SlideShare ist ein Scribd-Unternehmen logo
1 von 39
Downloaden Sie, um offline zu lesen
A Comprehensive Review of Talent Management           Best Practices




  TALENT MANAGEMENT BEST
         PRACTICES
                   A COMPREHENSIVE REVIEW




                                     OMNI LEADERSHIP
               620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427
                              952.426.6100 www.omnilx.com




                                                                                1
                                       OOMNI LMNI
A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT
                             BEST PRACTICES

                                                  TABLE OF CONTENTS
What is Talent Management? ........................................................................................ 3-7
   Historical Roots ................................................................................................................. 3
   The Impact of Technology ................................................................................................ 4
   Moving Toward Effective Talent Management ........................................................... .5-7
Performance Management–Cornerstone of Talent Management…. ....................... 8-11
   Overview ........................................................................................................................... 8
   Best Practices – The Keys to Delivering Value .......................................................... 9-10
   Summary Conclusions.................................................................................................... .11
Identifying High Potentials – Preparing for the Future .......................................... 12-17
   Overview ......................................................................................................................... 12
   The Mystery of Potential – Common Approaches & Problems in
   Measuring Potential .................................................................................................. 12-14
   A Conceptual Model of Potential and Best Practice for
             Measurement ................................................................................................. .15-17
Individual and Group Development.......................................................................... 18-21
   Overview of 360 Surveys for Developmental Planning.................................................. 18
   An Alternative Approach .......................................................................................... 19-20
   Best Practices for Development Talent .................................................................... .20-21
Succession Planning – Developing Bench Strength ................................................. 22-25
   Overview ................................................................................................................... 22-23
   The Core of Succession Planning – A Best Practice
            Talent Review Process .................................................................................... 23-25
Deploying Talent – Putting the Right Person in the Right Job
  Job at the Right Time .............................................................................................. 26-33
   Overview ......................................................................................................................... 26
   A Review of Selection Tools and Best Practices ...................................................... 26-33
Managing Retention and Turnover........................................................................... 33-38
   The Difference Between Wanted vs. Unwanted Turnover ............................................. 33
   A Model of Turnover ................................................................................................ 34-36
   Best Practices for Managing Turnover ...................................................................... 37-38
References .......................................................................................................................... 39




                                                OMNI LEADERSHIP
                          620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427
                                         952.426.6100 www.omnilx.com                                                                        Page 2
A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT
                        BEST PRACTICES

WHAT IS TALENT MANAGEMENT?
Historical Roots

The term Talent Management was first coined in an often cited 1997 article by McKinsey, which
focused on the emerging “war for talent”. Popularized in the 2000’s, various pundits have
offered a definition. Dr. John Sullivan, a popular expert on the subject, suggested in a 2004
Electronic Recruiter Exchange article that four key factors distinguish Talent Management from
traditional HR approaches:

   1.   An integrated approach within HR
   2.   Integrating people processesinto standard business processes
   3.   Shifting responsibility to managers
   4.   Measuring Success with productivity

This definition has changed very little in the past decade, as evidenced by the various references
cited over the course of the second half of the decade:

        Trends in Human Capital Management: The Emerging Talent Management
        Imperative…Knowledge Infusion White Paper, July, 2006

               “The process of managing the supply and capabilities of the workforce to meet
               the demand for talent throughout the organization to achieve optimal business
               performance and in direct alignment with organizational goals.”

        The Official ASTD Blog May 8, 2009

               “A holistic approach to optimizing human capital, which enables an organization
               to drive short and long term results by building culture, engagement, capability,
               and capacity through integrated talent acquisition, development, and deployment
               processes that are aligned to business goals.”

It became clear that a central theme of talent management definitions was a focus on integrated
core processes. Talent management was being seen as synonymous with integrating core HR
talent processes.

        New Talent Management Networks (NTMN) annual talent management report cited in
        HBR Answer Exchange 5/24/2010

               “…companies define talent management largely as consisting of succession
               planning, high potential identification and development, assessment and feedback,
               and career planning/development.”




                                         OMNI LEADERSHIP
                   620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427
                                  952.426.6100 www.omnilx.com                               Page 3
A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT
                          BEST PRACTICES

  WHAT IS TALENT MANAGEMENT?
  The Impact of Technology

  The advent of Software as a Service (SaaS) drove an inflection point in the growth of the Talent
  Management technology market. The market wanted easy and fast access to technology that
  would help them move toward this exciting concept of integrated Talent Management. Guided
  by the accepted definition, with its central focus on talent processes, technology vendors
  developed integrated, automated processes focused on talent acquisition, performance
  management, development, and succession. The technology vendors focused on automating the
  core talent management processes that were seen as being at the core of Talent Management.
  The market philosophy of the technology vendors is illustrated in the graphic below:




                                       CORE TALENT
                                        PROCESSES:

                                   *Performance Mgmt.
BUSINESS STRATEGY                                                          BUSINESS RESULTS
                                   *Hi Po Identification
                                   *Development
                                   *Succession
                                   *Talent Acquisition




  This model positions automated process at the center of Talent Management sandwiched
  between bookends of business strategy and business results. The basic message is to align your
  core talent processes to the talent needs of your business strategy in, order to drive business
  results.

  While these solution platforms have contributed substantial efficiency gains through process
  automation, there is reason to question whether they have also made contributions to increasing
  talent management effectiveness.




                                          OMNI LEADERSHIP
                    620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427
                                   952.426.6100 www.omnilx.com                              Page 4
A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT
                        BEST PRACTICES

WHAT IS TALENT MANAGEMENT?
Moving Toward Effective Talent Management

Three additional components need to be added to the historical model to move the model closer
to one guiding effective talent management:

   1. Talent Measurements – The basics of a Talent System of Record

       You cannot manage what you cannot measure. In order to improve Talent Management
       effectiveness, you need to establish a system of record for talent assets that include
       proven and reliable talent measurements related to successful performance. Sadly, the
       concentration on process automation has neglected generating the talent measurements
       needed for effective talent decision-making.

       The data deficiencies of talent management solutions have been noted by industry
       analysts:

              “The big problem with HCM (Human Capital Management) applications is the
              data. Companies do not have the content or data to understand who their best
              people are and why” (ThinkEquity 2008 Industry Report).

       The graphic below suggests the types of talent measurements that are needed to establish
       a talent system of record that supports effective Talent Management. In order to generate
       this record, a broad range of fully integrated assessment and evaluation tools are needed
       in the Talent Management solution.




                                       OMNI LEADERSHIP
                 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427
                                952.426.6100 www.omnilx.com                               Page 5
A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT
                       BEST PRACTICES

WHAT IS TALENT MANAGEMENT?
Moving Toward Effective Talent Management

   2. Analytics – Decision Support Reporting for Managers

      Once a talent system of record has been generated, it is critical to leverage those
      measurements through thoughtfully designed analytics that drive and inform the talent
      decisions made by managers. Effective Talent Management requires going beyond
      automated processes to presenting line managers with reliable information in a format
      that supports evidence based decision-making. On demand reporting should help
      managers answer the four basic talent decisions that need to be made for any pivotal
      talent pool:
              Who are my top performers both in terms of results achieved and how those
              results were achieved
              Where do I focus individual and group development efforts to maximize ROI
              Which of my top performers also possess high advancement potential and where
              should I focus career development efforts
              Which of the high performing high potentials are ready now for a higher level of
              responsibility

      Analytics are used to manipulate and leverage the core measurements needed to answer
      these questions.

   3. Going Beyond Competencies - Competency models are an important component of an
      integrated talent management solution. They provide a common language used across
      core talent processes and describe the behaviors associated for success for any given
      position in the organization. An effective talent management solution should be able to
      support and drive custom competency models as well as offer rich native competency
      content for all levels of positions within an organization. An effective competency model
      would have the following key content components:

              Competency Label
              Definition
              Key Behaviors
              Performance Standards
              Interview Questions
              Development Guides

      While competencies are an important component of an integrated talent management
      strategy, success profiles for positions need to be more comprehensive than just
      competencies. A common language is also needed for defining experience requirements,
      key traits, motivations, and technical/functional requirements. A common language
      allows companies to create position profiles which can then be scientifically compared to
      the talent system of record to quantify the degree of match between a given individual
      and a specific position.

                                      OMNI LEADERSHIP
                620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427
                               952.426.6100 www.omnilx.com                               Page 6
A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT
                        BEST PRACTICES

WHAT IS TALENT MANAGEMENT?
Talent Management Redefined

John Sullivan’s original suggested key factors for characterizing and defining talent management
were accurate but deficient to fully differentiate strategic talent management from traditional HR
practices. We have suggested three areas that should be integrated into the original list. We
suggest that Talent Management should be redefined in the following manner:

   1. An integrated approach within HR based on a common language for defining and
      profiling success (e.g., competencies, experiences, behavioral predispositions, work
      preferences, etc.)
   2. Integrating people processesinto standard business processes
   3. Establishing a talent system of record containing key talent measurements
   4. Shifting responsibility to managers and equipping them with comprehensive decision
      support reporting capabilities to make key talent decisions
   5. Measuring Success with productivity

These modifications incorporate the three key additions of talent measurements, reporting
analytics and rich underlying content needed to complete the components of effective Talent
Management.




                                       OMNI LEADERSHIP
                 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427
                                952.426.6100 www.omnilx.com                                Page 7
A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT
                        BEST PRACTICES

PERFORMANCE MANAGEMENT – THE CORNERSTONE OF TALENT MANAGEMENT
Overview

Performance management is often portrayed as the most strategic of core talent management
processes. It has captured the attention of C level leaders with the following value promises:
       Focus all employees on priorities and maximize individual productivity
       Provide a foundation and process for improving the overall capabilities of organizational
       talent
       Align individual efforts with the business unit and organizational goals to maximize
       efficiency and effectiveness of organizational execution
       Align rewards and recognition with performance outcomes to ensure retention of key
       performers

However, the question needs to be asked, “How well has performance management delivered on
these promises?” Survey data have not been encouraging. Consider the following findings:

       Performance management is an inconsistently implemented process – A recent study by
       Mercer found that just one third of survey respondents said they had had a formal
       performance appraisal in the last year.
       Performance management has had little impact on performance improvement – The same
       study by Mercer also found that nearly half of those that had received a formal
       performance appraisal indicated that it did not help them identify actions they could take
       to improve.
       There is little alignment with organizational goals – A recent Performance Management
       Practices Survey Report published by Development Dimensions International found that
       “Aligning performance management to support organizational goals and to integrate with
       other systems proved to be the least common quality of performance management
       systems”.
       Aligning pay with performance has been only marginallysuccessful – A recent survey of
       American Compensation Association members found that the majority of members felt
       that merit pay plans tying pay to performance were only marginally successful.

Does Performance Management Deliver Value in Best of Class Organizations?If the value
realized from performance management has been modest for most organizations, one might
wonder if there is greater value for best of class organizations. These data are much more
encouraging:

       Organizations exercising world-class enterprise performance management, including
       widespread dispersal of the tools, enjoy 2.4 times the three-year equity market returns of
       typical companies in their industry (BusinessWeek Research Services 2008)
       Organizations in which employees are measurement-managed were identified as being in
       the top one-third of their industry. Performance measurement was the single most
       important measurement area that separates successful firms from less successful firms
       (Towers Perrin 2002)


                                       OMNI LEADERSHIP
                 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427
                                952.426.6100 www.omnilx.com                                Page 8
A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT
                        BEST PRACTICES

PERFORMANCE MANAGEMENT – THE CORNERSTONE OF TALENT MANAGEMENT
Best Practices - The Keys to Delivering Value

If performance management delivers value in best of class organizations, what are they doing
differently than most organizations? Various authors and research studies have attempted to
identify what are the key drivers in delivering real value from performance management
processes. A summary of key findings are offered below:

       Avoid making it too complicated – Many organizations make the mistake of creating too
       many goals and gathering too many metrics in their performance management process.
       The result is tremendous time investment and employee confusion. BusinessWeek
       Research Services (2008) found that “Determining the appropriate number of goals and
       types of metrics was considered the number one performance management success
       factor.”
       Provide a supportive culture – Performance management has to be supported by senior
       executives. They need to foster a supportive culture in order to realize real value. The
       same study from BusinessWeek Research Services (2008) found that “The biggest
       obstacles to widespread execution of performance management are “lack of
       accountability” and “a culture that does not support measurement.”
       Make it widespread and consistent – Performance management needs to be an enterprise
       wide practice in order to realize full value. This was a finding supported by
       BusinessWeek Research Services (2008). This study indicated that, “The biggest return
       comes from extending performance management to front line workers”. Typically,
       technology is needed to provide widespread access and use. However, remember rule #1
       to keep it simple. Lots of bells and whistles not only results in difficult and costly
       implementations, the added complexity also results in line managers and front line
       workers rejecting the technology.
       Don’t forget foundation skills – Performance management in more than standardizes
       processes and measurements. Real value is dependent on the interactions between
       employees and managers. In an international cross study of performance management
       practices published in SASCOM magazine (4th qtr. 2006), the authors concluded
       “Overall the research shows that successful performance management efforts combine
       the measurement process with appropriate infrastructure, skills, and culture.” Managers
       need to have basic skills to manage performance effectively. These skills include:
           o Setting Performance Goals
           o Monitoring Performance
           o Providing Performance Feedback
           o Conducting Performance Reviews
           o Conducting a Developmental Planning Meeting




                                       OMNI LEADERSHIP
                 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427
                                952.426.6100 www.omnilx.com                              Page 9
A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT
                        BEST PRACTICES

PERFORMANCE MANAGEMENT – THE CORNERSTONE OF TALENT MANAGEMENT
Best Practices - The Keys to Delivering Value (cont.)

        Align individual performance goals with organizational goals – Linking the goals of an
        individual with the broader goals of a business unit or an organization is called cascading.
        In order to optimize strategic value, performance management processes should help
        ensure that the efforts of all employees are in alignment with the goals of the
        organization. Aligning performance management to support organizational goals and to
        integrate with other systems proved to be the most critical differentiator in system
        effectiveness (DDI - Performance Management Practices Survey Report).
        Focus on both the “what’s” and the “how’s” of performance – Job performance is not
        one-dimensional. Focusing only on what was accomplished ignores the importance of
        how the results were achieved. Adding goals for competencies that are needed to support
        results in the plan ensures both aspects of performance are considered. Performance
        against competency goals can be reliably tracked using multi-rater or 360 data. These
        data along with appropriate development content and support processes also help drive
        individual development planning. In spite of the value received from including
        competencies, the DDI Performance Management Practices Survey Report found only
        38% of organizations followed this practice.
        Make it a process not an event – In most organizations, the Performance Review is
        typically treated as a single event, looking backwards rather than forward. Making it an
        ongoing process requires anticipating problems and focusing on the present or future.
        This means that managers need to have frequent ongoing discussions throughout the year
        planning and communicating with employees to improve current and future performance.
        Focus on development and improvement, keep pay discussions separate - Rensis Likert
        offered this critique of the performance review discussion in the July 1959 issue of the
        Harvard Business Review, “The aim of reviewing the subordinate's performance is to
        increase his effectiveness, not to punish him. But apart from those few employees who
        receive the highest possible ratings, performance review interviews, as a rule, are
        seriously deflating to the employee's sense of worth ... not only is the conventional
        performance review failing to make a positive contribution, but in many executives'
        opinions it can do irreparable harm.” Samuel Culbert, a professor of management at
        UCLA and Lawrence Rout, a senior editor at the Wall Street Journal concur in their
        book, "Get Rid of the Performance Review!," These authors contend that the typical
        performance review discussion derails due to differences in the mindsets of the two
        participating parties. The employee is concerned about the impact of the review on
        his/her pay. This leads to the employee focusing on defending mistakes, justifying
        actions, promoting their accomplishments, and challenging the manager’s evaluations.
        At the same time the manager is trying to engage the employee in a discussion of how
        performance could be improved. The net result is that both parties feel frustrated by the
        discussion.
The purpose of performance review discussions should be on development and improvement.
Discussions about pay should occur separately and recognize that pay decisions are only partially
informed by performance. Organizational performance, the employee’s position within their pay
range, and external supply and demand factors also contribute significantly to pay decisions.

                                        OMNI LEADERSHIP
                  620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427
                                 952.426.6100 www.omnilx.com                                Page 10
A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT
                        BEST PRACTICES

PERFORMANCE MANAGEMENT – THE CORNERSTONE OF TALENT MANAGEMENT

Summary Conclusions:
It appears that performance management practice does not deliver on the promise of real value
for most organizations. Best in class organizations are realizing real value and it is the direct
result of applying best practices. In these organizations, senior leaders consider performance
management a key aspect of the organization’s culture and drive enterprise-wide usage. They
provide visibility to organizational goals and ensure that employee goals are linked to broader
business goals to accomplish focus and alignment of efforts.

Wide spread and consistent practices are enabled by practical, simple, and easy to use
technology. In addition to simplicity in technology, there is discipline in only focusing on those
goals and metrics that truly matter to keep administrative overhead to a minimum.

In addition to infrastructure, measurements, and processes, there is recognition that managers
need training in specific performance management skills. Effective organizations provide ready
access to core training and just in time refresher skill training.

