to HR directors to devise a talent strategy any longer - poses challenges to businesses, not least because the nature of talent is changing.

Traditionally, responsibility for talent lay with the HR department, as part of its overall people remit. But it is impossible for HR directors to have a detailed working knowledge of every individual in a company numbering hundreds or even thousands of people. "There is a question about what kind of capabilities you will need in the future, and how you will develop them," says Ed Griffin, group HRD at Chime Sports Marketing. "This is particularly pertinent if these capabilities are not necessarily valued right now. For example, a lot of organisations currently have a focus on digital skills, but if you go back five years, digital skills were a luxury, a 'nice to have'. Now they are essential, but you will have to pay a lot more for them than you would if they were already in place." HR then turns to line managers to utilise their in-depth knowledge of the workforce, but as research from Roffey Park, published in HRmagazine in February, revealed, the line resents 'extra duties' being foisted upon it, and can often view talent management as simply one more thing getting in the way of the day job. "We in HR constantly think 'why aren't line managers doing this?'," says Hannah Sandford, head of business psychology at HR consultancy, ETS. "We don't give them enough credit for the fact that it is really difficult, and line managers are not experts in talent management. For the line, it is just an extra thing to do." Andrea Ranyard, L&D director at ITV, says HR must help line managers take ownership of the talent management agenda. "It is essential to involve line managers and they are very much central to the success of our talent strategy at ITV," she says. "Managers are in the best possible position to nurture talent," she says. Niki Rouse, head of people at training venue supplier, etc.venues, an employer of 250 staff in London and Birmingham, agrees. "In some of the more corporate or public sector organisations, HR tends to sit in an office, as opposed to being on the floor operationally and understanding what is happening in the business and seeing staff," she explains. "Then you will rely on data that's coming out of performance management or talent systems. "You are always going to need line managers' input, as they work with people in the day-to-day business." But Matthew Mellor, MD of search consultancy Armstrong Craven, has reservations that involving line managers in planning a talent pipeline might lack a strategic imperative. He fears using the line for talent management can be more of a cost-cutting exercise than a decision prompted by the needs of the business. "In this climate, we have seen a lot of businesses cut costs, and where departments - including HR - have been rationalised and resized, talent management has been put to the line," he explains. But he adds: "Where businesses do this well, it is an opportunity to improve talent management." According to Chris Phillips, VP for EMEA marketing at talent management consultancy Taleo, the ratio of line managers to employees is likely to be 1:5 or 1:10, whereas for HR staff it is more likely to be 1:100. So a realistic and effective talent-management solution incorporates both HR and the line. "HR's role is to support and facilitate the process," says ITV's Ranyard.

But HR also needs to have accountability for talent management, and make sure it is being performed effectively. Without support from HR, there is a threat managers could home in on individuals who remind them of themselves in some way - the 'like me' approach. "This can be challenging," says Sandford at ETS. "You end up with people being evaluated and identified as talent on the basis of their personality, not what they deliver." Jason Miller, founding partner at business coaching consultancy Tinder Box, agrees line managers are prone to subjectivity and cites his own experience as an example. "Working on the operational side at BP, I had a team of 250 people and had complete autonomy. But I don't know if my view of talent was the right one in terms of what was right for the business. I could take a much more parochial view and only take an interest in people who were like me, rather than thinking about the company as a whole." He adds: "The reality is, there's probably a lot of that going on." Managing talent within the organisation doesn't stop at identifying the future stars of the business. They also need to be persuaded to stay. Miller advises 're-recruiting' talent each year, sitting them down and explaining that they have been earmarked as future leaders within the organisation and asking what it will take to make them stay. "We often assume people are going to stick around, but has anybody actually asked them?" he muses. The HR role also encompasses developing what Griffin calls "talent pools outside the organisation". This involves identifying individuals that the organisation will need to recruit in the future, and finding ways to get to know them and connect with them to make the process of recruitment easier - and cheaper. Sinad Hasson, MD of market research recruiters Hasson Associates, says: "On a day-to-day basis, attracting talent should be the responsibility of hiring teams and HR. HR should identify the correct channels - recruiters, job boards and events, for example - and line managers can then work to help direct HR and support their recruitment goals." But Phillips warns the tools and processes put in place around talent management should be tailored to the needs of the line manager - not to the convenience of HR. "In the past, this hasn't been done very well," he observes. "HR has either put in processes and systems that are there to suit its own needs, rather than those of the line manager. Or, it has introduced self-service tools that push a lot of work into the line manager role. Neither solution is effective." HR needs to think carefully about how much time it is spending on processes, and how much time it is spending connecting with the business leadership. Says Miller: "It is all about execution. I would rather have a mediocre tool with outstanding execution, than the other way round."

