Putting talent at the top of the agenda
Talent management consistently ranks as a top concern for CEOs, yet many say their organisations are missing out on commercial opportunities in the area.
Telecoms giant BT’s got talent, and chief executive Gavin Patterson wants to meet it. Over a two-week period in June, three events were held for the board and operating executive members to meet talent from different levels of the organisation. And that’s not all: the executive committee had a separate meeting to discuss succession planning in the same time frame. It’s safe to say that at BT talent is firmly sitting at the top of the agenda.
“Every single executive and every board member is genuinely interested in what we’re doing in the talent space and wants to play a role to help us coach and develop the talent and move it around the organisation,” says Deborah Lee, chief learning officer at BT.
“Gavin [Patterson] is hugely passionate about the talent agenda and has a view that if people hadn’t given him opportunities and hadn’t stretched him at the right time he wouldn’t be where he is today. He sees his role as doing exactly the same for the talent that exists within his organisation,” she adds.
The BT board aren’t the only leadership team to be putting talent at the top of the agenda: recent research from consultancy firm PwC found that 63% of CEOs are concerned about their ability to find talent with the skills their businesses need.
But are HR functions in big organisations ready to alleviate these concerns? Recent research by Orion Partners suggests many might not be. The report, Ulrich comes of age: What have 18 years of the Ulrich model done for HR?, questioned over 40 large companies that had adopted the Ulrich Model – and found a worrying 83% of them said that their organisations are missing out on commercial opportunities because they don’t have a coherent strategy around talent. A further 30% ranked their employers’ outcomes around talent management as poor, while 53% said they could be improved.
HR's approach to talent
For Angela Williams, HR director UK and Ireland of Sodexo, the outsourcing giant, access to talent is a serious business issue. “It’s the key differentiator for us. Our only assets are our people and the service we deliver. If we don’t have the right talent coming through and a diverse talent pool, we will not grow and succeed,” she argues.
But she admits that while the merits and commercial benefit of HR and talent management practices are recognised at her organisation, this is not a universal truth. “Some organisations still see talent management as ‘let’s fill in a nine-box grid and have a chat’. The proof in the pudding is how many people have actually progressed in the organisation and achieved the most senior roles? A lot of them are just reviewing the same box and having the same conversation each quarter.”
The tried-and-tested, and some might say tired, nine-box grid certainly divides opinion. Robert Bolton, a global lead in the HR Transformation Centre of Excellence at KPMG, says HR leaders need to be looking at new ways of attracting, developing and retaining talent. “The HR function has been guilty of inflicting so-called best practices that don’t have any evidence behind them. The vast majority of them use something like the nine-box grid to sort talent and I think it’s an immensely superficial approach to understanding the stock of talent in an organisation and how you should manage it,” he says.
But for some firms, the nine-box grid is just a conversation starter, says Williams. “The nine-box grid is the first stage of the discussion. It’s a bit like a succession plan: you can fill in all the boxes and say ‘I’ve got a full succession plan’, but actually if you haven’t looked at your measures of success, then it just becomes a paper exercise and doesn’t deliver a succession plan at all.”
Bolton’s main criticism of the nine-box grid is that it encourages a sole focus on high potential employees – and largely neglects the rest of the workforce. This can have dire consequences: more than half of the respondents to a KPMG survey agreed that pursuing high potential talent at the team’s expense puts the business at risk.
Valuing every employee
At online grocers Ocado the top performers aren’t the only employees lavished with attention. “We have a very wide array of talent here at Ocado and that’s not necessarily related to the level of the employee or the role that they’re in,” says HR director Julie Markey. “We want to ensure that we’re always bringing in the best talent at all levels and we then develop those people and look for who’s keen to progress.”
The recruitment process is stringent at Ocado. This means once successful candidates make it through the door, the opportunities for development and promotion are abundant – at every level. For example, there is a development programme where Ocado’s delivery drivers, known as customer service team members (CSTMs), can move up to the role of team manager. “Ninety-four per cent of our Ocado service delivery managers originally joined as CSTMs or drivers,” says Markey.
Growing its own talent is certainly front of mind for Ocado. Some of the most senior members of the management team started in more junior positions: James Matthews, director of non-food, joined initially as a graduate intern in the technology team, while Mark Richardson, who came in as head of technology when Ocado was much smaller, is now operations director.
Danielle Harmer, HR director at Metro Bank, agrees that focusing on every employee, not just the crème de la crème, can reap rewards. “The top 5% matter and they could do amazing things but the other 95% are the ones building our bank, being brilliant with our customers and fixing our IT. We have an ethos that everybody has talent,” she explains.
Instead of using a nine-box grid Metro Bank has designed its own system, which is tailored to the organisation and the types of people it employs. “It’s important to add in the context of the job the individual currently does and the organisation they sit in – that gets missed by the nine-box grid,” believes Harmer.
Identifying your talent's category
Employees are divided into four groups: the hero, those who will stay and grow in their current role; the explorer, who wants to learn a breadth of skills and will likely move sideways; the revolutionary, who will probably be offered a bigger job and the pioneer, who may be carving out a new role or division from scratch.
The latter is largely unique to entrepreneurial organisations, says Harmer. “People who are in the pioneer talent family are doing a new job for the first time, cutting new ground. The challenge for them from a talent perspective is to grow quickly enough to keep up with where the job’s going.”
There is often a temptation for organisations to try to find new roles for talented employees but they should consider stretching them in their current roles instead, she believes: “With talented people it tends to be all about finding them a new job when, potentially, the context of their role and the organisation they’re in might have to develop them really well just to keep up with their job.”
Similar to Ocado, Metro Bank also looks at the number of promotions as a key metric in determining the success of its talent management efforts. From a cohort of new staff employed on 1 April last year, 25% had already been promoted by 31 December. “Success is not very easy to benchmark and organisations report it in different ways, but my head and my heart tell me 25% is very good,” says Harmer.
While such statistics are reassuring to HR leaders, talent management still faces substantial challenges. For breakfast cereal manufacturer Weetabix, international growth opportunities bring their fair share of people challenges.
“Our succession planning for some of the people that we’ve got based internationally is poor,” says Stuart Branch, the company’s group HR director. “It is a risk to the business as our strategy clearly says we want to grow international operations to be a greater proportion of the organisation. We’re finding overseas assignments difficult because we don’t have many people who are interested in working abroad”
Nikki Craig, VP of HR, UK, Ireland and the Nordics at DHL Supply Chain, agrees that international talent management often presents the biggest challenge for businesses. “It’s probably taken us five years to get to a globally-aligned programme,” she says.
Central to this has been the appointment of one of DHL’s most senior HR VPs to lead talent management globally. “We recognise that you need somebody getting out of bed every morning, looking at and thinking about how you can drive talent through the organisation,” Craig adds.
Mind Candy, the tech start-up behind smash-hit kids’ brand Moshi Monsters, has also appointed a senior leader with a sole focus on talent. This is a trend that is likely to continue, predicts Martin Warner, Mind Candy’s director of talent. “When I first entered the HR industry, talent management sat within the wider HR suite. Over the past few years talent itself has become a skill and a profession in its own right,” he says.
“There’s so much specialism to it now you really need to have a dedicated person. Your employee brand depends on it. If you take your eye off the ball because you’ve been caught up in two days’ worth of appraisals or a day of disciplinary hearings, that could be disastrous. It’s an impossible task to ask one person to do everything nowadays. It just can’t be done.”