There is a balanced approach to managing performance. Result goals are important but
competency performance is also considered a necessary component of the process. Competency
development is supported by multi-rater or 360 surveys, formal developmental planning, and
ready access to developmental content, processes, and forms.

Following these best practices should allow all organizations to realize the value promise of
performance management.




                                        OMNI LEADERSHIP
                  620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427
                                 952.426.6100 www.omnilx.com                                Page 11
A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT
                        BEST PRACTICES

IDENTIFYING HIGH POTENTIALS – PREPARING FOR THE FUTURE
Overview

According to a recent Wall Street Journal article, just 68% of companies formally identify high
potentials and only 28% of companies tell the employees they have been identified as high
potential individuals. It is hard to believe that if the individual is unaware they have been labeled
as such, that they are receiving any differential investment in their development. The data was
based on a survey by Towers Watson of 316 organizations in North America. I am willing to bet
these organizations were larger organizations and the true percentage of companies with high
potential programs is actually lower.

There are two reasons why more organizations do not have high potential programs:

   1. Advancement Potential is a difficult construct to measure accurately
   2. Developing high potentials requires structured processes and considerable resource and
      focus

Measuring advancement potential in many organizations is just a popularity contest, a highly
subjective opinion that is proven wrong too often when high potential individuals fail to succeed
when they advance. High potential programs with high failure rates can be demoralizing rather
than positive and some organizations shy away from forming a program for this reason.

While high potential programs do require structured process, resource, and focus, can
organizations really afford not to implement such programs? In a recent global survey of 80
companies, 69% of companies say they are "somewhat" or "significantly" challenged to develop
the leadership talent required to compete in emerging markets (Corporate University Exchange,
Leadership 2012 Survey). The future demands that leaders be ready with the skills and
knowledge to compete. Developing high potential individuals is the key to building the
necessary bench strength.

The Mystery of Potential - Common Approaches and Problems in Measuring Potential

High Potential is defined as having a high likelihood of advancing one or more levels in the
organization. It is a predictive measure of being able to successfully navigate transitions across
leadership levels. While the definition of potential may be relatively well understood, an
accurate measurement of potential is not.

Potential is not always readily apparent. It is a quality that lies within the individual, much like
DNA. What are the component parts of potential? This is the mystery of potential. Once we
can unlock the DNA of potential and identify the component parts, we can then decide on
appropriate measurement strategies.




                                        OMNI LEADERSHIP
                  620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427
                                 952.426.6100 www.omnilx.com                                  Page 12
A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT
                        BEST PRACTICES

IDENTIFYING HIGH POTENTIALS – PREPARING FOR THE FUTURE
The Mystery of Potential - Common Approaches and Problems in Measuring Potential (cont.)

Organizations repeatedly see individuals identified as high potential stagnate, struggle, or fail in
successfully making upward transitions. This suggests that significant problems exist with how
potential is measured today and how high potential individuals are identified. Companies clearly
recognize that these problems exist. In a recent global survey of 73 companies, 91% of
companies said they were challenged to identify high potential individuals early in their careers
(Corporate University Exchange, Leadership 2012 Survey).

There are three primary approaches used today to measure potential. Each approach and its
associated problems will be briefly discussed.

   1. Performance - The most common practice is to use performance in the current role as an
      indicator of future potential. The implicit assumption is that high performers also are
      high potentials. Fully 86% of all organizations, and 95% of larger ones, look at the past
      performance record of workers (May 2009 i4cp survey results).There are a number of
      problems with this approach. The most obvious is that the competencies and challenges
      faced in higher level positions are markedly different than competencies and challenges
      faced in lower level roles. There is little overlap in the requirements for success so there
      is little reason to believe that current performance in lower roles would be indicative of
      success in higher roles. It is not surprising that a survey conducted by the Corporate
      Leadership Council found that only “29% of high performers turned out to be high
      potentials”. However, performance is a readily available measure and in the absence of a
      conceptual model of potential, performance serves as a convenient but flawed measure of
      potential. While performance does not equal potential, it should play a contributing role
      in the identification of high potential individuals. It is a threshold condition. It is
      unlikely that an individual will be seen as having high potential for advancement if they
      are not successful in their current role.

   2. Manager Nominations Using Structured Judgment Frameworks – Another common
      approach is to ask the manager to make an informed judgment of potential considering a
      defined set of standard elements. This approach has the advantage of considering
      qualities other than performance and utilizes an implicit model of potential. In 2006, Fast
      Company polled 20 key leaders in 16 companies to identify the most frequently used
      elements in judging high potential. The following elements were identified:

               Ability to Execute:
                       Have they performed well in varied assignments and stretch assignments?
                       Do they excel in ambiguous situations?




                                        OMNI LEADERSHIP
                  620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427
                                 952.426.6100 www.omnilx.com                                Page 13
A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT
                       BEST PRACTICES

IDENTIFYING HIGH POTENTIALS – PREPARING FOR THE FUTURE
The Mystery of Potential - Common Approaches and Problems in Measuring Potential (cont.)

              Relationship Building /Influence/Communication Skills:
                     Can they build a strong case to influence their peers to their position/view?
                     What do others think of them?
                     What kind of impression do they make when I interact with them?

              Passion and Ambition:
                     Do they have a sense of urgency around taking on challenging and
                     important projects?

              Passion for Learning:
                     Do they have an openness to and passion for learning?
                     Are they highly motivated to continuously learn?

      While these elements are “future oriented”, there is still concern about the extent that
      current performance influences these judgments. There is also considerable concern
      about the potential for bias in using judgments from a single rater (manager).



   3. Higher Level Competency Models – Some companies recognize that the competency
      requirements for high level leadership roles differ from the competencies required in
      lower level roles and also recognize that a single rater approach invites personal bias.
      Therefore, they assess lower level leaders using competency models for higher level
      roles. Most commonly, this assessment is conducted through the use of a 360 or multi-
      rater survey. This approach is positive in that it is both future oriented and overcomes the
      reliability problems of measures from a single rater. However, there is a significant
      problem in the opportunity for observation. Multi-rater surveys assume that the raters
      have had sufficient opportunity to observe the core behaviors that define a given
      competency. This condition is not met in cases when raters are asked to rate behaviors
      that are not present or required in the current job. For example, it is difficult to obtain a
      reliable measure of “Developing Organizational Strategies” if an individual has no
      opportunity to perform the behaviors associated with the competency. When there is no
      demonstrated behavior to base a judgment, one has to rely on inference. In this case, one
      would have to infer future competence based on the individual’s understanding and
      analysis of the strategies developed by current senior leadership. However this inference
      may well be flawed since understanding strategies is demonstrated by different behaviors
      than those required for actually developing effective organizational strategies.




                                       OMNI LEADERSHIP
                 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427
                                952.426.6100 www.omnilx.com                                Page 14
A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT
                        BEST PRACTICES

IDENTIFYING HIGH POTENTIALS – PREPARING FOR THE FUTURE
A Conceptual Model of Potential and Best Practices for Measurement

The following conceptual model is proposed for both understanding the components of potential
and suggesting a measurement strategy. The elements of the model will be discussed and a
supporting rationale for each component will be presented.




The first component of the model focuses on the hard-wired aspects of potential, what we refer
to as “raw potential”. There are two core elements of raw potential:

           Behavioral Predispositions – Not everyone is naturally predisposed to assume
           leadership roles. There are certain core traits or characteristics that are associated
           with leadership advancement and success.

           Best Practice: Personality constructs with proven validity in predicting leadership
           success should be used as measures of this core element. Particularly useful are
           proven personality instruments that provide an “overall leadership predisposition
           scale”.




                                       OMNI LEADERSHIP
                 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427
                                952.426.6100 www.omnilx.com                                  Page 15
A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT
                        BEST PRACTICES

IDENTIFYING HIGH POTENTIALS – PREPARING FOR THE FUTURE
A Conceptual Model of Potential and Best Practices for Measurement (cont.)

           Cognitive Ability – There is increasing complexity in the challenges associated with
           higher level leadership roles. Individuals need superior mental abilities in order to
           understand and handle these complex problems, issues, and opportunities. Research
           shows that cognitive ability is the single best predictor of leadership success.
           However, not all cognitive abilities are necessarily valid predictors. Verbal reasoning
           does not emerge as a strong a predictor as numerical and abstract reasoning.

           Best Practice: Validated cognitive ability testing provides the best measure of this
           component of raw potential.

The second component of the model focuses on the motivations and career ambitions of the
individual. It reflects the extent that an individual is motivated to apply energy and effort to
develop their raw potential.

           Best Practice: Self-report measures can be used to gather key information on
           motivations and preferences. Some key motivations include:

               Interest in Advancement – A key consideration for identifying an individual as a
               high potential is their level of interest in advancement. The opportunities and
               challenges of senior leadership are not attractive to all individuals. They may
               prefer a career path that allows them to grow their technical expertise or broaden
               their scope of responsibilities within their current level of leadership.
               Achievement Orientation – Grooming oneself for senior leadership roles is hard
               work and often stressful. Individuals need to have a strong achievement drive to
               prepare for future roles while remaining high performers at their current level.

The third component focuses on the amount of relevant experience an individual has acquired at
a given point in their career. Leveraging experience is the primary method for leaders to
transform their raw potential and realize their true potential. This element is highly amenable to
development and targeted assignments or experiences can improve an individual’s advancement
potential. Research has shown that there are specific experiences that are associated with
leadership development and success. These specific experiences can be categorized into four
higher level factors:

               Managing a Business - Experience in managing core processes and activities
               related to the success of a business.
               Managing Relationships - Experience in managing interpersonal or business
               relationships.




                                        OMNI LEADERSHIP
                  620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427
                                 952.426.6100 www.omnilx.com                                 Page 16
A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT
                        BEST PRACTICES

IDENTIFYING HIGH POTENTIALS – PREPARING FOR THE FUTURE
A Conceptual Model of Potential and Best Practices for Measurement (cont.)


               Overcoming Challenge/Hardship – Experience in handling adversity, challenges,
               and problems.
               Managing Development – Experience in broadening one’s global business
               perspective and developing individual and group capabilities.


           Best Practice: Leadership experience is best measured using a research based
           inventory instrument.

The fourth and final element is demonstrated behavior. While there are significant differences in
the competency requirements for different levels of leadership, there is also some overlap. There
are core competencies that serve leaders at all levels and should be examined when considering
potential. Examples of these areas include:

               Interpersonal influence
               Communication skills
               Adaptability
               Emotional control
               Integrity

           Best Practice: A multi-rater survey provides an economical and reliable measure of
           demonstrated behavior in core competency areas.

Standardized tools with appropriate norms provide the basis for integrating the overall
personality data, cognitive ability data, and experience data. These data can be combined into a
single norm based percentile standing. The recipe mix for integrating these data is an important
consideration to mitigate possible adverse impact effects while retaining predicting power.




                                       OMNI LEADERSHIP
                 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427
                                952.426.6100 www.omnilx.com                               Page 17
A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT
                        BEST PRACTICES

INDIVIDUAL AND GROUP DEVELOPMENT
Overview of 360 Surveys for Developmental Planning

The underlying assumption behind developmental 360 feedback systems is that an individual’s
self -awareness and perceived need for change will be enhanced by a systematic process of
introspection and the review and comparison of ratings from others (Church & Bracken, 1997).

However, traditional multi-rater approaches have shown a low level of agreement between self
and “Other’s” ratings. Self- ratings are typically higher than “Other’s” ratings by as much as one
half a standard deviation (Harris & Schaubroeck, 1988). This presents a challenging feedback
situation where there is little agreement between self- perceptions and other’s perceptions and
other’s ratings are generally much lower. Individuals may discount the ratings of other’s or
become defensive and de-motivated by the lower rating values.

Clearly, self-awareness is a key ingredient for performance improvement. The degree to which a
discrepancy exists between an individual’s self- rating and the average rating made by “Other’s”
in a 360 process has been conceptualized as an indication of the amount of self-awareness
possessed by the individual. Small differences are an indication of high self-awareness while
large differences would be seen as indicative of low self-awareness.

In addition to self-awareness, other factors have also been shown to have a systematic effect on
differences between self and “Other’s” ratings. The degree of direct contact between raters and
the target individual can contribute to rating differences (Pollack & Pollack, 1996). The nature
of the competency being rated can also contribute to differences between self and other’s ratings.
Lower levels of agreement are associated with ambiguous (difficult to observe) competencies,
higher levels of agreement are associated with more concrete (observable) competencies (Dai,
Stiles, Hallenbeck, & DeMeuse, 2007).

High levels of self – others agreement have been associated with a number of positive outcomes
relevant for human resource practitioners. Some of these positive outcomes include perceived
need for change (London & Smither, 1995), performance improvement after feedback (Atwater
& Yazmmarino, 1992; Atwater et al., 2005; Johnson & Ferstl, 1999) and leadership effectiveness
(Atwater, Rouch, & Fischthal, 1995).

While self-ratings are typically viewed as unreliable and excluded in the calculation of
competency performance in 360 feedback reports, there is evidence that self-ratings can be
reliable and valid measures in certain circumstances. In a study conducted by the US Army
Research Institute, self- ratings were found to have a stronger correlation with leadership ability
than either peer or superior ratings (Psotka, Legree, & Gray, 2007). It was hypothesized that a
structured process consisting of regular superior reviews facilitated an accurate introspection and
was responsible for the strength of the correlation.



                                       OMNI LEADERSHIP
                 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427
                                952.426.6100 www.omnilx.com                                Page 18
A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT
                         BEST PRACTICES

INDIVIDUAL AND GROUP DEVELOPMENT
An Alternative Approach

Is a lack of self-awareness responsible for low self-other agreement? It could easily be argued
that the degree to which a discrepancy exists between an individual’s self- rating and the average
rating made by “Others” in a 360 process should be an indication of the amount of self-
awareness possessed by the individual. Small differences would be an indication of high self-
awareness while large differences would be seen as indicative of low self-awareness. I suspect it
is not because individuals have such little self-awareness. It probably has more to do with the
traditional 360 process which creates a scenario which encourages self-promotion.

Omni has developed a unique approach to multi-rater surveys that was designed to maximize
self-awareness and show higher congruence in self-other’s ratings compared to traditional
approaches. In this process, the individual rates their performance in comparison to structured
performance standards for each behavior within a competency. The self -ratings are then shared
with the other raters along with the performance standards to gather their perceptions of
agreement or disagreement. The combination of structured performance standards with a
transparent sharing of the ratings to others is felt to drive higher levels of introspection and self-
awareness.

We recently put this to a test in a research study with one of our client organizations. The results
were amazing. There was a highly significant relationship between self-ratings and the ratings
by others and no significant differences in their means. In fact, the self-ratings were slightly
lower than the ratings of others. It appears the Omni 360 process corrected the past problems
with inflated self-ratings and low self-other agreement. Of course, there is always a caution to
not overly extrapolate from a single study but these are pretty amazing results.

The benefits of this approach are most likely seen in performance feedback sessions and
subsequent developmental planning. These sessions will not have the difficult task of
overcoming potential defensiveness associated with other’s perceptions being much lower than
the individual’s self-perceptions. The higher agreement between self and others should also
make it easier for the individual to accept identified development needs as being accurately
measured which should increase their willingness to act on the data. Finally, the more thoughtful
introspection driven by the Omni process should help predispose the individual to receiving
feedback since they have already thought carefully about their true strengths and development
needs.




                                        OMNI LEADERSHIP
                  620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427
                                 952.426.6100 www.omnilx.com                                   Page 19
A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT
                        BEST PRACTICES

INDIVIDUAL AND GROUP DEVELOPMENT
An Alternative Approach (cont.)

There are likely to be other benefits to higher self-other agreement including a higher willingness
to participate in future 360 surveys. The process should be seen as less threatening by the target
individuals.

Given the absence of proven research, we need to continue to rely on our common sense in
implementing effective multi-rater programs (but we need to challenge our underlying
assumptions). A broader list of preconditions for effectiveness likely would include:

         Acceptance of the data by the participant
         The relative trainability of the target competencies
         The quality of developmental planning
         The level of support and follow up provided
         Accountability for behavior change



Best Practices for Developing Talent

There are a number of proven approaches and best practices for developing talent. This list is
not exhaustive but contains proven strategies:

       Stretch Assignments – Experience matters. Experience is the primary way critical
       leadership skills are developed. However, the current roles of high potentials are not
       likely to routinely afford the kind of opportunities that are most transformational. The
       Center for Creative Leadership and others have researched the kinds of experiences that
       are most important for leadership development. Stretch assignments should be
       challenging in nature and designed to fill specific experience gaps.
       Learning by doing - Action Learning involves working with others to analyze an actual
       work problem and develop an action plan. The action learning team is typically cross
       functional and diverse in background which provides an opportunity to be exposed to
       other perspectives and parts of the business. Analyzing, planning, and implementing
       solutions provides a rich foundation for learning by doing and has immediate practical
       benefits for the organization.
       Leaders developing leaders – Mentoring and coaching relationships with more senior
       leaders are important to developing an appreciation for the realities and demands of
       higher level jobs. The mentor provides a window into senior roles and passes on
       important learning and insights that have been acquired from their experience.
       Professional career coaches may also be assigned to high potential individuals.



