Talent Management

Talent Management is managing the ability, competency and power of employees within an organisation.

The concept is not restricted to recruiting the right candidate at the night time but it extends to exploring the hidden
and unusual qualities of your employees and developing and nurturing them to get the desired results.

Talent Management, also known as Human Capital Management is the process of recruiting, managing, assessing,
developing, and maintaining an organisation's most important resource i.e. its people (Bhatla, 2007)

Talent Management is a set of integrated organisational workforce processes designed to attract, develop, motivate
and retain productive, engaged employees.

According to M. Armstrong "Talent Management is the processes of ensuring that talented people are attracted,
retained motivated and developed in line with the needs of the organisation"

According to B. Jamka, Talent management is the "attraction, development, and retention" of the talents I.e. the
most valuable staff members, by creating conditions conducive to their potential development, so that they can be
put to use for the company's operations for as long as possible.

According to J Moczydłowska, “Talent Management is a set of activities taken vis-à-vis personnel with outstanding
talents to ensure their development and increase their operational efficiency, while simultaneously achieving
corporate goals.

Need and scope of Talent Management

In today's competitive and complicated talent situation in the world and global approach management it has huge
potential. Scope of talent management is very wide and far reaching management is a key succession planning tool
that provides an integrated means of ide selecting, developing and retaining top talent within organisations which is
required for I planning. The main area of scope can be the following:

1. Identification of the talent required: It's very important for any organisation to r most talented and skilled
employees available.
2. Right selection of talent or human resource: Right person at the right job is the key to having a successful
and effective organisation.
3. Clear, competent and competitive compensation plan: Every organisation has to aim at paying the right
compensation to the right people. Underpaid employees are generally not effective compared to adequately
paid employees.
4. Training and Development of talented individuals: For an organisation to sustain in today's competitive
market and fast evolving economy companies have to keep their employees trained and have smart
development programs to keep them updated to meet market challenges and requirements.
5. Strong performance assessment system: Efficient and effective employee needs to be assessed properly,
systematically and in a planned manner to be appreciated, therefore organisations needs to have a very
strong performance appraisal system.
6. Retaining the right and synergised talent: Today every organisation is out to head hunt the best talent and
talent management is a perfect tool to retain the talent with the organisation and keep the synergy between
employee and organisation smooth and growing.

Advantages and Disadvantages

Advantages

 Help in ascertaining the night person is deployed in the right position.

 Contributes in retaining their top talent
 Better hiring by hiring assessments
 Helps in understanding employees better and shaping their future
 Promotes effective communication across different disciplines

Disadvantages
  The implementation of talent management program could be expensive in terms of time, resources and
financial costs.
 Lack of support from line managers can impede the level of commitment from employees
 A core drawback of talent management is, it can contribute in raising the conflicts between
 HR and management by not reaching to proper agreement or consensus

Talent Gap- Meaning and strategies to fill gap

The definition of a talent gap, also known as a skills gap, where there are more jobs than qualified people to fill
them.

A talent gap is defined as "a significant gap between an organisation's skill/talent needs and the current capabilities
of its workforce. It's the point at which the organisation can no longer grow or remain competitive because they
don't have the right talent to help drive business results and support the organisation's strategies and goals There
are a number of methods an employer can utilise when overcoming the talent gap

Once current and future potential talent gaps are identified clearly, strategists can begin to develop concrete action
and investment plans. Here are five key action areas to address

1. Build and maintain a structured, searchable skills, and competency database which useful in making
assignments that account for competency, identifying talent gaps and directing future investments in hiring,
training and development
2. Create and align specific career and salary progression tracks, using business and technology strategic
roadmaps as a starting point.
3. Tap into large, but significantly under-utilised talent pools such as ex-defence, retired personnel and
average graduates who can be recruited in certain job profiles which enhances and expedites their work
skills and also benefits the organisation.
4. Fund or deploy ongoing professional development to re-skill existing staff
5. Build and market the organisation as a brand for employer of choice

Sources of Talent Management

 Traditional staffing agencies and suppliers

 Personal networks of managers and executives
 Private talent pools includes alumni, former workers, retirees, and past contingent workers
 Social media and social networks such as LinkedIn
 Online labour market places
 Automated B2B supplier networks
 Human cloud solutions

Human Resource Management and Talent Management

HRM TM
1. Broad Scope 1. Focus on
(entire employees) segmentation (key
group of core
2. Emphasise employees and key
egalitarianism positions)

3. Focus on 2. Focus on
administrative potential
functions
3. Focus on the
4. Transactional attraction,
development and
5. Focus on retention of talent
systems with silo
 approach 4. Focus on
integration of HR
systems

Human Resource Factors contributing to creation and sustenance of organizational excellence

Organizational excellence helps an organization to excel in all its sphere of activities. It makes the organization to
achieve and sustain outstanding levels of performance which meets or exceeds the expectations of all the
stakeholders.