The risk for HR is that incorporating the line into talent management risks the much-prized seat at the board table. Nick Holley, director of the Centre of Excellence at Henley Business School, says ultimately HR should not be put off by this. "What really matters is, are you influential?" Holley says. "Are you building the capability of your organisation? Sometimes that can be done more effectively behind the scenes, rather than at the boardroom table." A survey of global business leaders carried out by the Economist Intelligence Unit for Lloyds last year found talent management had shot up from the 22nd priority in 2009 to the number two priority in 2011. In some industries, this is caused by a hangover from the dotcom bubble, when previously fast-growing companies battened down the hatches and stopped hiring at graduate level. More than 10 years later, the impact is being felt at the very senior level those would-be graduate trainees should now have reached. So while the importance of talent for business has reached the top table suddenly, nor is it a fly-by-night buzzword. Talent strategy, like people strategy, needs to evolve - but Valerie Scoular, group HR director of Aegis Media, explains this doesn't mean that HR directors need to be left out in the cold. "In a world where talent is mission-critical for business success, line managers need to lead the charge on attracting and retaining top talent. Talented people want to work for inspirational leaders," she says. "HR's role is to provide thought leadership and exciting talent opportunities to support managers in getting the best out of their people," Scoular added. "The best talent work happens when the individual, the manager and HR all work in partnership." Talent Pools "There are a couple of schools of thought on the talent pool system," says Hannah Stratford, head of business psychology at HR consultancy, ETS. "Some organisations would say everybody is talent and just focusing on specific people doesn't work. "Other organisations have a clear idea of who their talent is and promote and invest in them more than other employees." Talent pools continue to divide opinion. While they can make sense on a business level, allowing HR directors and CEOs to focus resources upon those who display the most potential, having a select group of individuals labelled as 'talent' can have a polarising effect upon the rest of the workforce. Those not identified could struggle with morale and professional confidence. "We believe that everybody has potential and therefore everybody should be in your pool," says Jane Sunley, CEO of Learnpurple. "Not everybody aspires to lead, but everybody wants to learn and develop. Organisations should value each person on their individual skills and attributes and develop them according to their goals and ambitions, in conjunction with organisational needs." Traditionally those with 'star potential' are put into the talent pool. But the process of deciding who should be labelled 'talent' is in itself fraught. Difficulties occur when decisions are made subjectively. Managers may favour those who remind them of themselves in some way - the 'like me' factor.

"A much fairer assessment is where performance is measured consistently and fairly," says Sunley. "It is better if the employee and his or her manager decide on potential future paths together in an honest and frank discussion. Taking this approach stops people 'playing God'." Stratford says it is helpful to identify talent, but warns against putting all budget and spend into developing only a select few. These high-performing individuals are in high demand and could be poached by a rival, leading to a wasted spend. Cast study: Alcatel Lucent Global telecoms giant Alcatel-Lucent found its line managers wanted HR to help give them the ability to find talent across the organisation. Talent management is a big focus for the company, as its growth comes from innovation and creativity. The company needed to be able to stimulate and drive the management of talent across the company through the line, looking at hiring policies and where to place talent within the organisation. "The company wanted a focus on how to understand the skills and capabilities it had across the group and how best to deploy it," says Chris Phillips, VP for EMEA marketing at talent management consultancy Taleo. "It wanted to be able to develop and progress key skills to become more innovative overall." Using tools and processes that would help line managers identify talent, the company was able to become more creative and increase the pace of innovation. The strategy connected a business goal with talent - galvanising the whole organisation to hire the right people with the right skills, and move them around to the right places. By directly linking talent to business success, the value of talent management was demonstrated to the whole organisation. Laurent Geoffroy, VP human resources at Alcatel-Lucent, says: "Our solution proved to be very effective. Using talent intelligence gives us a powerful strategic platform for the management of talent." Talent - the stats 13.5% of European business leaders say talent is a 'very high' priority for their business 11.6% of European business leaders say they are 'very well prepared' for a talent shortage 70% of office-based workers are actively or passively looking for a new job - now 22%