                                       OMNI LEADERSHIP
                 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427
                                952.426.6100 www.omnilx.com                                Page 20
A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT
                        BEST PRACTICES

INDIVIDUAL AND GROUP DEVELOPMENT
Best Practices for Developing Talent (cont.)

       Feedback – All learning involves some form of feedback but formalized feedback
       programs can be particularly effective. Feedback is typically focused on competencies
       that are important for a higher level of leadership and involve some form of assessment.
       The most powerful form of assessment utilizes behavioral simulations which parallel the
       actual demands of higher level positions. To maximize learning, feedback is provided
       immediately after participation in the simulation. More formal feedback is provided later
       in the form of a written report. This report is used to structure an individual development
       plan. Another common form of assessment is the use of multi-rater or 360 surveys. In
       this approach, individuals that surround the individual on a daily basis provide ratings of
       performance in specific competency areas. Again, the feedback report is used to guide
       individual development plans.
       Job Rotations or Shadowing – Job rotations are used to increase exposure to the business
       as a whole. The individual is systematically moved laterally into temporary assignments
       in various parts of the business. These assignments may last a year or more and provide
       an opportunity to acquire new knowledge, learn new skills, and build a broad based
       network of contacts. Another option is job shadowing where an individual is paired with
       another person already performing in the role to learn how to perform in that role.
       Blended Learning – Blended learningcan simply be defined as the use of two or more
       learning technologies to deliver training (e.g., instructor led training might be blended
       with online learning). Blended learning techniques are designed to take into account the
       different learning styles of individuals and to match learning methods with the task or
       skill to be learned.

Developing talent takes more than effective developmental processes. It demands a carefully
planned program with administrative controls, evaluation components, and organizational
commitment. However, proven developmental strategies are a definite pre-requisite for success.




                                       OMNI LEADERSHIP
                 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427
                                952.426.6100 www.omnilx.com                               Page 21
A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT
                        BEST PRACTICES

SUCCESSION PLANNING – DEVELOPING BENCH STRENGTH
Overview

Upcoming baby boomer retirements coupled with high executive failure rates and ever shrinking
and flattening organizations have caused corporate directors, CEO’s, and Senior Human
Resource professionals to wonder where successors are going to come from and how ready will
they be to assume key roles. There is little confidence in current practice:

       16% of corporate directors feel they are effective at succession planning (National
       Association of Corporate Directors, 2008)
       38%of HR leaders rate their succession management practices as effective or very
       effective (High Impact Succession Management Study, 2009 Center for Creative
       Leadership)
       70% of organizations surveyed plan to modify their succession planning processes
       (Succession Management Survey 2006, Institute for Corporate Productivity)


Why the wide-spread dissatisfaction with succession management?

Problem 1: The Basics are Not in Place – Limited Talent Measurements or Relevant Information

“Clearly identifying the characteristics (skills, knowledge, personality, etc.) required for
successful performance, and then evaluating talent against those characteristics must be at the
heart of any talent management system (Survey from the Conference Board 2008 Talent
Management Strategies Conference)”. In order to evaluate talent readiness for a key role, you
need three core elements:

       clear and sufficient definition of the requirements for success in the role.
       reliable and predictive talent measurements relevant to the requirements.
       a method for comparing or matching role requirements with talent profiles.

Too often, organizations naively feel that they “know” their leadership talent and key roles and
can make accurate subjective determinations of “fit” and “readiness” of potential successors for
key roles. There are limited attempts to bring in objective data beyond personal observations and
opinions. These practices have resulted in high failure rates. A Manchester Consulting study
found that 40% of newly promoted leaders failed within the first 18 months of being placed in
the role. Another global study conducted by Development Dimensions International found that
one third of internally sourced leaders fail.




                                       OMNI LEADERSHIP
                 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427
                                952.426.6100 www.omnilx.com                               Page 22
A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT
                        BEST PRACTICES

SUCCESSION PLANNING – DEVELOPING BENCH STRENGTH


Problem 2: Limited Consideration of the Business Context

While the first problem focuses on a lack of talent measurement, this problem focuses on a
failure to consider unique situational or work context variables. A CIO position in one company
may demand a very different set of executive qualities than a position in another company even
though their position descriptions may read very similarly. This is because so much of
leadership success depends on the business context surrounding a role. What are the key
challenges facing the role? Updating and integrating internal systems? Creating a new product
development vision and implementing new product development processes? What is the culture
of the company? Is it entrepreneurial? Is it overly conservative? What are the key stakeholders’
and senior executive teams’ characteristics and expectations? Who will fit in and who will not?
How is the role evolving? Is what is required today going to fit with the future?

Is there a good fit between their motivations and preferences and the realities and opportunities
of the future role? For example, if they are highly motivated by entrepreneurial opportunities,
are they a good fit for a future role that offers limited entrepreneurial opportunity? What is their
interest in advancement, travel, or global assignments? These interests may have significant
impact on their “fit” for certain future roles.



The Core of Succession Planning – A Best Practice Talent Review Process

The information gathered in a talent review process varies across organizations but the purpose
of the talent review should be the same:

                           1.    Confirm that the talent is a top performer
                           2.    Assess the level of advancement potential possessed by the
                                 individual
                           3.    Ascertain the level of readiness to assume greater responsibility
                                 now
                           4.    Plan appropriate development activities

Let’s look at the type of information that would be appropriate for accomplishing each purpose.




                                        OMNI LEADERSHIP
                  620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427
                                 952.426.6100 www.omnilx.com                                 Page 23
A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT
                        BEST PRACTICES

SUCCESSION PLANNING – DEVELOPING BENCH STRENGTH
The Core of Succession Planning – A Best Practice Talent Review Process (cont.)

Confirming that the talent is a topperformer – Two pieces of information areimportant. You
want to review the performance review history of the individual to determine the level and
consistency of results performance against goals. You would also want to review the history of
competency performance of the individual. This information may be part of the performance
review or obtained from 360 survey assessments. Ideally, the two dimensions of performance
would be plotted in a nine block report to confirm that the individual is achieving outstanding
results through the demonstration of exemplary behaviors.

Evaluating Advancement Potential – Earlier in this article, I put forth a quantitative approach
for actually measuring advancement potential. Ideally, subjective evaluations and quantitative
measurement would both be gathered and compared to validate the level of advancement
potential possessed by the individual at that point in time.

Evaluating Readiness to Advance – This judgment requires a definition of the requirements of
performance at a higher level of leadership and a systematic comparison of the talent against
each requirement to identify matches and non-matches. The talent profile is compared to the
requirement profile to determine the degree of “match”. Talent measurements and assessments
are a key component of creating a talent profile. The graphic below shows a match analysis for
some leadership experiences. The individual’s percentile norm standing is compared to the
criticality of each type of experience to determine if further development is needed:




                                       OMNI LEADERSHIP
                 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427
                                952.426.6100 www.omnilx.com                               Page 24
A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT
                         BEST PRACTICES

SUCCESSION PLANNING – DEVELOPING BENCH STRENGTH
The Core of Succession Planning – A Best Practice Talent Review Process (cont.)

Developmental Planning – The comparison of the talent profile to the job requirement profile
identifies the gaps that need to be addressed. As has been already discussed, a variety of
developmental strategies may be used to prepare the individual for greater responsibility and
advancement.

Developmental planning should also include a review of any possible derailers that might be
present. A derailer is a weakness that, if not addressed or improved, will likely prevent a
potential successor from achieving their true potential. Here is a list of some common derailers:
Derailing Behaviors

   1.   Shares confidential information
   2.   Takes credit for others’ actions
   3.   Fails to keep promises/commitments
   4.   Fails to listen or be open to others
   5.   Plays favorites
   6.   Intimidates or bullies
   7.   Loses composure under stress
   8.   Micro-manages
   9.   Fails to staff effectively

Derailing Characteristics

   1.   Overly critical or argumentative
   2.   Overly needy of approval
   3.   Arrogant or self-promoting
   4.   Overly reckless or impulsive
   5.   Risk averse
   6.   Low tolerance for ambiguity

Derailing Deficiencies

   1.   Lacks accountability/follow through
   2.   Lacks initiative
   3.   Lacks focus or priorities
   4.   Lacks self-awareness
   5.   Lacks awareness of others

In a best practice talent review, it takes very little time or effort to discuss whether the individual
displays any derailer tendencies. If there is evidence that one or more may exist, it makes good
sense to integrate the issue into the individual’s coaching and development plan. Addressing a
tendency early in one’s career can prevent that career from stalling or going into a tail spin later.


                                        OMNI LEADERSHIP
                  620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427
                                 952.426.6100 www.omnilx.com                                   Page 25
A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT
                        BEST PRACTICES

DEPLOYING TALENT – PUTTING THE RIGHT PERSON, IN THE RIGHT JOB, AT THE
RIGHT TIME
Overview

Employee selection is a critical component of effective Talent Management. A strong
employer brand can be a true competitive differentiator for an organization. Building a strong
brand starts with being concerned with the candidate experience during the selection process.
The initial experience of the candidate during the selection process is likely to have a major
impact on their view of the organization’s culture, their perception of the value being placed on
talent, and their perception of the sophistication of the organization’s talent management
processes.

Effective employee selection involves more than establishing a strong employer brand and
attracting and hiring superior talent. The key to effective selection is the ability to match the
right person for the right job at the right time. Retention rates, individual productivity, and
business competitiveness all hinge on effectively matching individuals to jobs. This white paper
provides an overview of common employee selection tools, identifies current trends that are
impacting how employees are selected and matched to jobs, and provides recommendations for
tool use.

A Review of Selection Tools and Best Practices

   1) Candidate Pre-screening Tools

       Candidate pre-screening refers to the initial evaluation of candidate qualifications at time
       of application. The purpose is to reduce a potentially large candidate pool to a more
       manageable number of candidates. While there is certainly a focus on efficiency in pre-
       screening candidates, there is also a concern about accuracy. You do not want to advance
       the wrong candidates or reject high quality candidates in the process. Three of the more
       common approaches to candidate pre-screening include:

           a) Resume Matching Technology – There are a number of technologies that have
              been developed to search resume content for key constructs, phrases, or words
              that are relevant for a given position. They provide a tremendous efficiency
              advantage over manual resume reviews. Unfortunately, they are not necessarily
              accurate.




                                       OMNI LEADERSHIP
                 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427
                                952.426.6100 www.omnilx.com                                Page 26
A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT
                       BEST PRACTICES

DEPLOYING TALENT – PUTTING THE RIGHT PERSON, IN THE RIGHT JOB, AT THE
RIGHT TIME
A Review of Selection Tools and Best Practices

   1) Candidate Pre-screening Tools


              Part of the problem is in the resume itself. According to research conducted by
              The Society of Human Resource Managers, over 53% of individuals lie about
              their resume in some way. Forbes Magazine has a list of the top lies people put
              on their resumes. Some of the more common ones include:

                 1.   Lying about your degree
                 2.   Playing with dates
                 3.   Exaggerating numbers
                 4.   Increasing previous salary
                 5.   Inflating titles


              Another problem is candidates have learned to “seed” their resume with key
              words and phrases that are likely to result in a false match with a particular
              resume search.

              Even when the resume is totally factual, it provides little information for truly
              differentiating individuals against the full range of job requirements for a position.

          b) Profile Matching Technology - The concept of matching people to opportunities
             based on profiles is very familiar to most people today with the proliferation of
             dating services that rely on this approach.

              The approach is quite straightforward. The talent creates a profile of core
              attributes relevant for their consideration as a candidate (e.g., industry experience,
              management experience, salary preferences, etc.) and the profile is matched to the
              position requirements provided by an employer. While conceptually sound in
              theory, in practice there are problems. Most candidates are not willing to
              complete a lengthy profiling process as a pre-screen. Lengthy profiles would
              result in a high rate of abandonment. Therefore, the candidate match is only
              based on a relatively small number of job requirements and many unqualified
              candidates are incorrectly identified as a good fit.

              In order to obtain a complete and useful requirement profile of a position for
              accurate matching, it is important to consider a number of characteristics. These
              characteristics could include:


                                      OMNI LEADERSHIP
                620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427
                               952.426.6100 www.omnilx.com                                  Page 27
A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT
                       BEST PRACTICES

DEPLOYING TALENT – PUTTING THE RIGHT PERSON, IN THE RIGHT JOB, AT THE
RIGHT TIME
A Review of Selection Tools and Best Practices

Candidate Pre-screening Tools


                     Background requirements – e.g., desired industry/functional experience,
                     management experience, certifications, education
                     Contextual requirements – e.g., compensation, travel, specific role
                     challenges, and organizational culture demands
                     Personality requirements – e.g., key characteristics and predispositions
                     that would facilitate meeting the demands of the positions
                     Experience requirements – e.g., critical experiences necessary to prepare
                     an individual to be successful in the position
                     Competency requirements – e.g., behavioral skills associated with
                     successful performance in the position
                     Unique requirements – any special or unique requirements associated with
                     the position


              It is for this reason job/talent matching is more appropriately applied later in the
              selection process when the candidate is more motivated to provide a complete
              profile.

          c) Scored Application Forms- The application form is also a traditional source for
             evaluating candidate potential. There is typically a lot of overlap in information
             provided by a resume and information requested on an application form. The
             primary difference is the application form is a structured process that solicits the
             same information from all candidates. It overcomes the problem of difference in
             resume content and formats. It also allows the addition of specific questions
             regarding qualifications, preferences, and experiences that are important to the
             employer.

              Application items can be assigned a particular weight and value for different
              responses. Automated routines can be used to score application forms thereby
              eliminating the subjectivity of manual reviews and also addressing the criterion of
              efficiency. They need not be overly long and still provide relevant information
              concerning the full range of requirements. Scored application blanks have also
              been shown to be reasonably accurate (Reilly and Chao, 1982; and Schmitt, Noe,
              & Kirsch, 1984)




                                      OMNI LEADERSHIP
                620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427
                               952.426.6100 www.omnilx.com                                  Page 28
A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT
                       BEST PRACTICES

DEPLOYING TALENT – PUTTING THE RIGHT PERSON, IN THE RIGHT JOB, AT THE
RIGHT TIME
A Review of Selection Tools and Best Practices

   1) Candidate Pre-screening Tools (cont.)
         d) Custom Screening Questionnaires – Custom screening questionnaires are similar
            to application forms but are designed specifically for a particular job. Structured
            questions that relate to the specific requirements of the job are created. These
            questionnaires are most commonly presented online and scored in real time.
            Differential weights are applied to candidate responses to create a weighted score.
            Knock out factors on mandatory requirements are included. Resume data are also
            captured and can be potentially scored.

       Current Trends and Best Practices for Candidate Pre-Screening

       Technology providers are increasingly integrating screening questionnaires and resume
       review processes into selection workflow capabilities. The trend is to move beyond
       simple efficiencies in selection to being concerned with quality of hire.Custom screening
       questionnaires are recommended as the preferred method for candidate pre-screening.
       They are highly efficient, provide a structured approach for reviewing candidates, and are
       able to collect the job specific information necessary for making an accurate screening
       decision. One would review the resumes of screened-in candidates before making a
       progression decision.

       Profile matching technology is recommended as an important component of the selection
       process which would be used later when candidates are willing to provide a complete
       talent profile.

   2) Pre-Employment Tests

   Pre-employment tests are quite prevalent today. According to a recent survey roughly 86%
   of companies are using some form of pre-employment testing. While there are a large
   number of different types of tests available, the two most common are:
         a. Ability Tests– While there are a large number of different kinds of ability tests,
             the most common type of ability test is a measure of cognitive or mental ability.
             There is abundant evidence that this type of test is a strong predictor of overall
             performance across a wide range of jobs. In an often cited paper, Schmidt &
             Hunter (2004) provide evidence that general mental ability “predicts both
             occupational level attained and performance within one’s chosen occupation and
             does so better than any other ability, trait, or disposition and better than job
             experience” (p. 162). There are three common types of mental ability tests.


                                       OMNI LEADERSHIP
                 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427
                                952.426.6100 www.omnilx.com                              Page 29
A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT
                       BEST PRACTICES

DEPLOYING TALENT – PUTTING THE RIGHT PERSON, IN THE RIGHT JOB, AT THE
RIGHT TIME
A Review of Selection Tools and Best Practices

                    i.   Verbal Reasoning – Verbal Reasoning is the ability to understand and
                         reason using concepts framed in language. Critical thinking skills are
                         commonly measured with these tests.
                   ii.   Numerical Reasoning- Numerical reasoning is the ability to use
                         numbers to develop, comprehend, and communicate ideas. Basic math
                         skills are essential to having good numerical reasoning skills.
                  iii.   Abstract Reasoning - Abstract Reasoning is the ability to recognize
                         abstract patterns, associations, or relationships without using words or
                         numbers. Different from both Verbal and Numerical Reasoning,
                         Abstract Reasoning is right-brain dominated. It is a measure of an
                         individual’s ability to perceive and think clearly, make meaning out of
                         confusion, and formulate new concepts when faced with novel
                         information.