An organization to achieve sustainable organizational excellence needs support of the following key organizational
pillars

Performance oriented culture

Low turnover

High levels of employee satisfaction

Cadre of qualified replacement

Effective investment in employees compensation and development

Use of competencies in employees selection & performance evaluation process.

These pillars provide the foundation for achieving the excellence as well as a common language for the top
management. The key to organizational excellence is combining and managing them together

1. Performance oriented culture: A high-performing company culture is a set of behaviours and norms that
leads an organization to achieve superior results. A company exhibiting such a culture routinely achieves
better financial and non-financial results – such as customer satisfaction, employee retention,
competitiveness, and innovation – than those of its peers over a long period. A performance orientation
culture is characterized by the inculcate a working environment where success is the result of superior ability
and of surpassing one's peers. A culture of high-performance can be an incredibly motivating force and
change the course of an organization. The following five key elements need to be addressed to create a
high-performance company culture:
 Clarify and Communicate Values
 Reinforce Positive Behaviour
 Encourage Open Communication
 Empower Employees
 Collect Feedback

2. Low turnover: Low turnover means a company has a relatively small number of employees leave during a
given period relative to the employees hired or employed at the start of that period. Typically calculated as a
percentage of total employees on an annual basis, company turnover data offers a glimpse at recruiting and
retention success.
The benefits of low turnover are decreased cost. Obviously the indirect costs, which are the replacement
costs for a new employee, or the direct costs that it has to take care of an employee are things that you're
going to reduce by hiring the right people, matching them to their job and expecting from that more
longevity as far as say, performance of the essential functions.
 3. High levels of employee satisfaction: Employee satisfaction is the level of happiness or contentment an
employee feels for his/her job. Employee satisfaction is an essential aspect of any business or organization.
When employees are happy and satisfied with the management and work culture, they put their best effort
to make the company successful. Satisfied employees are the ones who are extremely loyal towards their
organization and stick to it even in the worst scenario.

4. Cadre of qualified replacement: A replacement plan identifies "backups" for positions. Traditionally, it
focuses on top-level positions, but it can be done for any key position in the organization. Having individuals
identified as backups just makes good business sense as it develops a culture of continuous flow of activities
irrespective of untimely leave by employees at different positions.

5. Effective investment in employees’ compensation and development: To attract and retain top talent, an
organisation needs to invest in employee development. Leading organizations invests heavily in employee
training and development because the benefits of training to employers are immense and diverse. Employee
training has recently become a vital business strategy not only to retain employees, but also to create
a skilled workforce for the future.

6. Use of competencies in employees’ selection & performance evaluation process: Competency

management systems allow employers to evaluate employees' performance. Use of these systems allows
managers and supervisors to identify gaps, deploy remedial training, recruit staff and compensate current
employees appropriately. Developing competency-based performance management systems typically
involves creating comprehensive competency models for all jobs and assessing employees against those
models during annual performance reviews.

Role of talent management in building sustainable competitive advantage to an organisation

Organisations work towards the achievement of their mission and strategic objectives. This requires a thorough
understanding of the resources required for achieving the same Resources here imply financial and non financial
both and they are equally important and interdependent

Technically these resources have been divided into two, non-contingent and differentiating capabilities. Whereas
non contingent capabilities are basics that enable an organisation to compete and exist in the marketplace,
differentiating capabilities are those that differentiate an organisation from that of the other and offer competitive
advantage. Effective marketing management, for example can be one of non-contingent capabilities. Similarly many
HR processes aspire to develop non-contingent capabilities but they often fail to align with the strategy and offer
competitive advantage Most of these processes end up developing people in similar areas and similar capacities as
their rival firms but this fails to provide any competitive advantage.

For organisation's to develop competitive advantage through HR processes it is very important to define strategic
differentiating capabilities and then develop a process for identifying and developing the same. This empowers the
HR people to create an impact on the organisational strategy and also provides a link between talent management
and strategy

For HR to prove that talent management can be of strategic importance to organisations, the critical relationship
between the two must be proven Talent management specially needs to be projected as a differentiating strategic
capability that can offer real and substantial competitive advantage

According to research conducted by various bodies it was found out that creation of differentiating strategic
capabilities signifies the relationship between business strategy and human resources Human resources, it was
deduced are the primary sources of strategic advantage.

The research study was primarily based on Resource based view (RBV) of an organisation This view has gained
significant ground among HR practitioners as basis of models for formation and structure of resources
Unlike other non-contingent capabilities that can be developed easily and cannot contribute to a large extent
towards the development of a sustainable competitive advantage, differentiating strategic capability such as
strategic HR through talent management can

However for human resources to qualify as potential sources of competitive advantage, they should fulfil the
following criteria)

1. Strategic Value: The resource has to contribute substantially and add value in his/her area of expertise
2. Rare: Unique in terms of skills, knowledge and abilities in order to qualify as rare
3. Appropriable: The extent to which the resource is owned by the firm.
4. Inimitable: Such that the resource cannot be replaced even after the competitors having spotted the same
5. Cannot be Substituted: This means that the resource cannot be substituted by the rival firms and that there
is no match for the talent.