of office-based workers believe their line manager understands their professional capacity the best; just 1% say HR software understands their capabilities the best 86% of businesses globally have processes in place to capture talent analytics data - but less than 50% use it to make informed business decisions 39% of companies don't have formal processes in place to engage and keep staff within the company Sources: Lloyds Risk Index 2011; SHL Global Assessment Trends Report 2012; Taleo UK Social Talent Management Report

A perspective from an ex-CEO changed the way Sonali Roychowdhury, head, HR - India, Procter & Gamble, looked at recruiting. "He said, 'Every day you hire someone, it could just be our next CEO'," says Roychowdhury, who believes that acquiring great talent is the only way her company can stay ahead of competition. This is what drives the war for talent, played out in the country's B-school, engineering college and graduate school campuses year after year. Talent acquisition heads at top recruiters - who hire on average a 100 people across campuses - are the force commanders in this war.

Trade and talent are two key factors in the economic growth and development of cities and metro regions. Harvard University's Michael Porter has distinguished "traded industries" (goods and services that can be traded outside the region where they are produced) from "local industries" (mainly for local consumption and use). Local industries generate lots of employment, but traded industries are the ones that generate real economic dynamism and growth, as The Atlantic's Derek Thompson has noted. Economists have long identified talent, or what they refer to as human capital, as a central factor in economic growth. The accumulation of skills and their clustering in cities leads to higher rates of innovation, entrepreneurship, productivity, and ultimately growth. But how do the two work together to shape regional growth? Which of them is more important? In a Martin Prosperity Institute working paper titled, "Talent versus Trade in Regional Economic Development" [PDF], my colleagues Charlotta Mellander, Ying Sun, and I took a close look. We undertook a detailed statistical analysis to examine the relative roles of these two factors in regional economic growth, the extent to which they work together or separately, and ultimately which of them is more important.

Our research probed the effects of talent and trade on three measures of regional economic development productivity or economic output per person, wages, and innovation measured as patents per 10,000 people. We looked at talent through the lens of education and work, both in terms of educational attainment (the share of adults that are college grads) and as the share of knowledge, professional, and creative workers. For trade, we employed Porter's distinction of traded vs. local industries. We developed a series of multivariate regression models to isolate the effects of these factors on regional economic development while controlling for other factors like population, density, and high-tech industry, that are likely to come into play. The basic finding is that talent plays a substantially larger role than trade in regional economic growth. Talent trumps trade by a large margin when it comes to regional economic development. The talent variables which we measure both as educational human capital (college grads) and knowledge workers explain more of the variation in regional economic performance across all three of our measures. In most cases, the trade variable is not significant, when talent is controlled for. A second key finding concerns the interaction of talent and trade. ... When it comes to economic productivity and wages, talent has an approximately equal effect through traded and local industries, and in some cases, even a stronger effect when employed in local industries. The results for innovation are slightly different. Here, talent appears to work primarily through traded industries; this is the case for both the human capital and knowledge workers. Still, in each and every case, the combined variables with talent (measured as education or knowledge-based occupational structures) have a bigger effect on regional economic performance than the trade variable alone. This suggests that talent plays a vital role through its contributions through both industry structures, as well as on its own as a condition for regional economic performance. When all is said and done the study concludes that: "talent, or what economists refer to as human capital, is the key driver of economic development, having a far greater effect than traded industries."

Talent Economy enables organisations promoting economic, business and social action to innovate faster and make a bigger impact. It does this by helping you to create strategic solutions, produce real world policies and extend your reach.

With a focus on education and skills, entrepreneurship, innovation and economic development our approach is all about facilitating change and securing the best use of resources in a difficult investment and public spending environment.