              The main drawback to mental ability testing is evidence of adverse impact on
              minority populations. Diversity goals are negatively affected by this type of
              testing. Therefore, it is common practice to combine such tests with other tests or
              selection procedures to dilute their adverse impact.

          b. Personality Tests-Although personality tests measure a variety of specific
             constructs, these constructs typically collapse to five basic factors of personality.
             These factors, commonly called “the big five”, include: (1) openness to
             experience, (2) extroversion, (3) agreeableness, (4) conscientiousness, and (5)
             emotional stability. There is growing evidence of the usefulness of these factors
             in predicting job performance (Barrick, M.R. & Mount, M.K., 1991).

              When using personality tests, it is important to use those that were specifically
              developed for selection rather than for general research on individual differences.
              It is equally important to review the validity evidence for any selected instrument.
              Additionally, there are concerns that candidates may be successful in faking
              personality instruments. It is therefore important to select an instrument that
              contains a well-designed “faking” scale as a key construct.

              The lack of adverse impact and the consistent evidence of validity have made
              personality testing a frequent component of selection procedures.




                                      OMNI LEADERSHIP
                620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427
                               952.426.6100 www.omnilx.com                                 Page 30
A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT
                       BEST PRACTICES

DEPLOYING TALENT – PUTTING THE RIGHT PERSON, IN THE RIGHT JOB, AT THE
RIGHT TIME
A Review of Selection Tools and Best Practices

       Current Trends and Best Practices for Candidate Pre-Screening

       There is increasing support for a different type of norm based test called an Experience
       Inventory. Everyone intuitively knows that experience matters when considering the
       qualifications of a candidate…but which experiences? Extensive research on the types of
       experiences that lead to leadership success has surfaced specific themes. Items have been
       created for these themes which has led to the construction of norm based experience
       inventories. These inventories are showing early promise as a new type of valid
       predictor.

       There is also a trend toward non-proctored web-based testing to provide greater
       convenience for the test taker.

       A recommended approach is to combine personality testing, experience inventories, and
       mental ability testing to optimize the amount of predictive information that is gathered
       while minimizing the adverse impact of the mental ability test. It is also recommended to
       use numerical reasoning and abstract reasoning rather than verbal reasoning tests to
       further lessen adverse impact. Short forms of tests should be used when available to
       reduce the time required for test completion. Generally, testing should usually be
       positioned later in the selection process with candidates that have passed earlier hurdles
       and are motivated to complete the testing process. Test results should be used in
       matching talent profiles to job requirements.

   3) Interviews

   Interviews are the most ubiquitous selection tool in use today. They are also the selection
   method with the poorest execution. Many interviews are more of a “personal chemistry”
   check than a reliable and accurate evaluation of qualifications. Interview practices can be
   sorted into two basic categories:

          a. Structured Behavioral Interviews -There is a considerable body of research that
             supports the power of the interview when it is a structured process. When
             interviews are structured, they have considerable reliability and predictive value
             and are a powerful selection tool.




                                       OMNI LEADERSHIP
                 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427
                                952.426.6100 www.omnilx.com                               Page 31
A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT
                       BEST PRACTICES

DEPLOYING TALENT – PUTTING THE RIGHT PERSON, IN THE RIGHT JOB, AT THE
RIGHT TIME
A Review of Selection Tools and Best Practices

              Structured interviews:
                  Use competencies as the framework for structuring the interview.
                  Competencies are based on a job analysis which is a systematic review of
                  what it takes to be successful in a particular job.
                  Use pre-planned interview questions that are linked to competency
                  requirements. This ensures that the interview questions are job related. Pre-
                  planned questions also ensure that the same questions are asked of each
                  candidate to ensure consistency and “apple to apple” comparisons. Every
                  candidate has the same opportunity to demonstrate they have the knowledge,
                  skills, and background to perform the job.
                  Use trained interviewers. Interviewers are trained in how to evaluate
                  responses to prepared questions. Training helps take the bias and subjectivity
                  out of the evaluation process and gives interviewers a common frame of
                  reference for evaluating candidates.
                  Ratings are integrated in a common way to arrive at an overall score as well as
                  a profile of strengths and weaknesses.


          b. Unstructured Interviews- Research suggests that when interviews are
             unstructured, they are little better than flipping a coin. Unstructured interviews
             are characterized by:

                 Each interviewer decides where they would like to focus their information
                 gathering.
                 Each interviewer comes up with their own questions
                 Each interviewer uses their own evaluation framework for evaluating
                 responses
                 Each interviewer integrates the interviewee responses in their own way to
                 reach conclusions


       Current Trends and Best Practices for Interviews

       Web-based interviewing solutions are now available in the market to help drive
       consistency, accuracy, and to reduce legal exposure. These interviewing platforms also
       make it easier to deploy and bring value to competency modeling efforts.Combine online
       interviewer training with an online interviewing management system to create structured
       interviews, manage the entire interview process, and equip interviewers with the tools
       and skills to conduct accurate interviews.



                                      OMNI LEADERSHIP
                620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427
                               952.426.6100 www.omnilx.com                                Page 32
A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT
                        BEST PRACTICES

   4) Behavioral Simulations

       Simulations are designed to mirror important challenges within a particular job. When
       properly designed, they provide candidates with a realistic view of the skill requirements
       of the position and provide a forum for the candidate to demonstrate job relevant skills in
       a high fidelity representation of critical job demands.

       Current Trends and Best Practices

       There are an increasing number of web-based simulations. Virtual reality technology is
       transforming the ability to simulate realistic work challenge and capture realistic
       candidate responses. However, it will still be some time before technology can replace
       trained assessors for providing insightful feedback and maximizing developmental
       impact.Use behavioral simulations at the executive level – The time and costs associated
       with simulations and trained assessors can be justified at the executive level. The impact
       of an executive’s performance on the organization argues strongly to take the time to
       thoroughly review candidate skills and qualifications.



MANAGING RETENTION AND TURNOVER
The Difference Between Wanted vs. Unwanted Turnover

Not all turnover is bad. In fact, turnover rates that are very low could well be damaging to an
organization. Very low turnover is likely an indication that poor performance is being tolerated.
Every organization has some level of poor performers that are not responsive to coaching, and
should be released (or placed in position that is a better fit). There is also likely some level of
bad managers that are having even greater negative impact than poor performing individual
contributors. It could even be argued that losing an average performer is not bad, if they are
replaced with a superior performer. Upgrading the talent in an organization is both a function of
internal development and effective external selection.

Very low turnover also restricts the amount of new ideas and perspectives that are coming into
the organization, which could easily stifle innovation and bring about stagnation. There could
also be a situation where the business strategy is not in alignment with the talent currently
available in the organization. Individuals with different knowledge, skills, or experiences may
be needed from the outside to execute the business strategy.

An organization’s retention goal should be to reduce unwanted turnover. Unwanted turnover
would include turnover of top performers, key leaders, high potential individuals, and individuals
with business strategy critical skills. Unwanted turnover would also include individuals with key
client relationships or other contacts, top revenue producers, and innovators or thought leaders.


                                       OMNI LEADERSHIP
                 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427
                                952.426.6100 www.omnilx.com                                 Page 33
A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT
                        BEST PRACTICES

MANAGING RETENTION AND TURNOVER
A Model of Turnover

As the economy improves, turnover is likely to become a major concern for organizations.
Unwanted turnover represents costs that are greater than simple replacement costs. The costs of
losing a good performer are greater than the costs of losing an average performer. The true cost
of losing a key seasoned player is hard to estimate. There is the investment in development of
the employee, the value of the knowledge and experience gained, and the lost productivity, that
also have to be considered to arrive at a true cost figure. However, much turnover (up to 50% or
more) occurs within the first six months of employment and, in an early departure scenario, the
bulk of the costs are replacement costs. When an organization starts to lose significant numbers
of senior employees, it is usually indicative of even more serious organizational problems.

However, the factors that influence turnover rates go well beyond organizational problems.
Organizational characteristics are only one of the variables that will impact an organization’s
turnover rate. To understand the variables that impact turnover, I have provided the following
model:



                 Economic Trends

                         Industry Trends

                              Organizational Characteristics

                                 Leadership and Culture

                                    Job Characteristics

                                           Individual
                                           Characteristics




                                       OMNI LEADERSHIP
                 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427
                                952.426.6100 www.omnilx.com                               Page 34
A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT
                        BEST PRACTICES

MANAGING RETENTION AND TURNOVER
A Model of Turnover

Economic Trends-In this model, the overall economy sets the stage for alternative employment
opportunities. Generally, in a tight economy, there are less alternative opportunities. Employees
are less willing to leave their current jobs, even if they are dissatisfied.

Industry Trends- Industry trends interact with the general economy. Let’s take the example of
the high tech industry. High tech is fueling a significant portion of the general economy. In a
high tech economy, there is a premium placed on up-to-date training, which has the impact of
heightening job opportunities for recent graduates, but reducing opportunities for workers over
50 years of age. A booming high tech industry also tends to create fewer lower wage jobs, limits
new opportunities for these jobs, but also creates a demand for more knowledgeable workers.
The opportunities for these workers are huge and makes for a “sellers” market. The net effect is
that turnover is very high in this industry, with a resulting heavy reliance on contract workers.

Organizational Characteristics- Nested within an industry is the specific organization. Within
any industry, there are some organizations that simply do a better job of retaining employees
than others. Some of this has little to do with enlightened practices and is simply a product of
workforce demographics. All things being equal, a younger workforce will have more job and
company changes than an older workforce. Part-time personnel are less stable than full-time
personnel, and a workforce with greater average tenure will have less turnover than a workforce
with less average tenure. Another key organizational characteristic is company performance.
People are less likely to leave a company that they identify with and can take pride in its positive
business and community performance.

Leadership and Culture are both strong determinants of turnover intentions. Bad managers can
cause good employees to leave. Problems or conflicts with the immediate supervisor are one of
the most frequently mentioned reasons employees cite for leaving a company in their exit
interviews.Company culture is determined by a bunch of things but for discussion, let’s just
focus on company attitudes toward skill development and rewards/recognition.
        Skills - The emphasis an organization places on developing the skills of its employees
        will have an impact on turnover. Companies with low unwanted turnover rates tend to
        spend more money and time on skill development than those with high turnover rates.
        Rewards/Recognition – The philosophy of the company concerning pay will impact
        turnover. A recent study by Spherion indicated that 69% of employees considered pay to
        be a key driver of retention. Companies that are willing to pay for top talent generally are
        more likely to retain that talent. However, rewards don’t have to be monetary in order to
        have an impact. Positive feedback, formal recognition programs, and challenging and
        interesting work assignments are all ways to provide rewards and recognition for top
        talent.



                                        OMNI LEADERSHIP
                  620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427
                                 952.426.6100 www.omnilx.com                                Page 35
A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT
                        BEST PRACTICES

MANAGING RETENTION AND TURNOVER
A Model of Turnover

Job Characteristics impact job satisfaction which in turn impacts turnover. Research suggests
the following job characteristics are impact job satisfaction:

       Variety – Jobs that offer a greater variety of tasks are associated with higher satisfaction
       levels
       Autonomy – Jobs that offer greater freedom and choice in execution (i.e., empowerment)
       are associated with higher satisfaction levels
       Identity – Jobs that offer a sense of ownership and personal accountability are associated
       with higher satisfaction levels
       Feedback – Jobs that offer intrinsic feedback on quality of performance are associated
       with higher satisfaction levels, and
       Significance – Jobs that are perceived as important are associated with higher job
       satisfaction.

Individual Characteristicsare the final determinant of turnover. There are intrinsic individual
differences that affect turnover as well as individual situational factors. Risk adverse individuals
with higher needs for security are generally less likely to turnover. Individuals with local ties or
financial dependencies are generally less likely to turnover.

A recent retention study by the University of Minnesota compared individual differences
between “leavers” and “stayers” in seven different organizations over a time period of 20
months. Leavers generally had (1) lower perceived costs of a job change, (2) lower
organizational commitment or identification with the company, (3) lower job satisfaction, and/or
(4) had a negative recent experience or event in the company.

Best Practices for Managing Unwanted Turnover

While there are many possible strategies to reduce unwanted turnover, I would like to focus on
six key areas:

       Early Interventions
       Skill Interventions
       Leadership Interventions
       Rewards/Recognition Interventions
       Selection Interventions
       Job Enrichment




                                        OMNI LEADERSHIP
                  620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427
                                 952.426.6100 www.omnilx.com                                Page 36
A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT
                        BEST PRACTICES

MANAGING RETENTION AND TURNOVER
Best Practices for Managing Unwanted Turnover

Early interventions – The fact that large numbers of employees turnover in the first six months of
employment suggests that this is a critical time for helping people adjust to new roles. Effective
on-boarding programs should cover this critical period. A good on-boarding program helps
prevent misunderstandings, gradually introduces the employee into the organization, and
provides just in time information and training. Most importantly, establish a support system for
the new employee. A good practice is to set up a “buddy” system for new employees. A
“buddy” is a seasoned employee who volunteers to “look out for the new employee”, making
introductions, providing advice, and helping avoid early pitfalls.

Skill interventions– Keep employees motivated and committed by enthusiastically offering
training and development opportunities. Smart companies know the importance of personal
development in employee retention. Top rated companies to work for have several qualities in
common. They spend considerable time in training their people, they have low turnover rates,
and they have impressive numbers of applicants per job opening.

Leadership interventions – Better Bosses mean lower turnover. Establishing performance
expectations, providing coaching and positive feedback, and interacting in a fair and considerate
manner are all things that good leaders do to help new employees be successful and receive
enjoyment from their jobs. To impact turnover, make sure that supervisory promotion and
training programs have interpersonal skills as part of their focus. Measure employee perceptions
of leadership behaviors and incorporate behavioral expectations into leaders’ performance
management expectations.

Rewards/recognition interventions – Various kinds of contingent bonus strategies can be used to
help with retention. Deferred bonuses are paid out incrementally with a significant back-end
payoff for a combination of performance and retention. This type of bonus system can help
guarantee service for a finite number of years but doesn’t address long term retention.
Performance bonuses can help an employee reach high levels of income providing they can
consistently demonstrate superior levels of performance. This type of bonus can be very
effective if performance metrics are readily available and additional costs are consistent with the
value of superior performance. If you can’t afford to pay more, or offer contingent pay, don’t
forget the value of non-monetary or symbolic rewards like time-off, awards, and other
recognition programs.




                                        OMNI LEADERSHIP
                  620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427
                                 952.426.6100 www.omnilx.com                                Page 37
A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT
                        BEST PRACTICES

MANAGING RETENTION AND TURNOVER
Best Practices for Managing Unwanted Turnover

Selection interventions– Perhaps the most powerful weapon against turnover is improved
selection. A well-known consulting company documented 21 studies of the impact on turnover
of introducing a structured interviewing selection system. Improving interviewing procedures
reduced turnover rates on average a whopping 42%. Putting the right person, in the right job, at
the right time, is critical to effective talent management and to preventing unwanted turnover.