Talent Management System: A talent management system, or TMS, is an integrated system that supports core
talent management processes, including recruitment, employee on-boarding, performance management, learning
and professional development, compensation management, and succession planning. These processes, and the
technical capabilities that support them, are typically delivered via software modules. So, businesses can start with
what they need and add additional functionality as they grow.

Components of creating a Talent Management system

Talent management is about taking a strategic approach to attracting, retaining, and developing a workforce.
Running a company takes more than hiring people who can perform needed tasks. Companies need to build a
competitive workforce by sourcing in-demand skills, investing in continuous learning and skill development, and
managing and optimizing performance.

The skills that companies need evolve as the company grows. It is believed that applying a skills-based lens to
optimize talent enables workers to meet evolving business demands. The nature of work continues to change, and
along with it, the management of the workforce also needs to change.

High performing organisation consists of 3 iterative components:

 Blueprint
 Set of building blocks
 A system that integrates the Human programs

Blueprint
It is a set of principles that guides the organisation’s strategic & tactical talent management processes. It consists of

 Creed
 Talent management strategy

Creed: A talent management creed is composed of a widely publicised set of core principles, values, and mutual
expectations that guide the behaviour of an institution and its people, collectively. These stated doctrines depict the
type of culture an organisation strives to create to achieve its unique portrait of success.

The principles of the creed are embedded in both its talent management strategy and in its talent management
processes by incorporating its doctrines into selection criteria, competency definitions, performance criteria, and
internal selection, compensation, and development processes.

An excellent example of a creed is the Johnson & Johnson credo. Johnson & Johnson is consistently among the top
groups on Fortune's Most Admired Companies list. Johnson & Johnson states, "Our Credo is more than just a moral
compass. We believe it's a recipe for business success.

Talent Strategy
A talent strategy makes explicit the type of investments an organization makes today in the people whom it believes
will best help it achieve competitive excellence in the future. A talent management strategy views a workforce as a
portfolio of human resource assets that are differentiated based on an assessment of each person's current and
potential contribution to organization success. The types of people who will receive different types of investment are
rooted in the organization's talent creed. The workforce into the following groups:

 Super-keeper: Those employees who greatly exceed expectations now and who are projected to continue to
do so in the future (3 percent).
 Keepers: Those employees who exceed expectations now and who are projected to continue todo so in the
future (20 percent).
 Solid citizen: Those employees who meet expectations (75 percent).
 Misfits: Those employees who are below expectations (2 percent).

Employees are placed in this category when they are either weak performers or lack the competencies for doing
their job.

In this classification system super-keepers and keepers are the primary role models that shape the high-
performance culture. We have found that, regardless of the content of an organization's creed, the talent strategies
of most high-performing organizations contain the following three directives:

 Cultivate the super-keeper.

 Retain key position backups.
 Appropriately allocate training, rewards, education, assignments, and development (TREADs).

Cultivate the Super-keeper- This strategic directive involves the identification, heir loss or absence severely inhibits
organization growth because of their disproportionately powerful impact on current and future organization
performance. Bill Gates once said, "Take our 20 best people away from us and I can tell you that Microsoft would be
an unimportant company."

Retain Key Position Backups- The second directive involves the identification and development of high-quality
replacements for a limited number of positions designated as key to current and future organization success. The
gaps in replacement activity for incumbents in key positions are highly disruptive, costly, and distracting to an
organization. To achieve organizational excellence, key positions should be staffed by employees, and have
replacements who have, historically exceeded organization performance expectations, show a commitment to
develop others, and are role models for the organization's creed. These employees are the superkeepers and
keepers.

Allocate TREADs Appropriately: TREADS refer to investments made by an organization in the form of training,
rewards, education, assignments, and development activities. The return on most of these investments, however,
will not be realized until the future. To properly invest its TREADS, an organization uses the classification of
employees based on his or her actual or potential for adding value to the organization
 Set of building blocks
Once an organization formally commits to building a high-performance workforce, it will need to translate its talent
creed and strategy into assessment tools that classify its people into one of these four categories: Superkeeper,
Keeper, Solid Citizen and Misfit.

Successful organizations use a talent management approach that links the three assessment tools, or building blocks
are

 Competency Assessment
 Performance appraisal
 Measurement Scales for Performance and Potential

A system that integrates the Human programs

Measuring Talent Management

Evaluate the results of talent management systems on a regular basis for

1. Effectiveness
2. Quality
3. Credibility
4. Timeliness
5. Return on Investment

Talent Metrics Measure

Return on Investment
Lower turnover & greater Workforce turnover rate as percentage
retention of skills
Productivity increases
Cost-income ratio as a result of
talent management
Employee retention
Employee Engagement
Internal promotion versus external
Return in Human Capital
Return in investment in talent = (Total benefit of investment in talent * 100) /
Total cost of delivering talent programs or initiatives
Throughput of the unit per capita
Operating cost divided by operating income
Retention metrics
Employees attitude surveys, Employees engagement index
Work force management data
recruitment

Availability of people to manage

strategic projects