Winning the Talent Wars
- A discussion guide
Robert M. Tomasko
Observations
o Shortfalls:
"We bring in highly talented people." (23%)
"We develop people quickly and effectively." (3%)
"We retain almost all our high performers." (10%)
"We remove low performers relatively quickly." (3%)
" We know who our high and low performers are."
(16%)
o Be wary of herd mentality
Homogeneity pays in growth industries.
Differentiation is name of game in mature markets
o Talent comes in many flavors
One company's best and brightest may be another's
ball and chain
o Contrarian view: talent is really abundant,
but in many cases unrecognized
Trick is (to take advantage of tight labor market) to discover
it.
Taking the issue apart
o Demographics: 2000-2010
- 15% fewer Americans in 35-45 age group
- economic growth (3-4%/yr) increases demand by 20-25%
o Demand-driven skill shortages:
- IT professionals
- IT-savvy executives
- globally-experienced managers
- adult supervision
o New mindset about work
- accelerated job mobility
- diminished expectations about long term career in same
company, industry, or function
o Rise of the freelance workforce/free agency
o Increased willingness for highly talented people to opt
out of the
labor market
o Small is beautiful
- talent migration to small and mid-sized companies
o Biggest career risk = not taking a risk
- failure = badge of honor
o "New softness": changing attitudes about work-family
balance
o "New hardness": lure of equity and options/long-term
wealth
accumulation
o Search for control over lives
o Brain drain is effecting grad schools also
- applications down; drop-outs up
o New labor market competition
- competition stronger from outside than inside industry
- dot.com/start-up world
o Industry shift from talent recycler within industry to talent
exporter
o Battlefronts
- entry recruiting
- attracting mid and senior executive
- hanging-on to high potential junior talent
- hanging-on to higher performing senior talent
Industry image
- in media
- among talent gatekeepers (faculty and recruiters)
- among potential new entrants
- among people already on-board
Perceptions
- slow growth means limited career and low wealth-creating
possibilities
- job cuts: will downsizing beget growth or more cuts?
- merger and consolidation
- few products that capture imagination of consumers
Implications
o Don't assume what worked before will be best for the future
o Is the talent mix that brought the industry to where it
is today the
appropriate mix to drive future growth?
o Is this a time to rethink traditional industry organization
and career
paths?
o Is this a time to lose poor performers and mismatches with
limited
potential, and to reduce career-time-to-the-top for high
performers?
o Adversity can breed innovation: being locked-out of old
channels
for talent can force innovation to find new ones
o Is this an opportunity to increase bio-diversity?
- drive renewed growth with hand-picked cultural misfits
- search for new talent able to make the new rules for the
industry, not for people best able to play by the old rules
Five strategies
1. Do what everyone else is doing only better
2. Do with less
3. Do without
4. Do with different
5. Do things differently
1. Do what everyone else is doing only better
o Become a preferred employer
o Become a Fortune 100 Best Places to Work company
o Strengthen workplace social ties
o Better mold jobs to people
o Appoint a retention czar
o Become a better labor market predator
o Bid-up talent costs
2. Do with less
o Lower internal mobility barriers
o Create talent alliances to keep surplus good performers
in the
industry
o Adjust to product line rationalization and consolidation
with
smaller, but better talent base
3. Do without
o Better utilize existing talent
o Cut unnecessary and low priority work
o "We never knew we didn't need them until we didn't
have them"
4. Do with different
o B-list sourcing
o Discover under-tapped labor pools
o Broaden geographic reach
o Uncover hidden jewels already on the payroll
o Employee lending
o Mitigate disruption from unplanned turnover with term limits
5. Do things differently
o Measure and manage intellectual capital/talent base of the
business
o Hold line management responsible for attracting, developing,
utilizing and retaining the business talent base - and regularly
dismissing the least effective people
o Change the organization to attract wanted talent:
Create a free market for growth ideas, capital and talent
Seed organization with internal venture capitalists and start-
up angels
Run business plan competitions
Offer a different risk/reward proposition
Spin-outs/equity carve-outs
o Change the organization to utilize talent available
o Fix, don't fire
o Change assumptions about the career pipeline
- go outside if talent has traditionally been home grown
- do better developing inside talent if senior jobs have
often been filled by outsiders in the past
o Think about jobs as if they were products:
Employees are the consumers of these products
Recruiting sets the stage for product trial
Employee retention is repeat purchase
It's much more expensive to find new customers (employees)
than to keep old ones
Employee turnover is product rejection
Employee satisfaction can be measured along the lines of
customer satisfaction
Customers (employees) are most likely to keep buying a
product (job) if it meets what they perceive as their needs
As the economy matures, customer needs increasingly
fragment - likewise, one size job doesn't fit all anymore
Customizing jobs is a lot like niche marketing
o Embrace a magnetic mission
o Lower walls between company and outside
- think assignments, not jobs
- rent, don't buy
- adapt to free agency
o Don't compete with dot.com's - become one
o Move the company (or part of it)
Examples of leverage points
o Focus on retention before recruiting
o Create intra-industry mobility mechanisms to high
performance/high potential people in the industry
o Cultivate key business school and university gatekeepers
o Change how the industry is perceived
o Articulate a compelling mission
o Uncover and accelerate use of best practices throughout
the
industry
o Start by building a fact base
Use intelligence gathering
to re-examine assumptions and scope-out alternatives
o Do we need to know more about the preferences of those we
would like to hire?
- why don't people find us attractive (from their
perspective, not ours)?
o What kinds of people do we most easily attract?
- are we losing good, great or average people?
- why don't people with promise stay? (from their
perspective, not ours)
o What kinds of people are most likely to stay?
- are we recruiting turnover-prone people?
o What do we need to know about our talent competitors?
- what do their growth trajectories say about their
future talent requirements?
o How can we avoid solving yesterday;s problems?
- how will the industry talent requirements of the next 5
years differ from those of the past 5?
o How are other industries handling this situation?
- our toughest labor market competitors?
- other industries suffering from dot.com competition?
o Do we need to consider changing the industry's organization
model to accommodate the new talent realities (and to drive
growth)? What other models are worth considering?
o Where is the talent issue on the top management radar screen?
o How strong is the industry consensus about the situation
and
actions required?
© Robert M. Tomasko 2002
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