Job enrichment– Increasing the job satisfaction of high turnover jobs can reduce turnover. For
individuals who have a need for growth, the following job design strategies are associated with
increased job satisfaction:

       Increase the variety of tasks performed
       Provide greater ownership and decision-making on how the job is performed and hold the
       job holder accountable for quality of outputs
       Add more significant responsibilities
       Improve the accuracy and quality of feedback on performance




                                       OMNI LEADERSHIP
                 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427
                                952.426.6100 www.omnilx.com                              Page 38
A Comprehensive Review Of Talent Management Best Practices 10 25 11

Weitere ähnliche Inhalte

Andere mochten auch

The New Model for Talent Management: Agenda for 2015
The New Model for Talent Management:  Agenda for 2015The New Model for Talent Management:  Agenda for 2015
The New Model for Talent Management: Agenda for 2015Josh Bersin
 
Creative problem solving
Creative problem solvingCreative problem solving
Creative problem solvingVijayKrKhurana
 
Presentation on Talent Development
Presentation on Talent DevelopmentPresentation on Talent Development
Presentation on Talent DevelopmentTim Weyland
 
Master Class on Talent Management & Engagement - Deepa Mohamed
Master Class on Talent Management & Engagement - Deepa MohamedMaster Class on Talent Management & Engagement - Deepa Mohamed
Master Class on Talent Management & Engagement - Deepa MohamedCorporateShiksha
 
Best Practices of Retention
Best Practices of RetentionBest Practices of Retention
Best Practices of RetentionLAWRENCE A
 
[Read me first] AIESEC FTU HCM_BEST TALENT MANAGEMENT APPLICATION IGNITE 2014
[Read me first] AIESEC FTU HCM_BEST TALENT MANAGEMENT APPLICATION IGNITE 2014[Read me first] AIESEC FTU HCM_BEST TALENT MANAGEMENT APPLICATION IGNITE 2014
[Read me first] AIESEC FTU HCM_BEST TALENT MANAGEMENT APPLICATION IGNITE 2014Tank Bom
 
Succession Planning By Vivek
Succession Planning By VivekSuccession Planning By Vivek
Succession Planning By VivekVivek Mehrotra
 
WWS Presentation - Succession Planning
WWS Presentation - Succession PlanningWWS Presentation - Succession Planning
WWS Presentation - Succession PlanningMolly Morales
 
Succession planning Keynote workshop - Michigan - Talent Management
Succession planning   Keynote workshop - Michigan - Talent ManagementSuccession planning   Keynote workshop - Michigan - Talent Management
Succession planning Keynote workshop - Michigan - Talent ManagementScott Patchin
 
My Leadership Habits = Needs Of My People? Talent Scorecard: An Assessment ...
My Leadership Habits = Needs Of My People?  Talent Scorecard:  An Assessment ...My Leadership Habits = Needs Of My People?  Talent Scorecard:  An Assessment ...
My Leadership Habits = Needs Of My People? Talent Scorecard: An Assessment ...Scott Patchin
 
Pt net dimensions-performance-4jun2013-org
Pt net dimensions-performance-4jun2013-orgPt net dimensions-performance-4jun2013-org
Pt net dimensions-performance-4jun2013-orgHoang Tuan
 
Sap solution brief stvn_20130111_english
Sap solution brief stvn_20130111_englishSap solution brief stvn_20130111_english
Sap solution brief stvn_20130111_englishMelloney_Jewell
 
Talent Scorecard - Wisconsin SHRM
Talent Scorecard - Wisconsin SHRMTalent Scorecard - Wisconsin SHRM
Talent Scorecard - Wisconsin SHRMScott Patchin
 
Indian Oil & Gas Leaders Conclave - Discussion Summary
Indian Oil & Gas Leaders Conclave - Discussion SummaryIndian Oil & Gas Leaders Conclave - Discussion Summary
Indian Oil & Gas Leaders Conclave - Discussion Summaryvsingha
 
#HROS: Open-Source Comes To HR | Ambrosia Vertesi & Lars Schmidt Talent Conne...
#HROS: Open-Source Comes To HR | Ambrosia Vertesi & Lars Schmidt Talent Conne...#HROS: Open-Source Comes To HR | Ambrosia Vertesi & Lars Schmidt Talent Conne...
#HROS: Open-Source Comes To HR | Ambrosia Vertesi & Lars Schmidt Talent Conne...LinkedIn Talent Solutions
 
Talent Scorecard for Grand Rapids SHRM Group
Talent Scorecard for Grand Rapids SHRM GroupTalent Scorecard for Grand Rapids SHRM Group
Talent Scorecard for Grand Rapids SHRM GroupScott Patchin
 

Andere mochten auch (19)

The New Model for Talent Management: Agenda for 2015
The New Model for Talent Management:  Agenda for 2015The New Model for Talent Management:  Agenda for 2015
The New Model for Talent Management: Agenda for 2015
 
Creative problem solving
Creative problem solvingCreative problem solving
Creative problem solving
 
Presentation on Talent Development
Presentation on Talent DevelopmentPresentation on Talent Development
Presentation on Talent Development
 
Master Class on Talent Management & Engagement - Deepa Mohamed
Master Class on Talent Management & Engagement - Deepa MohamedMaster Class on Talent Management & Engagement - Deepa Mohamed
Master Class on Talent Management & Engagement - Deepa Mohamed
 
Best Practices of Retention
Best Practices of RetentionBest Practices of Retention
Best Practices of Retention
 
[Read me first] AIESEC FTU HCM_BEST TALENT MANAGEMENT APPLICATION IGNITE 2014
[Read me first] AIESEC FTU HCM_BEST TALENT MANAGEMENT APPLICATION IGNITE 2014[Read me first] AIESEC FTU HCM_BEST TALENT MANAGEMENT APPLICATION IGNITE 2014
[Read me first] AIESEC FTU HCM_BEST TALENT MANAGEMENT APPLICATION IGNITE 2014
 
Succession Planning By Vivek
Succession Planning By VivekSuccession Planning By Vivek
Succession Planning By Vivek
 
Talent Management PPT
Talent Management PPTTalent Management PPT
Talent Management PPT
 
WWS Presentation - Succession Planning
WWS Presentation - Succession PlanningWWS Presentation - Succession Planning
WWS Presentation - Succession Planning
 
Succession planning Keynote workshop - Michigan - Talent Management
Succession planning   Keynote workshop - Michigan - Talent ManagementSuccession planning   Keynote workshop - Michigan - Talent Management
Succession planning Keynote workshop - Michigan - Talent Management
 
Talent Management
Talent ManagementTalent Management
Talent Management
 
My Leadership Habits = Needs Of My People? Talent Scorecard: An Assessment ...
My Leadership Habits = Needs Of My People?  Talent Scorecard:  An Assessment ...My Leadership Habits = Needs Of My People?  Talent Scorecard:  An Assessment ...
My Leadership Habits = Needs Of My People? Talent Scorecard: An Assessment ...
 
Pt net dimensions-performance-4jun2013-org
Pt net dimensions-performance-4jun2013-orgPt net dimensions-performance-4jun2013-org
Pt net dimensions-performance-4jun2013-org
 
Sap solution brief stvn_20130111_english
Sap solution brief stvn_20130111_englishSap solution brief stvn_20130111_english
Sap solution brief stvn_20130111_english
 
Social Media Recruiting Presentation1
Social Media Recruiting Presentation1Social Media Recruiting Presentation1
Social Media Recruiting Presentation1
 
Talent Scorecard - Wisconsin SHRM
Talent Scorecard - Wisconsin SHRMTalent Scorecard - Wisconsin SHRM
Talent Scorecard - Wisconsin SHRM
 
Indian Oil & Gas Leaders Conclave - Discussion Summary
Indian Oil & Gas Leaders Conclave - Discussion SummaryIndian Oil & Gas Leaders Conclave - Discussion Summary
Indian Oil & Gas Leaders Conclave - Discussion Summary
 
#HROS: Open-Source Comes To HR | Ambrosia Vertesi & Lars Schmidt Talent Conne...
#HROS: Open-Source Comes To HR | Ambrosia Vertesi & Lars Schmidt Talent Conne...#HROS: Open-Source Comes To HR | Ambrosia Vertesi & Lars Schmidt Talent Conne...
#HROS: Open-Source Comes To HR | Ambrosia Vertesi & Lars Schmidt Talent Conne...
 
Talent Scorecard for Grand Rapids SHRM Group
Talent Scorecard for Grand Rapids SHRM GroupTalent Scorecard for Grand Rapids SHRM Group
Talent Scorecard for Grand Rapids SHRM Group
 

Mehr von phauenst

Retention And Turnover
Retention  And TurnoverRetention  And Turnover
Retention And Turnoverphauenst
 
Tele Com Case Study 0511
Tele Com Case Study 0511Tele Com Case Study 0511
Tele Com Case Study 0511phauenst
 
Tvantage Suite Overview
Tvantage Suite OverviewTvantage Suite Overview
Tvantage Suite Overviewphauenst
 
Common Employee Selection Tools: Trends and Recommendations
Common Employee Selection Tools:  Trends and RecommendationsCommon Employee Selection Tools:  Trends and Recommendations
Common Employee Selection Tools: Trends and Recommendationsphauenst
 
Self Rating Research Paper
Self Rating Research PaperSelf Rating Research Paper
Self Rating Research Paperphauenst
 
Talent Management Redefined
Talent Management RedefinedTalent Management Redefined
Talent Management Redefinedphauenst
 
Succession Management - What\'s Missing
Succession Management - What\'s MissingSuccession Management - What\'s Missing
Succession Management - What\'s Missingphauenst
 
Value Promise Of Performance Management
Value Promise Of Performance ManagementValue Promise Of Performance Management
Value Promise Of Performance Managementphauenst
 

Mehr von phauenst (8)

Retention And Turnover
Retention  And TurnoverRetention  And Turnover
Retention And Turnover
 
Tele Com Case Study 0511
Tele Com Case Study 0511Tele Com Case Study 0511
Tele Com Case Study 0511
 
Tvantage Suite Overview
Tvantage Suite OverviewTvantage Suite Overview
Tvantage Suite Overview
 
Common Employee Selection Tools: Trends and Recommendations
Common Employee Selection Tools:  Trends and RecommendationsCommon Employee Selection Tools:  Trends and Recommendations
Common Employee Selection Tools: Trends and Recommendations
 
Self Rating Research Paper
Self Rating Research PaperSelf Rating Research Paper
Self Rating Research Paper
 
Talent Management Redefined
Talent Management RedefinedTalent Management Redefined
Talent Management Redefined
 
Succession Management - What\'s Missing
Succession Management - What\'s MissingSuccession Management - What\'s Missing
Succession Management - What\'s Missing
 
Value Promise Of Performance Management
Value Promise Of Performance ManagementValue Promise Of Performance Management
Value Promise Of Performance Management
 