WAYS TO DO ATTEND TALENT ECONOMY

BUILD A TALENT ECONOMY

Best State to Raise a Child Education Week America must resolve to again be the most talented nation on earth. After the GI Bill greatly expanded higher education access in the aftermath of World War II, our nation became the best-educated nation as measured by the percentage of adults who earn some post-high school diploma or credential. But today weve slipped to 16th in the world in the percentage of 25-34 year olds achieving post-high school degrees.18 If we fix everything else, but do not return America to its status as the best-educated nation, we will cede our role as the most dynamic economy on earth. Virginia has shown that you can transform an economy by winning the race for talent. In the 1950s, Virginia was a low income/low education state. To move forward, we made the decision to embrace talent, end school segregation, allow women full higher-educational opportunities, expand and improve our network of universities, build an infrastructure of community colleges around the state, and reform the curriculum in our schools. The result was an economic boom that moved Virginia to the top tier among states in income and education levels. We achieved this success because we grew our own talent, attracted talent from around the country and around the world, and then became a go-to location for the businesses and institutions that wanted to locate near talented and productive people. In one of my first speeches as Governor, I said, when we lead the way in education, we have better tools to keep our economy strong, and that guided me throughout my term. We expanded the number of children in pre-K by nearly 40 percent,19 instituted teacher evaluations to promote excellence in our schools, reduced the achievement gap for Latino students,20 and passed the largest higher education bond package in Virginia history to modernize facilitiesat colleges and universities across Virginia. No wonder Education Week declared in 2007 that Virginia was the state where a child born is significantly more likely to experience success throughout life than the average child born in the United States.21 We need to pursue the same strategies at the national level, not to supplant the role of state and local governments, but to make sure we have a national talent strategy that matches and exceeds our global competitors. Excel in Early Childhood Education

The research clearly demonstrates high-quality early childhood opportunities help children succeed. Thats why we expanded participation in Virginia in early childhood programs by nearly 40 percent22 even as we were making over $5 billion in budget cuts. As Senator, I will support putting all early childhood funds under coordinated management so we can make sure we truly invest in high-quality opportunities for the greatest number of children. We should take the different federal funding streams and make sure all monieswhether pre-kindergarten, Welfare-to-Work or Head Startare directed in ways so that the educational quality is the top criterion. Revise No Child Left Behind NCLB was a step forward because it made us dig beneath state and local educational averages to confront regional and demographic disparities in educational performance. Increases in national graduation rates are one indication of the success of NCLB. But, NCLB needs significant changes if we are to have world-class educational achievement. The law is too focused on minimum competence tests. As Senator, I would push for revisions that focusmore on finding and enhancing each childs excellence, with more individual attention than a traditional one-size-fits-all approach. The federal government should support these curricular innovations financially rather than make them top-down, unfunded federal mandates. And, we should create a vigorous culture of local experimentation. NCLB has been applied in a rigid way that is more focused on process than results and outcomes. States and localities that demonstrate strong outcomes should be allowed maximum flexibility in meeting curricular benchmarks. Promote State Competition State policymakers watch competitive rankings of business climate, management performance, test scores, and other outcomes. When a state doesnt stack up well compared to other states, there is a strong incentive for improvement. As Senator, I will lead the creation of an independent commission of stakeholders, including teachers, to create a report card of all state school systems every three years on a variety of outcomes adoption of college- and career-ready curriculum standards, assessment practices, teacher qualifications, and student performance. This kind of evaluation would ultimately reflect how seriously policymakers are taking the mission of providing top quality education for their citizens and inspire stronger local and state efforts. Support Our Nations Teachers Teachers have one of the most important jobs in our nation educating tomorrows workforce. We must encourage teachers ongoing education to ensure our children receive the best education possible. As Senator, I will ensure teachers have access to the professional development and certification programs that will provide them with the tools and support to meet daily challenges. I will support