A Comprehensive Review Of Talent Management Best Practices 10 25 11

  • 1. A Comprehensive Review of Talent Management Best Practices TALENT MANAGEMENT BEST PRACTICES A COMPREHENSIVE REVIEW OMNI LEADERSHIP 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com 1 OOMNI LMNI
  • 2. A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT BEST PRACTICES TABLE OF CONTENTS What is Talent Management? ........................................................................................ 3-7 Historical Roots ................................................................................................................. 3 The Impact of Technology ................................................................................................ 4 Moving Toward Effective Talent Management ........................................................... .5-7 Performance Management–Cornerstone of Talent Management…. ....................... 8-11 Overview ........................................................................................................................... 8 Best Practices – The Keys to Delivering Value .......................................................... 9-10 Summary Conclusions.................................................................................................... .11 Identifying High Potentials – Preparing for the Future .......................................... 12-17 Overview ......................................................................................................................... 12 The Mystery of Potential – Common Approaches & Problems in Measuring Potential .................................................................................................. 12-14 A Conceptual Model of Potential and Best Practice for Measurement ................................................................................................. .15-17 Individual and Group Development.......................................................................... 18-21 Overview of 360 Surveys for Developmental Planning.................................................. 18 An Alternative Approach .......................................................................................... 19-20 Best Practices for Development Talent .................................................................... .20-21 Succession Planning – Developing Bench Strength ................................................. 22-25 Overview ................................................................................................................... 22-23 The Core of Succession Planning – A Best Practice Talent Review Process .................................................................................... 23-25 Deploying Talent – Putting the Right Person in the Right Job Job at the Right Time .............................................................................................. 26-33 Overview ......................................................................................................................... 26 A Review of Selection Tools and Best Practices ...................................................... 26-33 Managing Retention and Turnover........................................................................... 33-38 The Difference Between Wanted vs. Unwanted Turnover ............................................. 33 A Model of Turnover ................................................................................................ 34-36 Best Practices for Managing Turnover ...................................................................... 37-38 References .......................................................................................................................... 39 OMNI LEADERSHIP 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com Page 2
  • 3. A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT BEST PRACTICES WHAT IS TALENT MANAGEMENT? Historical Roots The term Talent Management was first coined in an often cited 1997 article by McKinsey, which focused on the emerging “war for talent”. Popularized in the 2000’s, various pundits have offered a definition. Dr. John Sullivan, a popular expert on the subject, suggested in a 2004 Electronic Recruiter Exchange article that four key factors distinguish Talent Management from traditional HR approaches: 1. An integrated approach within HR 2. Integrating people processesinto standard business processes 3. Shifting responsibility to managers 4. Measuring Success with productivity This definition has changed very little in the past decade, as evidenced by the various references cited over the course of the second half of the decade: Trends in Human Capital Management: The Emerging Talent Management Imperative…Knowledge Infusion White Paper, July, 2006 “The process of managing the supply and capabilities of the workforce to meet the demand for talent throughout the organization to achieve optimal business performance and in direct alignment with organizational goals.” The Official ASTD Blog May 8, 2009 “A holistic approach to optimizing human capital, which enables an organization to drive short and long term results by building culture, engagement, capability, and capacity through integrated talent acquisition, development, and deployment processes that are aligned to business goals.” It became clear that a central theme of talent management definitions was a focus on integrated core processes. Talent management was being seen as synonymous with integrating core HR talent processes. New Talent Management Networks (NTMN) annual talent management report cited in HBR Answer Exchange 5/24/2010 “…companies define talent management largely as consisting of succession planning, high potential identification and development, assessment and feedback, and career planning/development.” OMNI LEADERSHIP 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com Page 3
  • 4. A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT BEST PRACTICES WHAT IS TALENT MANAGEMENT? The Impact of Technology The advent of Software as a Service (SaaS) drove an inflection point in the growth of the Talent Management technology market. The market wanted easy and fast access to technology that would help them move toward this exciting concept of integrated Talent Management. Guided by the accepted definition, with its central focus on talent processes, technology vendors developed integrated, automated processes focused on talent acquisition, performance management, development, and succession. The technology vendors focused on automating the core talent management processes that were seen as being at the core of Talent Management. The market philosophy of the technology vendors is illustrated in the graphic below: CORE TALENT PROCESSES: *Performance Mgmt. BUSINESS STRATEGY BUSINESS RESULTS *Hi Po Identification *Development *Succession *Talent Acquisition This model positions automated process at the center of Talent Management sandwiched between bookends of business strategy and business results. The basic message is to align your core talent processes to the talent needs of your business strategy in, order to drive business results. While these solution platforms have contributed substantial efficiency gains through process automation, there is reason to question whether they have also made contributions to increasing talent management effectiveness. OMNI LEADERSHIP 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com Page 4
  • 5. A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT BEST PRACTICES WHAT IS TALENT MANAGEMENT? Moving Toward Effective Talent Management Three additional components need to be added to the historical model to move the model closer to one guiding effective talent management: 1. Talent Measurements – The basics of a Talent System of Record You cannot manage what you cannot measure. In order to improve Talent Management effectiveness, you need to establish a system of record for talent assets that include proven and reliable talent measurements related to successful performance. Sadly, the concentration on process automation has neglected generating the talent measurements needed for effective talent decision-making. The data deficiencies of talent management solutions have been noted by industry analysts: “The big problem with HCM (Human Capital Management) applications is the data. Companies do not have the content or data to understand who their best people are and why” (ThinkEquity 2008 Industry Report). The graphic below suggests the types of talent measurements that are needed to establish a talent system of record that supports effective Talent Management. In order to generate this record, a broad range of fully integrated assessment and evaluation tools are needed in the Talent Management solution. OMNI LEADERSHIP 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com Page 5
  • 6. A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT BEST PRACTICES WHAT IS TALENT MANAGEMENT? Moving Toward Effective Talent Management 2. Analytics – Decision Support Reporting for Managers Once a talent system of record has been generated, it is critical to leverage those measurements through thoughtfully designed analytics that drive and inform the talent decisions made by managers. Effective Talent Management requires going beyond automated processes to presenting line managers with reliable information in a format that supports evidence based decision-making. On demand reporting should help managers answer the four basic talent decisions that need to be made for any pivotal talent pool: Who are my top performers both in terms of results achieved and how those results were achieved Where do I focus individual and group development efforts to maximize ROI Which of my top performers also possess high advancement potential and where should I focus career development efforts Which of the high performing high potentials are ready now for a higher level of responsibility Analytics are used to manipulate and leverage the core measurements needed to answer these questions. 3. Going Beyond Competencies - Competency models are an important component of an integrated talent management solution. They provide a common language used across core talent processes and describe the behaviors associated for success for any given position in the organization. An effective talent management solution should be able to support and drive custom competency models as well as offer rich native competency content for all levels of positions within an organization. An effective competency model would have the following key content components: Competency Label Definition Key Behaviors Performance Standards Interview Questions Development Guides While competencies are an important component of an integrated talent management strategy, success profiles for positions need to be more comprehensive than just competencies. A common language is also needed for defining experience requirements, key traits, motivations, and technical/functional requirements. A common language allows companies to create position profiles which can then be scientifically compared to the talent system of record to quantify the degree of match between a given individual and a specific position. OMNI LEADERSHIP 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com Page 6
  • 7. A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT BEST PRACTICES WHAT IS TALENT MANAGEMENT? Talent Management Redefined John Sullivan’s original suggested key factors for characterizing and defining talent management were accurate but deficient to fully differentiate strategic talent management from traditional HR practices. We have suggested three areas that should be integrated into the original list. We suggest that Talent Management should be redefined in the following manner: 1. An integrated approach within HR based on a common language for defining and profiling success (e.g., competencies, experiences, behavioral predispositions, work preferences, etc.) 2. Integrating people processesinto standard business processes 3. Establishing a talent system of record containing key talent measurements 4. Shifting responsibility to managers and equipping them with comprehensive decision support reporting capabilities to make key talent decisions 5. Measuring Success with productivity These modifications incorporate the three key additions of talent measurements, reporting analytics and rich underlying content needed to complete the components of effective Talent Management. OMNI LEADERSHIP 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com Page 7
  • 8. A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT BEST PRACTICES PERFORMANCE MANAGEMENT – THE CORNERSTONE OF TALENT MANAGEMENT Overview Performance management is often portrayed as the most strategic of core talent management processes. It has captured the attention of C level leaders with the following value promises: Focus all employees on priorities and maximize individual productivity Provide a foundation and process for improving the overall capabilities of organizational talent Align individual efforts with the business unit and organizational goals to maximize efficiency and effectiveness of organizational execution Align rewards and recognition with performance outcomes to ensure retention of key performers However, the question needs to be asked, “How well has performance management delivered on these promises?” Survey data have not been encouraging. Consider the following findings: Performance management is an inconsistently implemented process – A recent study by Mercer found that just one third of survey respondents said they had had a formal performance appraisal in the last year. Performance management has had little impact on performance improvement – The same study by Mercer also found that nearly half of those that had received a formal performance appraisal indicated that it did not help them identify actions they could take to improve. There is little alignment with organizational goals – A recent Performance Management Practices Survey Report published by Development Dimensions International found that “Aligning performance management to support organizational goals and to integrate with other systems proved to be the least common quality of performance management systems”. Aligning pay with performance has been only marginallysuccessful – A recent survey of American Compensation Association members found that the majority of members felt that merit pay plans tying pay to performance were only marginally successful. Does Performance Management Deliver Value in Best of Class Organizations?If the value realized from performance management has been modest for most organizations, one might wonder if there is greater value for best of class organizations. These data are much more encouraging: Organizations exercising world-class enterprise performance management, including widespread dispersal of the tools, enjoy 2.4 times the three-year equity market returns of typical companies in their industry (BusinessWeek Research Services 2008) Organizations in which employees are measurement-managed were identified as being in the top one-third of their industry. Performance measurement was the single most important measurement area that separates successful firms from less successful firms (Towers Perrin 2002) OMNI LEADERSHIP 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com Page 8
  • 9. A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT BEST PRACTICES PERFORMANCE MANAGEMENT – THE CORNERSTONE OF TALENT MANAGEMENT Best Practices - The Keys to Delivering Value If performance management delivers value in best of class organizations, what are they doing differently than most organizations? Various authors and research studies have attempted to identify what are the key drivers in delivering real value from performance management processes. A summary of key findings are offered below: Avoid making it too complicated – Many organizations make the mistake of creating too many goals and gathering too many metrics in their performance management process. The result is tremendous time investment and employee confusion. BusinessWeek Research Services (2008) found that “Determining the appropriate number of goals and types of metrics was considered the number one performance management success factor.” Provide a supportive culture – Performance management has to be supported by senior executives. They need to foster a supportive culture in order to realize real value. The same study from BusinessWeek Research Services (2008) found that “The biggest obstacles to widespread execution of performance management are “lack of accountability” and “a culture that does not support measurement.” Make it widespread and consistent – Performance management needs to be an enterprise wide practice in order to realize full value. This was a finding supported by BusinessWeek Research Services (2008). This study indicated that, “The biggest return comes from extending performance management to front line workers”. Typically, technology is needed to provide widespread access and use. However, remember rule #1 to keep it simple. Lots of bells and whistles not only results in difficult and costly implementations, the added complexity also results in line managers and front line workers rejecting the technology. Don’t forget foundation skills – Performance management in more than standardizes processes and measurements. Real value is dependent on the interactions between employees and managers. In an international cross study of performance management practices published in SASCOM magazine (4th qtr. 2006), the authors concluded “Overall the research shows that successful performance management efforts combine the measurement process with appropriate infrastructure, skills, and culture.” Managers need to have basic skills to manage performance effectively. These skills include: o Setting Performance Goals o Monitoring Performance o Providing Performance Feedback o Conducting Performance Reviews o Conducting a Developmental Planning Meeting OMNI LEADERSHIP 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com Page 9
  • 10. A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT BEST PRACTICES PERFORMANCE MANAGEMENT – THE CORNERSTONE OF TALENT MANAGEMENT Best Practices - The Keys to Delivering Value (cont.) Align individual performance goals with organizational goals – Linking the goals of an individual with the broader goals of a business unit or an organization is called cascading. In order to optimize strategic value, performance management processes should help ensure that the efforts of all employees are in alignment with the goals of the organization. Aligning performance management to support organizational goals and to integrate with other systems proved to be the most critical differentiator in system effectiveness (DDI - Performance Management Practices Survey Report). Focus on both the “what’s” and the “how’s” of performance – Job performance is not one-dimensional. Focusing only on what was accomplished ignores the importance of how the results were achieved. Adding goals for competencies that are needed to support results in the plan ensures both aspects of performance are considered. Performance against competency goals can be reliably tracked using multi-rater or 360 data. These data along with appropriate development content and support processes also help drive individual development planning. In spite of the value received from including competencies, the DDI Performance Management Practices Survey Report found only 38% of organizations followed this practice. Make it a process not an event – In most organizations, the Performance Review is typically treated as a single event, looking backwards rather than forward. Making it an ongoing process requires anticipating problems and focusing on the present or future. This means that managers need to have frequent ongoing discussions throughout the year planning and communicating with employees to improve current and future performance. Focus on development and improvement, keep pay discussions separate - Rensis Likert offered this critique of the performance review discussion in the July 1959 issue of the Harvard Business Review, “The aim of reviewing the subordinate's performance is to increase his effectiveness, not to punish him. But apart from those few employees who receive the highest possible ratings, performance review interviews, as a rule, are seriously deflating to the employee's sense of worth ... not only is the conventional performance review failing to make a positive contribution, but in many executives' opinions it can do irreparable harm.” Samuel Culbert, a professor of management at UCLA and Lawrence Rout, a senior editor at the Wall Street Journal concur in their book, "Get Rid of the Performance Review!," These authors contend that the typical performance review discussion derails due to differences in the mindsets of the two participating parties. The employee is concerned about the impact of the review on his/her pay. This leads to the employee focusing on defending mistakes, justifying actions, promoting their accomplishments, and challenging the manager’s evaluations. At the same time the manager is trying to engage the employee in a discussion of how performance could be improved. The net result is that both parties feel frustrated by the discussion. The purpose of performance review discussions should be on development and improvement. Discussions about pay should occur separately and recognize that pay decisions are only partially informed by performance. Organizational performance, the employee’s position within their pay range, and external supply and demand factors also contribute significantly to pay decisions. OMNI LEADERSHIP 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com Page 10
  • 11. A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT BEST PRACTICES PERFORMANCE MANAGEMENT – THE CORNERSTONE OF TALENT MANAGEMENT Summary Conclusions: It appears that performance management practice does not deliver on the promise of real value for most organizations. Best in class organizations are realizing real value and it is the direct result of applying best practices. In these organizations, senior leaders consider performance management a key aspect of the organization’s culture and drive enterprise-wide usage. They provide visibility to organizational goals and ensure that employee goals are linked to broader business goals to accomplish focus and alignment of efforts. Wide spread and consistent practices are enabled by practical, simple, and easy to use technology. In addition to simplicity in technology, there is discipline in only focusing on those goals and metrics that truly matter to keep administrative overhead to a minimum. In addition to infrastructure, measurements, and processes, there is recognition that managers need training in specific performance management skills. Effective organizations provide ready access to core training and just in time refresher skill training. There is a balanced approach to managing performance. Result goals are important but competency performance is also considered a necessary component of the process. Competency development is supported by multi-rater or 360 surveys, formal developmental planning, and ready access to developmental content, processes, and forms. Following these best practices should allow all organizations to realize the value promise of performance management. OMNI LEADERSHIP 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com Page 11
  • 12. A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT BEST PRACTICES IDENTIFYING HIGH POTENTIALS – PREPARING FOR THE FUTURE Overview According to a recent Wall Street Journal article, just 68% of companies formally identify high potentials and only 28% of companies tell the employees they have been identified as high potential individuals. It is hard to believe that if the individual is unaware they have been labeled as such, that they are receiving any differential investment in their development. The data was based on a survey by Towers Watson of 316 organizations in North America. I am willing to bet these organizations were larger organizations and the true percentage of companies with high potential programs is actually lower. There are two reasons why more organizations do not have high potential programs: 1. Advancement Potential is a difficult construct to measure accurately 2. Developing high potentials requires structured processes and considerable resource and focus Measuring advancement potential in many organizations is just a popularity contest, a highly subjective opinion that is proven wrong too often when high potential individuals fail to succeed when they advance. High potential programs with high failure rates can be demoralizing rather than positive and some organizations shy away from forming a program for this reason. While high potential programs do require structured process, resource, and focus, can organizations really afford not to implement such programs? In a recent global survey of 80 companies, 69% of companies say they are "somewhat" or "significantly" challenged to develop the leadership talent required to compete in emerging markets (Corporate University Exchange, Leadership 2012 Survey). The future demands that leaders be ready with the skills and knowledge to compete. Developing high potential individuals is the key to building the necessary bench strength. The Mystery of Potential - Common Approaches and Problems in Measuring Potential High Potential is defined as having a high likelihood of advancing one or more levels in the organization. It is a predictive measure of being able to successfully navigate transitions across leadership levels. While the definition of potential may be relatively well understood, an accurate measurement of potential is not. Potential is not always readily apparent. It is a quality that lies within the individual, much like DNA. What are the component parts of potential? This is the mystery of potential. Once we can unlock the DNA of potential and identify the component parts, we can then decide on appropriate measurement strategies. OMNI LEADERSHIP 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com Page 12
  • 13. A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT BEST PRACTICES IDENTIFYING HIGH POTENTIALS – PREPARING FOR THE FUTURE The Mystery of Potential - Common Approaches and Problems in Measuring Potential (cont.) Organizations repeatedly see individuals identified as high potential stagnate, struggle, or fail in successfully making upward transitions. This suggests that significant problems exist with how potential is measured today and how high potential individuals are identified. Companies clearly recognize that these problems exist. In a recent global survey of 73 companies, 91% of companies said they were challenged to identify high potential individuals early in their careers (Corporate University Exchange, Leadership 2012 Survey). There are three primary approaches used today to measure potential. Each approach and its associated problems will be briefly discussed. 1. Performance - The most common practice is to use performance in the current role as an indicator of future potential. The implicit assumption is that high performers also are high potentials. Fully 86% of all organizations, and 95% of larger ones, look at the past performance record of workers (May 2009 i4cp survey results).There are a number of problems with this approach. The most obvious is that the competencies and challenges faced in higher level positions are markedly different than competencies and challenges faced in lower level roles. There is little overlap in the requirements for success so there is little reason to believe that current performance in lower roles would be indicative of success in higher roles. It is not surprising that a survey conducted by the Corporate Leadership Council found that only “29% of high performers turned out to be high potentials”. However, performance is a readily available measure and in the absence of a conceptual model of potential, performance serves as a convenient but flawed measure of potential. While performance does not equal potential, it should play a contributing role in the identification of high potential individuals. It is a threshold condition. It is unlikely that an individual will be seen as having high potential for advancement if they are not successful in their current role. 2. Manager Nominations Using Structured Judgment Frameworks – Another common approach is to ask the manager to make an informed judgment of potential considering a defined set of standard elements. This approach has the advantage of considering qualities other than performance and utilizes an implicit model of potential. In 2006, Fast Company polled 20 key leaders in 16 companies to identify the most frequently used elements in judging high potential. The following elements were identified: Ability to Execute: Have they performed well in varied assignments and stretch assignments? Do they excel in ambiguous situations? OMNI LEADERSHIP 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com Page 13
  • 14. A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT BEST PRACTICES IDENTIFYING HIGH POTENTIALS – PREPARING FOR THE FUTURE The Mystery of Potential - Common Approaches and Problems in Measuring Potential (cont.) Relationship Building /Influence/Communication Skills: Can they build a strong case to influence their peers to their position/view? What do others think of them? What kind of impression do they make when I interact with them? Passion and Ambition: Do they have a sense of urgency around taking on challenging and important projects? Passion for Learning: Do they have an openness to and passion for learning? Are they highly motivated to continuously learn? While these elements are “future oriented”, there is still concern about the extent that current performance influences these judgments. There is also considerable concern about the potential for bias in using judgments from a single rater (manager). 3. Higher Level Competency Models – Some companies recognize that the competency requirements for high level leadership roles differ from the competencies required in lower level roles and also recognize that a single rater approach invites personal bias. Therefore, they assess lower level leaders using competency models for higher level roles. Most commonly, this assessment is conducted through the use of a 360 or multi- rater survey. This approach is positive in that it is both future oriented and overcomes the reliability problems of measures from a single rater. However, there is a significant problem in the opportunity for observation. Multi-rater surveys assume that the raters have had sufficient opportunity to observe the core behaviors that define a given competency. This condition is not met in cases when raters are asked to rate behaviors that are not present or required in the current job. For example, it is difficult to obtain a reliable measure of “Developing Organizational Strategies” if an individual has no opportunity to perform the behaviors associated with the competency. When there is no demonstrated behavior to base a judgment, one has to rely on inference. In this case, one would have to infer future competence based on the individual’s understanding and analysis of the strategies developed by current senior leadership. However this inference may well be flawed since understanding strategies is demonstrated by different behaviors than those required for actually developing effective organizational strategies. OMNI LEADERSHIP 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com Page 14
  • 15. A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT BEST PRACTICES IDENTIFYING HIGH POTENTIALS – PREPARING FOR THE FUTURE A Conceptual Model of Potential and Best Practices for Measurement The following conceptual model is proposed for both understanding the components of potential and suggesting a measurement strategy. The elements of the model will be discussed and a supporting rationale for each component will be presented. The first component of the model focuses on the hard-wired aspects of potential, what we refer to as “raw potential”. There are two core elements of raw potential: Behavioral Predispositions – Not everyone is naturally predisposed to assume leadership roles. There are certain core traits or characteristics that are associated with leadership advancement and success. Best Practice: Personality constructs with proven validity in predicting leadership success should be used as measures of this core element. Particularly useful are proven personality instruments that provide an “overall leadership predisposition scale”. OMNI LEADERSHIP 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com Page 15
  • 16. A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT BEST PRACTICES IDENTIFYING HIGH POTENTIALS – PREPARING FOR THE FUTURE A Conceptual Model of Potential and Best Practices for Measurement (cont.) Cognitive Ability – There is increasing complexity in the challenges associated with higher level leadership roles. Individuals need superior mental abilities in order to understand and handle these complex problems, issues, and opportunities. Research shows that cognitive ability is the single best predictor of leadership success. However, not all cognitive abilities are necessarily valid predictors. Verbal reasoning does not emerge as a strong a predictor as numerical and abstract reasoning. Best Practice: Validated cognitive ability testing provides the best measure of this component of raw potential. The second component of the model focuses on the motivations and career ambitions of the individual. It reflects the extent that an individual is motivated to apply energy and effort to develop their raw potential. Best Practice: Self-report measures can be used to gather key information on motivations and preferences. Some key motivations include: Interest in Advancement – A key consideration for identifying an individual as a high potential is their level of interest in advancement. The opportunities and challenges of senior leadership are not attractive to all individuals. They may prefer a career path that allows them to grow their technical expertise or broaden their scope of responsibilities within their current level of leadership. Achievement Orientation – Grooming oneself for senior leadership roles is hard work and often stressful. Individuals need to have a strong achievement drive to prepare for future roles while remaining high performers at their current level. The third component focuses on the amount of relevant experience an individual has acquired at a given point in their career. Leveraging experience is the primary method for leaders to transform their raw potential and realize their true potential. This element is highly amenable to development and targeted assignments or experiences can improve an individual’s advancement potential. Research has shown that there are specific experiences that are associated with leadership development and success. These specific experiences can be categorized into four higher level factors: Managing a Business - Experience in managing core processes and activities related to the success of a business. Managing Relationships - Experience in managing interpersonal or business relationships. OMNI LEADERSHIP 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com Page 16
  • 17. A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT BEST PRACTICES IDENTIFYING HIGH POTENTIALS – PREPARING FOR THE FUTURE A Conceptual Model of Potential and Best Practices for Measurement (cont.) Overcoming Challenge/Hardship – Experience in handling adversity, challenges, and problems. Managing Development – Experience in broadening one’s global business perspective and developing individual and group capabilities. Best Practice: Leadership experience is best measured using a research based inventory instrument. The fourth and final element is demonstrated behavior. While there are significant differences in the competency requirements for different levels of leadership, there is also some overlap. There are core competencies that serve leaders at all levels and should be examined when considering potential. Examples of these areas include: Interpersonal influence Communication skills Adaptability Emotional control Integrity Best Practice: A multi-rater survey provides an economical and reliable measure of demonstrated behavior in core competency areas. Standardized tools with appropriate norms provide the basis for integrating the overall personality data, cognitive ability data, and experience data. These data can be combined into a single norm based percentile standing. The recipe mix for integrating these data is an important consideration to mitigate possible adverse impact effects while retaining predicting power. OMNI LEADERSHIP 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com Page 17
  • 18. A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT BEST PRACTICES INDIVIDUAL AND GROUP DEVELOPMENT Overview of 360 Surveys for Developmental Planning The underlying assumption behind developmental 360 feedback systems is that an individual’s self -awareness and perceived need for change will be enhanced by a systematic process of introspection and the review and comparison of ratings from others (Church & Bracken, 1997). However, traditional multi-rater approaches have shown a low level of agreement between self and “Other’s” ratings. Self- ratings are typically higher than “Other’s” ratings by as much as one half a standard deviation (Harris & Schaubroeck, 1988). This presents a challenging feedback situation where there is little agreement between self- perceptions and other’s perceptions and other’s ratings are generally much lower. Individuals may discount the ratings of other’s or become defensive and de-motivated by the lower rating values. Clearly, self-awareness is a key ingredient for performance improvement. The degree to which a discrepancy exists between an individual’s self- rating and the average rating made by “Other’s” in a 360 process has been conceptualized as an indication of the amount of self-awareness possessed by the individual. Small differences are an indication of high self-awareness while large differences would be seen as indicative of low self-awareness. In addition to self-awareness, other factors have also been shown to have a systematic effect on differences between self and “Other’s” ratings. The degree of direct contact between raters and the target individual can contribute to rating differences (Pollack & Pollack, 1996). The nature of the competency being rated can also contribute to differences between self and other’s ratings. Lower levels of agreement are associated with ambiguous (difficult to observe) competencies, higher levels of agreement are associated with more concrete (observable) competencies (Dai, Stiles, Hallenbeck, & DeMeuse, 2007). High levels of self – others agreement have been associated with a number of positive outcomes relevant for human resource practitioners. Some of these positive outcomes include perceived need for change (London & Smither, 1995), performance improvement after feedback (Atwater & Yazmmarino, 1992; Atwater et al., 2005; Johnson & Ferstl, 1999) and leadership effectiveness (Atwater, Rouch, & Fischthal, 1995). While self-ratings are typically viewed as unreliable and excluded in the calculation of competency performance in 360 feedback reports, there is evidence that self-ratings can be reliable and valid measures in certain circumstances. In a study conducted by the US Army Research Institute, self- ratings were found to have a stronger correlation with leadership ability than either peer or superior ratings (Psotka, Legree, & Gray, 2007). It was hypothesized that a structured process consisting of regular superior reviews facilitated an accurate introspection and was responsible for the strength of the correlation. OMNI LEADERSHIP 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com Page 18
  • 19. A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT BEST PRACTICES INDIVIDUAL AND GROUP DEVELOPMENT An Alternative Approach Is a lack of self-awareness responsible for low self-other agreement? It could easily be argued that the degree to which a discrepancy exists between an individual’s self- rating and the average rating made by “Others” in a 360 process should be an indication of the amount of self- awareness possessed by the individual. Small differences would be an indication of high self- awareness while large differences would be seen as indicative of low self-awareness. I suspect it is not because individuals have such little self-awareness. It probably has more to do with the traditional 360 process which creates a scenario which encourages self-promotion. Omni has developed a unique approach to multi-rater surveys that was designed to maximize self-awareness and show higher congruence in self-other’s ratings compared to traditional approaches. In this process, the individual rates their performance in comparison to structured performance standards for each behavior within a competency. The self -ratings are then shared with the other raters along with the performance standards to gather their perceptions of agreement or disagreement. The combination of structured performance standards with a transparent sharing of the ratings to others is felt to drive higher levels of introspection and self- awareness. We recently put this to a test in a research study with one of our client organizations. The results were amazing. There was a highly significant relationship between self-ratings and the ratings by others and no significant differences in their means. In fact, the self-ratings were slightly lower than the ratings of others. It appears the Omni 360 process corrected the past problems with inflated self-ratings and low self-other agreement. Of course, there is always a caution to not overly extrapolate from a single study but these are pretty amazing results. The benefits of this approach are most likely seen in performance feedback sessions and subsequent developmental planning. These sessions will not have the difficult task of overcoming potential defensiveness associated with other’s perceptions being much lower than the individual’s self-perceptions. The higher agreement between self and others should also make it easier for the individual to accept identified development needs as being accurately measured which should increase their willingness to act on the data. Finally, the more thoughtful introspection driven by the Omni process should help predispose the individual to receiving feedback since they have already thought carefully about their true strengths and development needs. OMNI LEADERSHIP 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com Page 19
  • 20. A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT BEST PRACTICES INDIVIDUAL AND GROUP DEVELOPMENT An Alternative Approach (cont.) There are likely to be other benefits to higher self-other agreement including a higher willingness to participate in future 360 surveys. The process should be seen as less threatening by the target individuals. Given the absence of proven research, we need to continue to rely on our common sense in implementing effective multi-rater programs (but we need to challenge our underlying assumptions). A broader list of preconditions for effectiveness likely would include: Acceptance of the data by the participant The relative trainability of the target competencies The quality of developmental planning The level of support and follow up provided Accountability for behavior change Best Practices for Developing Talent There are a number of proven approaches and best practices for developing talent. This list is not exhaustive but contains proven strategies: Stretch Assignments – Experience matters. Experience is the primary way critical leadership skills are developed. However, the current roles of high potentials are not likely to routinely afford the kind of opportunities that are most transformational. The Center for Creative Leadership and others have researched the kinds of experiences that are most important for leadership development. Stretch assignments should be challenging in nature and designed to fill specific experience gaps. Learning by doing - Action Learning involves working with others to analyze an actual work problem and develop an action plan. The action learning team is typically cross functional and diverse in background which provides an opportunity to be exposed to other perspectives and parts of the business. Analyzing, planning, and implementing solutions provides a rich foundation for learning by doing and has immediate practical benefits for the organization. Leaders developing leaders – Mentoring and coaching relationships with more senior leaders are important to developing an appreciation for the realities and demands of higher level jobs. The mentor provides a window into senior roles and passes on important learning and insights that have been acquired from their experience. Professional career coaches may also be assigned to high potential individuals. OMNI LEADERSHIP 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com Page 20
  • 21. A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT BEST PRACTICES INDIVIDUAL AND GROUP DEVELOPMENT Best Practices for Developing Talent (cont.) Feedback – All learning involves some form of feedback but formalized feedback programs can be particularly effective. Feedback is typically focused on competencies that are important for a higher level of leadership and involve some form of assessment. The most powerful form of assessment utilizes behavioral simulations which parallel the actual demands of higher level positions. To maximize learning, feedback is provided immediately after participation in the simulation. More formal feedback is provided later in the form of a written report. This report is used to structure an individual development plan. Another common form of assessment is the use of multi-rater or 360 surveys. In this approach, individuals that surround the individual on a daily basis provide ratings of performance in specific competency areas. Again, the feedback report is used to guide individual development plans. Job Rotations or Shadowing – Job rotations are used to increase exposure to the business as a whole. The individual is systematically moved laterally into temporary assignments in various parts of the business. These assignments may last a year or more and provide an opportunity to acquire new knowledge, learn new skills, and build a broad based network of contacts. Another option is job shadowing where an individual is paired with another person already performing in the role to learn how to perform in that role. Blended Learning – Blended learningcan simply be defined as the use of two or more learning technologies to deliver training (e.g., instructor led training might be blended with online learning). Blended learning techniques are designed to take into account the different learning styles of individuals and to match learning methods with the task or skill to be learned. Developing talent takes more than effective developmental processes. It demands a carefully planned program with administrative controls, evaluation components, and organizational commitment. However, proven developmental strategies are a definite pre-requisite for success. OMNI LEADERSHIP 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com Page 21
  • 22. A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT BEST PRACTICES SUCCESSION PLANNING – DEVELOPING BENCH STRENGTH Overview Upcoming baby boomer retirements coupled with high executive failure rates and ever shrinking and flattening organizations have caused corporate directors, CEO’s, and Senior Human Resource professionals to wonder where successors are going to come from and how ready will they be to assume key roles. There is little confidence in current practice: 16% of corporate directors feel they are effective at succession planning (National Association of Corporate Directors, 2008) 38%of HR leaders rate their succession management practices as effective or very effective (High Impact Succession Management Study, 2009 Center for Creative Leadership) 70% of organizations surveyed plan to modify their succession planning processes (Succession Management Survey 2006, Institute for Corporate Productivity) Why the wide-spread dissatisfaction with succession management? Problem 1: The Basics are Not in Place – Limited Talent Measurements or Relevant Information “Clearly identifying the characteristics (skills, knowledge, personality, etc.) required for successful performance, and then evaluating talent against those characteristics must be at the heart of any talent management system (Survey from the Conference Board 2008 Talent Management Strategies Conference)”. In order to evaluate talent readiness for a key role, you need three core elements: clear and sufficient definition of the requirements for success in the role. reliable and predictive talent measurements relevant to the requirements. a method for comparing or matching role requirements with talent profiles. Too often, organizations naively feel that they “know” their leadership talent and key roles and can make accurate subjective determinations of “fit” and “readiness” of potential successors for key roles. There are limited attempts to bring in objective data beyond personal observations and opinions. These practices have resulted in high failure rates. A Manchester Consulting study found that 40% of newly promoted leaders failed within the first 18 months of being placed in the role. Another global study conducted by Development Dimensions International found that one third of internally sourced leaders fail. OMNI LEADERSHIP 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com Page 22
  • 23. A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT BEST PRACTICES SUCCESSION PLANNING – DEVELOPING BENCH STRENGTH Problem 2: Limited Consideration of the Business Context While the first problem focuses on a lack of talent measurement, this problem focuses on a failure to consider unique situational or work context variables. A CIO position in one company may demand a very different set of executive qualities than a position in another company even though their position descriptions may read very similarly. This is because so much of leadership success depends on the business context surrounding a role. What are the key challenges facing the role? Updating and integrating internal systems? Creating a new product development vision and implementing new product development processes? What is the culture of the company? Is it entrepreneurial? Is it overly conservative? What are the key stakeholders’ and senior executive teams’ characteristics and expectations? Who will fit in and who will not? How is the role evolving? Is what is required today going to fit with the future? Is there a good fit between their motivations and preferences and the realities and opportunities of the future role? For example, if they are highly motivated by entrepreneurial opportunities, are they a good fit for a future role that offers limited entrepreneurial opportunity? What is their interest in advancement, travel, or global assignments? These interests may have significant impact on their “fit” for certain future roles. The Core of Succession Planning – A Best Practice Talent Review Process The information gathered in a talent review process varies across organizations but the purpose of the talent review should be the same: 1. Confirm that the talent is a top performer 2. Assess the level of advancement potential possessed by the individual 3. Ascertain the level of readiness to assume greater responsibility now 4. Plan appropriate development activities Let’s look at the type of information that would be appropriate for accomplishing each purpose. OMNI LEADERSHIP 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com Page 23
  • 24. A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT BEST PRACTICES SUCCESSION PLANNING – DEVELOPING BENCH STRENGTH The Core of Succession Planning – A Best Practice Talent Review Process (cont.) Confirming that the talent is a topperformer – Two pieces of information areimportant. You want to review the performance review history of the individual to determine the level and consistency of results performance against goals. You would also want to review the history of competency performance of the individual. This information may be part of the performance review or obtained from 360 survey assessments. Ideally, the two dimensions of performance would be plotted in a nine block report to confirm that the individual is achieving outstanding results through the demonstration of exemplary behaviors. Evaluating Advancement Potential – Earlier in this article, I put forth a quantitative approach for actually measuring advancement potential. Ideally, subjective evaluations and quantitative measurement would both be gathered and compared to validate the level of advancement potential possessed by the individual at that point in time. Evaluating Readiness to Advance – This judgment requires a definition of the requirements of performance at a higher level of leadership and a systematic comparison of the talent against each requirement to identify matches and non-matches. The talent profile is compared to the requirement profile to determine the degree of “match”. Talent measurements and assessments are a key component of creating a talent profile. The graphic below shows a match analysis for some leadership experiences. The individual’s percentile norm standing is compared to the criticality of each type of experience to determine if further development is needed: OMNI LEADERSHIP 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com Page 24
  • 25. A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT BEST PRACTICES SUCCESSION PLANNING – DEVELOPING BENCH STRENGTH The Core of Succession Planning – A Best Practice Talent Review Process (cont.) Developmental Planning – The comparison of the talent profile to the job requirement profile identifies the gaps that need to be addressed. As has been already discussed, a variety of developmental strategies may be used to prepare the individual for greater responsibility and advancement. Developmental planning should also include a review of any possible derailers that might be present. A derailer is a weakness that, if not addressed or improved, will likely prevent a potential successor from achieving their true potential. Here is a list of some common derailers: Derailing Behaviors 1. Shares confidential information 2. Takes credit for others’ actions 3. Fails to keep promises/commitments 4. Fails to listen or be open to others 5. Plays favorites 6. Intimidates or bullies 7. Loses composure under stress 8. Micro-manages 9. Fails to staff effectively Derailing Characteristics 1. Overly critical or argumentative 2. Overly needy of approval 3. Arrogant or self-promoting 4. Overly reckless or impulsive 5. Risk averse 6. Low tolerance for ambiguity Derailing Deficiencies 1. Lacks accountability/follow through 2. Lacks initiative 3. Lacks focus or priorities 4. Lacks self-awareness 5. Lacks awareness of others In a best practice talent review, it takes very little time or effort to discuss whether the individual displays any derailer tendencies. If there is evidence that one or more may exist, it makes good sense to integrate the issue into the individual’s coaching and development plan. Addressing a tendency early in one’s career can prevent that career from stalling or going into a tail spin later. OMNI LEADERSHIP 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com Page 25
  • 26. A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT BEST PRACTICES DEPLOYING TALENT – PUTTING THE RIGHT PERSON, IN THE RIGHT JOB, AT THE RIGHT TIME Overview Employee selection is a critical component of effective Talent Management. A strong employer brand can be a true competitive differentiator for an organization. Building a strong brand starts with being concerned with the candidate experience during the selection process. The initial experience of the candidate during the selection process is likely to have a major impact on their view of the organization’s culture, their perception of the value being placed on talent, and their perception of the sophistication of the organization’s talent management processes. Effective employee selection involves more than establishing a strong employer brand and attracting and hiring superior talent. The key to effective selection is the ability to match the right person for the right job at the right time. Retention rates, individual productivity, and business competitiveness all hinge on effectively matching individuals to jobs. This white paper provides an overview of common employee selection tools, identifies current trends that are impacting how employees are selected and matched to jobs, and provides recommendations for tool use. A Review of Selection Tools and Best Practices 1) Candidate Pre-screening Tools Candidate pre-screening refers to the initial evaluation of candidate qualifications at time of application. The purpose is to reduce a potentially large candidate pool to a more manageable number of candidates. While there is certainly a focus on efficiency in pre- screening candidates, there is also a concern about accuracy. You do not want to advance the wrong candidates or reject high quality candidates in the process. Three of the more common approaches to candidate pre-screening include: a) Resume Matching Technology – There are a number of technologies that have been developed to search resume content for key constructs, phrases, or words that are relevant for a given position. They provide a tremendous efficiency advantage over manual resume reviews. Unfortunately, they are not necessarily accurate. OMNI LEADERSHIP 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com Page 26