programs such as the National Board for Professional Teaching Standards that allow teachers to continually improve their skills. Elevate the Importance of Career and Technical Education (CTE) The nation has undervalued the importance of career and technical programs. I served as principal of a technical school in Honduras in the 1980s, and I helped develop nine Governors Career and Technical Academies in Virginia during my term.23 We need to educate more students about the broad variety of career options and make available the right kinds of training opportunities at an early age. In my travels around the state, I still find companies with advanced manufacturing jobs that go unfilled because of the lack of workers whove been trained in the right disciplines. Just as the nation celebrates high-achieving, college-bound high school students each year with the Presidential Scholars program, as Senator I would support efforts to also celebrate achievement by high school students in technical and career programs with a Congressional Technical Excellence recognition. I will support full funding of the Carl D. Perkins Career and Technical Education Act, which will make sure students have the chance to attend high-quality CTE programs and are prepared for successful careers. Expand College Access Virginias higher education system has been the key contributor to our efforts to build a Talent Economy. I was proud to serve as the Co-Chair of the 2002 Higher Education Bond Campaign that put $900 million into expanding the states higher education system. As Governor, I led passage of an additional $1.4 billion bond package in 2008 to expand classrooms and labs the largest investment of its kind in Virginias history. We must have an equally robust effort to expand college access and degree attainment across the nation. The significant expansion of the Pell Grant program is one of the best achievements of the last decade. Weneed to make sure that more students can afford college. As Senator, I will work to increase access to higher education and preserve programs that increase the affordability of higher education, like the Pell Grant program. I will also recommend that the Department of Education work with college presidents to publish best practices of the universities and community colleges that excel at delivering high-quality education at a reasonable price. Empower Those with Disabilities Sometimes policy gets in the way of folks with disabilities fully offering their talents. I served as Chair of the Virginia Disability Commission, and worked with state officials to incentivize construction of accessible housing and allow buy-in to Medicaid if salaries exceeded federal limits. In other instances, disability policy offers important lessons for broader reforms. Every child deserves specialized instruction and support to meet their unique needs.

 As Senator, I will always look at federal policies to make sure they are fully inclusive of the talents of all citizens. Streamline Federal Workforce Development Programs A recent study by McKinsey Global Institute surveyed 2,000 firms nationally and found that 40 percent had positions open for at least six months because they could not find qualified workers.24 International Monetary Fund economist Prakash Loungani estimates that 25 percent of unemployment is structural, i.e. caused by a mismatch between employer needs and the skills of available workers. In other words, over 3 million more people would be employed if we fix this problem.25 We have to do a better job of leveraging the sizable federal workforce development investment into a streamlined system that is simpler for workers and companies. At the state level, I confronted and simplified a system that provided workforce training opportunities in a dozen agencies spread among four cabinet secretaries. The organizational model is even more complex at the federal level. This not only leads to confusion, but the absence of a single, accountable public official charged with workforce programs makes it difficult to achieve the best outcomes. As Senator, I will work to restructure the federal effort to promote simplicity, transparency and clear accountability. There is a disconnect between the skills taught and the needs of employers. We need reforms to better align planning and spending with the needs of tomorrows workforce. I will also work to foster skills partnerships between community colleges, school systems, career and technical programs, workforce boards, and employers to create programs that meet the needs of local areas. Leverage Veteran Talent Americas military veterans have remarkable skills. When they finish active duty, they take technical proficiency and leadership experiences into every community in the nation. But too often they confront a civilian economy that doesnt understand their unique talents. This becomes more acute as a smaller and smaller percentage of the population has served in the military. Unacceptable unemployment rates for veterans demonstrate the need for better understanding the unique talents that veterans offer. As Senator, I will work with the Department of Defense to establish a basic protocol so that active duty military members receive meaningful and transferable civilian credentials and certifications for skills that they obtain during service. I will also work to educate civilian employers about the skills that veterans bring into the workplace and model the right behavior by hiring veterans in my own office. Attract & Retain Global Talent For far too long, the important issue of comprehensive immigration reform has been used as a political football. Our nation needs a strategy that promotes border security while remaining focused on our goal

of being the most talented nation on earth. The attacks of September 11, 2001 revealed serious flaws in our immigration system. But, in response, we unintentionally made it harder for the best minds in the world to come to this country to study. We have also made it more difficult for successful students to remain in this country after school and create businesses and jobs. As Senator, I will support immigration reform that encourages individuals of talent and persistence to grow opportunities here rather than take their skills and leave the country. Individuals who broke the law by entering this country illegally should face consequences, including a financial penalty that can be applied to increasing our border security, but we must also ensure that our reforms serve the goal of making America a magnet for global talent and the jobs that come with it. Click here to go back to: A Vision for Our Economic Future