  • 27. A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT BEST PRACTICES DEPLOYING TALENT – PUTTING THE RIGHT PERSON, IN THE RIGHT JOB, AT THE RIGHT TIME A Review of Selection Tools and Best Practices 1) Candidate Pre-screening Tools Part of the problem is in the resume itself. According to research conducted by The Society of Human Resource Managers, over 53% of individuals lie about their resume in some way. Forbes Magazine has a list of the top lies people put on their resumes. Some of the more common ones include: 1. Lying about your degree 2. Playing with dates 3. Exaggerating numbers 4. Increasing previous salary 5. Inflating titles Another problem is candidates have learned to “seed” their resume with key words and phrases that are likely to result in a false match with a particular resume search. Even when the resume is totally factual, it provides little information for truly differentiating individuals against the full range of job requirements for a position. b) Profile Matching Technology - The concept of matching people to opportunities based on profiles is very familiar to most people today with the proliferation of dating services that rely on this approach. The approach is quite straightforward. The talent creates a profile of core attributes relevant for their consideration as a candidate (e.g., industry experience, management experience, salary preferences, etc.) and the profile is matched to the position requirements provided by an employer. While conceptually sound in theory, in practice there are problems. Most candidates are not willing to complete a lengthy profiling process as a pre-screen. Lengthy profiles would result in a high rate of abandonment. Therefore, the candidate match is only based on a relatively small number of job requirements and many unqualified candidates are incorrectly identified as a good fit. In order to obtain a complete and useful requirement profile of a position for accurate matching, it is important to consider a number of characteristics. These characteristics could include: OMNI LEADERSHIP 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com Page 27
  • 28. A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT BEST PRACTICES DEPLOYING TALENT – PUTTING THE RIGHT PERSON, IN THE RIGHT JOB, AT THE RIGHT TIME A Review of Selection Tools and Best Practices Candidate Pre-screening Tools Background requirements – e.g., desired industry/functional experience, management experience, certifications, education Contextual requirements – e.g., compensation, travel, specific role challenges, and organizational culture demands Personality requirements – e.g., key characteristics and predispositions that would facilitate meeting the demands of the positions Experience requirements – e.g., critical experiences necessary to prepare an individual to be successful in the position Competency requirements – e.g., behavioral skills associated with successful performance in the position Unique requirements – any special or unique requirements associated with the position It is for this reason job/talent matching is more appropriately applied later in the selection process when the candidate is more motivated to provide a complete profile. c) Scored Application Forms- The application form is also a traditional source for evaluating candidate potential. There is typically a lot of overlap in information provided by a resume and information requested on an application form. The primary difference is the application form is a structured process that solicits the same information from all candidates. It overcomes the problem of difference in resume content and formats. It also allows the addition of specific questions regarding qualifications, preferences, and experiences that are important to the employer. Application items can be assigned a particular weight and value for different responses. Automated routines can be used to score application forms thereby eliminating the subjectivity of manual reviews and also addressing the criterion of efficiency. They need not be overly long and still provide relevant information concerning the full range of requirements. Scored application blanks have also been shown to be reasonably accurate (Reilly and Chao, 1982; and Schmitt, Noe, & Kirsch, 1984) OMNI LEADERSHIP 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com Page 28
  • 29. A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT BEST PRACTICES DEPLOYING TALENT – PUTTING THE RIGHT PERSON, IN THE RIGHT JOB, AT THE RIGHT TIME A Review of Selection Tools and Best Practices 1) Candidate Pre-screening Tools (cont.) d) Custom Screening Questionnaires – Custom screening questionnaires are similar to application forms but are designed specifically for a particular job. Structured questions that relate to the specific requirements of the job are created. These questionnaires are most commonly presented online and scored in real time. Differential weights are applied to candidate responses to create a weighted score. Knock out factors on mandatory requirements are included. Resume data are also captured and can be potentially scored. Current Trends and Best Practices for Candidate Pre-Screening Technology providers are increasingly integrating screening questionnaires and resume review processes into selection workflow capabilities. The trend is to move beyond simple efficiencies in selection to being concerned with quality of hire.Custom screening questionnaires are recommended as the preferred method for candidate pre-screening. They are highly efficient, provide a structured approach for reviewing candidates, and are able to collect the job specific information necessary for making an accurate screening decision. One would review the resumes of screened-in candidates before making a progression decision. Profile matching technology is recommended as an important component of the selection process which would be used later when candidates are willing to provide a complete talent profile. 2) Pre-Employment Tests Pre-employment tests are quite prevalent today. According to a recent survey roughly 86% of companies are using some form of pre-employment testing. While there are a large number of different types of tests available, the two most common are: a. Ability Tests– While there are a large number of different kinds of ability tests, the most common type of ability test is a measure of cognitive or mental ability. There is abundant evidence that this type of test is a strong predictor of overall performance across a wide range of jobs. In an often cited paper, Schmidt & Hunter (2004) provide evidence that general mental ability “predicts both occupational level attained and performance within one’s chosen occupation and does so better than any other ability, trait, or disposition and better than job experience” (p. 162). There are three common types of mental ability tests. OMNI LEADERSHIP 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com Page 29
  • 30. A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT BEST PRACTICES DEPLOYING TALENT – PUTTING THE RIGHT PERSON, IN THE RIGHT JOB, AT THE RIGHT TIME A Review of Selection Tools and Best Practices i. Verbal Reasoning – Verbal Reasoning is the ability to understand and reason using concepts framed in language. Critical thinking skills are commonly measured with these tests. ii. Numerical Reasoning- Numerical reasoning is the ability to use numbers to develop, comprehend, and communicate ideas. Basic math skills are essential to having good numerical reasoning skills. iii. Abstract Reasoning - Abstract Reasoning is the ability to recognize abstract patterns, associations, or relationships without using words or numbers. Different from both Verbal and Numerical Reasoning, Abstract Reasoning is right-brain dominated. It is a measure of an individual’s ability to perceive and think clearly, make meaning out of confusion, and formulate new concepts when faced with novel information. The main drawback to mental ability testing is evidence of adverse impact on minority populations. Diversity goals are negatively affected by this type of testing. Therefore, it is common practice to combine such tests with other tests or selection procedures to dilute their adverse impact. b. Personality Tests-Although personality tests measure a variety of specific constructs, these constructs typically collapse to five basic factors of personality. These factors, commonly called “the big five”, include: (1) openness to experience, (2) extroversion, (3) agreeableness, (4) conscientiousness, and (5) emotional stability. There is growing evidence of the usefulness of these factors in predicting job performance (Barrick, M.R. & Mount, M.K., 1991). When using personality tests, it is important to use those that were specifically developed for selection rather than for general research on individual differences. It is equally important to review the validity evidence for any selected instrument. Additionally, there are concerns that candidates may be successful in faking personality instruments. It is therefore important to select an instrument that contains a well-designed “faking” scale as a key construct. The lack of adverse impact and the consistent evidence of validity have made personality testing a frequent component of selection procedures. OMNI LEADERSHIP 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com Page 30
  • 31. A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT BEST PRACTICES DEPLOYING TALENT – PUTTING THE RIGHT PERSON, IN THE RIGHT JOB, AT THE RIGHT TIME A Review of Selection Tools and Best Practices Current Trends and Best Practices for Candidate Pre-Screening There is increasing support for a different type of norm based test called an Experience Inventory. Everyone intuitively knows that experience matters when considering the qualifications of a candidate…but which experiences? Extensive research on the types of experiences that lead to leadership success has surfaced specific themes. Items have been created for these themes which has led to the construction of norm based experience inventories. These inventories are showing early promise as a new type of valid predictor. There is also a trend toward non-proctored web-based testing to provide greater convenience for the test taker. A recommended approach is to combine personality testing, experience inventories, and mental ability testing to optimize the amount of predictive information that is gathered while minimizing the adverse impact of the mental ability test. It is also recommended to use numerical reasoning and abstract reasoning rather than verbal reasoning tests to further lessen adverse impact. Short forms of tests should be used when available to reduce the time required for test completion. Generally, testing should usually be positioned later in the selection process with candidates that have passed earlier hurdles and are motivated to complete the testing process. Test results should be used in matching talent profiles to job requirements. 3) Interviews Interviews are the most ubiquitous selection tool in use today. They are also the selection method with the poorest execution. Many interviews are more of a “personal chemistry” check than a reliable and accurate evaluation of qualifications. Interview practices can be sorted into two basic categories: a. Structured Behavioral Interviews -There is a considerable body of research that supports the power of the interview when it is a structured process. When interviews are structured, they have considerable reliability and predictive value and are a powerful selection tool. OMNI LEADERSHIP 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com Page 31
  • 32. A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT BEST PRACTICES DEPLOYING TALENT – PUTTING THE RIGHT PERSON, IN THE RIGHT JOB, AT THE RIGHT TIME A Review of Selection Tools and Best Practices Structured interviews: Use competencies as the framework for structuring the interview. Competencies are based on a job analysis which is a systematic review of what it takes to be successful in a particular job. Use pre-planned interview questions that are linked to competency requirements. This ensures that the interview questions are job related. Pre- planned questions also ensure that the same questions are asked of each candidate to ensure consistency and “apple to apple” comparisons. Every candidate has the same opportunity to demonstrate they have the knowledge, skills, and background to perform the job. Use trained interviewers. Interviewers are trained in how to evaluate responses to prepared questions. Training helps take the bias and subjectivity out of the evaluation process and gives interviewers a common frame of reference for evaluating candidates. Ratings are integrated in a common way to arrive at an overall score as well as a profile of strengths and weaknesses. b. Unstructured Interviews- Research suggests that when interviews are unstructured, they are little better than flipping a coin. Unstructured interviews are characterized by: Each interviewer decides where they would like to focus their information gathering. Each interviewer comes up with their own questions Each interviewer uses their own evaluation framework for evaluating responses Each interviewer integrates the interviewee responses in their own way to reach conclusions Current Trends and Best Practices for Interviews Web-based interviewing solutions are now available in the market to help drive consistency, accuracy, and to reduce legal exposure. These interviewing platforms also make it easier to deploy and bring value to competency modeling efforts.Combine online interviewer training with an online interviewing management system to create structured interviews, manage the entire interview process, and equip interviewers with the tools and skills to conduct accurate interviews. OMNI LEADERSHIP 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com Page 32
  • 33. A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT BEST PRACTICES 4) Behavioral Simulations Simulations are designed to mirror important challenges within a particular job. When properly designed, they provide candidates with a realistic view of the skill requirements of the position and provide a forum for the candidate to demonstrate job relevant skills in a high fidelity representation of critical job demands. Current Trends and Best Practices There are an increasing number of web-based simulations. Virtual reality technology is transforming the ability to simulate realistic work challenge and capture realistic candidate responses. However, it will still be some time before technology can replace trained assessors for providing insightful feedback and maximizing developmental impact.Use behavioral simulations at the executive level – The time and costs associated with simulations and trained assessors can be justified at the executive level. The impact of an executive’s performance on the organization argues strongly to take the time to thoroughly review candidate skills and qualifications. MANAGING RETENTION AND TURNOVER The Difference Between Wanted vs. Unwanted Turnover Not all turnover is bad. In fact, turnover rates that are very low could well be damaging to an organization. Very low turnover is likely an indication that poor performance is being tolerated. Every organization has some level of poor performers that are not responsive to coaching, and should be released (or placed in position that is a better fit). There is also likely some level of bad managers that are having even greater negative impact than poor performing individual contributors. It could even be argued that losing an average performer is not bad, if they are replaced with a superior performer. Upgrading the talent in an organization is both a function of internal development and effective external selection. Very low turnover also restricts the amount of new ideas and perspectives that are coming into the organization, which could easily stifle innovation and bring about stagnation. There could also be a situation where the business strategy is not in alignment with the talent currently available in the organization. Individuals with different knowledge, skills, or experiences may be needed from the outside to execute the business strategy. An organization’s retention goal should be to reduce unwanted turnover. Unwanted turnover would include turnover of top performers, key leaders, high potential individuals, and individuals with business strategy critical skills. Unwanted turnover would also include individuals with key client relationships or other contacts, top revenue producers, and innovators or thought leaders. OMNI LEADERSHIP 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com Page 33
  • 34. A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT BEST PRACTICES MANAGING RETENTION AND TURNOVER A Model of Turnover As the economy improves, turnover is likely to become a major concern for organizations. Unwanted turnover represents costs that are greater than simple replacement costs. The costs of losing a good performer are greater than the costs of losing an average performer. The true cost of losing a key seasoned player is hard to estimate. There is the investment in development of the employee, the value of the knowledge and experience gained, and the lost productivity, that also have to be considered to arrive at a true cost figure. However, much turnover (up to 50% or more) occurs within the first six months of employment and, in an early departure scenario, the bulk of the costs are replacement costs. When an organization starts to lose significant numbers of senior employees, it is usually indicative of even more serious organizational problems. However, the factors that influence turnover rates go well beyond organizational problems. Organizational characteristics are only one of the variables that will impact an organization’s turnover rate. To understand the variables that impact turnover, I have provided the following model: Economic Trends Industry Trends Organizational Characteristics Leadership and Culture Job Characteristics Individual Characteristics OMNI LEADERSHIP 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com Page 34
  • 35. A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT BEST PRACTICES MANAGING RETENTION AND TURNOVER A Model of Turnover Economic Trends-In this model, the overall economy sets the stage for alternative employment opportunities. Generally, in a tight economy, there are less alternative opportunities. Employees are less willing to leave their current jobs, even if they are dissatisfied. Industry Trends- Industry trends interact with the general economy. Let’s take the example of the high tech industry. High tech is fueling a significant portion of the general economy. In a high tech economy, there is a premium placed on up-to-date training, which has the impact of heightening job opportunities for recent graduates, but reducing opportunities for workers over 50 years of age. A booming high tech industry also tends to create fewer lower wage jobs, limits new opportunities for these jobs, but also creates a demand for more knowledgeable workers. The opportunities for these workers are huge and makes for a “sellers” market. The net effect is that turnover is very high in this industry, with a resulting heavy reliance on contract workers. Organizational Characteristics- Nested within an industry is the specific organization. Within any industry, there are some organizations that simply do a better job of retaining employees than others. Some of this has little to do with enlightened practices and is simply a product of workforce demographics. All things being equal, a younger workforce will have more job and company changes than an older workforce. Part-time personnel are less stable than full-time personnel, and a workforce with greater average tenure will have less turnover than a workforce with less average tenure. Another key organizational characteristic is company performance. People are less likely to leave a company that they identify with and can take pride in its positive business and community performance. Leadership and Culture are both strong determinants of turnover intentions. Bad managers can cause good employees to leave. Problems or conflicts with the immediate supervisor are one of the most frequently mentioned reasons employees cite for leaving a company in their exit interviews.Company culture is determined by a bunch of things but for discussion, let’s just focus on company attitudes toward skill development and rewards/recognition. Skills - The emphasis an organization places on developing the skills of its employees will have an impact on turnover. Companies with low unwanted turnover rates tend to spend more money and time on skill development than those with high turnover rates. Rewards/Recognition – The philosophy of the company concerning pay will impact turnover. A recent study by Spherion indicated that 69% of employees considered pay to be a key driver of retention. Companies that are willing to pay for top talent generally are more likely to retain that talent. However, rewards don’t have to be monetary in order to have an impact. Positive feedback, formal recognition programs, and challenging and interesting work assignments are all ways to provide rewards and recognition for top talent. OMNI LEADERSHIP 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com Page 35
  • 36. A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT BEST PRACTICES MANAGING RETENTION AND TURNOVER A Model of Turnover Job Characteristics impact job satisfaction which in turn impacts turnover. Research suggests the following job characteristics are impact job satisfaction: Variety – Jobs that offer a greater variety of tasks are associated with higher satisfaction levels Autonomy – Jobs that offer greater freedom and choice in execution (i.e., empowerment) are associated with higher satisfaction levels Identity – Jobs that offer a sense of ownership and personal accountability are associated with higher satisfaction levels Feedback – Jobs that offer intrinsic feedback on quality of performance are associated with higher satisfaction levels, and Significance – Jobs that are perceived as important are associated with higher job satisfaction. Individual Characteristicsare the final determinant of turnover. There are intrinsic individual differences that affect turnover as well as individual situational factors. Risk adverse individuals with higher needs for security are generally less likely to turnover. Individuals with local ties or financial dependencies are generally less likely to turnover. A recent retention study by the University of Minnesota compared individual differences between “leavers” and “stayers” in seven different organizations over a time period of 20 months. Leavers generally had (1) lower perceived costs of a job change, (2) lower organizational commitment or identification with the company, (3) lower job satisfaction, and/or (4) had a negative recent experience or event in the company. Best Practices for Managing Unwanted Turnover While there are many possible strategies to reduce unwanted turnover, I would like to focus on six key areas: Early Interventions Skill Interventions Leadership Interventions Rewards/Recognition Interventions Selection Interventions Job Enrichment OMNI LEADERSHIP 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com Page 36
  • 37. A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT BEST PRACTICES MANAGING RETENTION AND TURNOVER Best Practices for Managing Unwanted Turnover Early interventions – The fact that large numbers of employees turnover in the first six months of employment suggests that this is a critical time for helping people adjust to new roles. Effective on-boarding programs should cover this critical period. A good on-boarding program helps prevent misunderstandings, gradually introduces the employee into the organization, and provides just in time information and training. Most importantly, establish a support system for the new employee. A good practice is to set up a “buddy” system for new employees. A “buddy” is a seasoned employee who volunteers to “look out for the new employee”, making introductions, providing advice, and helping avoid early pitfalls. Skill interventions– Keep employees motivated and committed by enthusiastically offering training and development opportunities. Smart companies know the importance of personal development in employee retention. Top rated companies to work for have several qualities in common. They spend considerable time in training their people, they have low turnover rates, and they have impressive numbers of applicants per job opening. Leadership interventions – Better Bosses mean lower turnover. Establishing performance expectations, providing coaching and positive feedback, and interacting in a fair and considerate manner are all things that good leaders do to help new employees be successful and receive enjoyment from their jobs. To impact turnover, make sure that supervisory promotion and training programs have interpersonal skills as part of their focus. Measure employee perceptions of leadership behaviors and incorporate behavioral expectations into leaders’ performance management expectations. Rewards/recognition interventions – Various kinds of contingent bonus strategies can be used to help with retention. Deferred bonuses are paid out incrementally with a significant back-end payoff for a combination of performance and retention. This type of bonus system can help guarantee service for a finite number of years but doesn’t address long term retention. Performance bonuses can help an employee reach high levels of income providing they can consistently demonstrate superior levels of performance. This type of bonus can be very effective if performance metrics are readily available and additional costs are consistent with the value of superior performance. If you can’t afford to pay more, or offer contingent pay, don’t forget the value of non-monetary or symbolic rewards like time-off, awards, and other recognition programs. OMNI LEADERSHIP 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com Page 37
  • 38. A COMPREHENSIVE REVIEW OF TALENT MANAGEMENT BEST PRACTICES MANAGING RETENTION AND TURNOVER Best Practices for Managing Unwanted Turnover Selection interventions– Perhaps the most powerful weapon against turnover is improved selection. A well-known consulting company documented 21 studies of the impact on turnover of introducing a structured interviewing selection system. Improving interviewing procedures reduced turnover rates on average a whopping 42%. Putting the right person, in the right job, at the right time, is critical to effective talent management and to preventing unwanted turnover. Job enrichment– Increasing the job satisfaction of high turnover jobs can reduce turnover. For individuals who have a need for growth, the following job design strategies are associated with increased job satisfaction: Increase the variety of tasks performed Provide greater ownership and decision-making on how the job is performed and hold the job holder accountable for quality of outputs Add more significant responsibilities Improve the accuracy and quality of feedback on performance OMNI LEADERSHIP 620 Mendelssohn Avenue North Suite 156 Golden Valley, MN 55427 952.426.6100 www.omnilx.com Page 38