If your organization is like 83% of the nearly 1,400 that took part in the recent joint i4cp/AMA study on the 2014 critical human capital issues, its ability to effectively manage talent shortages in critical areas needs a great deal of improvement. This massive void presents perhaps the most significant gap with which executive leadership should concern itself, and all signs indicate it's only going to get worse.
We've entered 2014 on the heels of one of the most robust years of growth in market valuation in decades. While the global economy and hiring slowed in January 2014, most experts believe both will improve in the coming months. When this occurs, all organizations need to be prepared for attrition in two key groups: high-performers and those who will soon be eligible to retire. This, coupled with talent shortages in specific disciplines and geographies, has revealed a glaring reality for most organizations: they simply do not have the internal bench strength of talent to achieve or sustain high-market performance.
In its new study, The Top 10 Critical Human Capital Issues: Enabling Sustained Growth through Talent Transparency, i4cp highlights specific issues that organizations need to address to avoid derailment, and provides actionable strategies that will put organizations on the path to sustained success. These reflect the imperatives to develop deep bench strength in critical roles with highly targeted talent segments, to minimize the loss and ensure the proliferation of organizational knowledge, and to ensure consistent, high quality interactions and communications from a broader group of leaders to achieve desired results.
For high-performance organizations to sustain market performance, they must:
Build deeper and broader pools of highly targeted talent.
Only 27% of top companies have competent successors ready to fill executive-level roles and even fewer (18%) are prepared with successor candidates for mission-critical roles that extend beyond the executive level.
Improve leadership development skills with a focus on better interactions and communications.
Thirty-four percent of top companies indicate they are effective at developing leaders, and they are getting worse at it. The influx of Millennials as well as the move to flatter, more matrixed organizational structures dictates the need for improved skills in areas such as coaching and the use of technology tools to collaborate effectively.
Fully understand what supports the organization's strategy and culture and then reward it.
Thirty-four percent of top companies are effective at measuring and rewarding results and only 25% are effective at doing the same with behaviors. The behaviors of executives and middle managers have a very high correlation to market performance.
Contrast this to the continuing struggle among lower-performing organizations, which continue to be paralyzed by inability to execute strategy—in large part the result of three major impediments:
The pervasive lack of alignment (among strategy, goals, supply and demand of workforce talent, etc.).
An abysmal 12% of low-performers indicate they are effective at strategy execution. Not surprisingly, only 8% of these lower-performers are effective at internal communications.
The general lack of organizational agility that results from a combination of insufficient and/or ineffective longer-term planning.
Only 13% of low-performers indicate they are effective at strategic workforce planning, a figure that has not improved over last year.
Leaders who are unwilling or unable to adapt to the changing needs of the workforce and markets they serve.
A mere 11% of low-performers indicate effectiveness in leadership development.
No matter the state of your organization, the following recommendations will help you on your path to high-performance:
Never lose sight of what your organization needs to grow and sustain success in the longer term.
Know what market opportunities your organization plans to capitalize on over the next few years. Then, determine which roles, skills, and competencies are mission-critical to achieve that objective and sustain high-performance. Tight partnership with the business is essential for clarity on where the organization is heading. This will dictate the workforce planning and preparation that needs to work in parallel.
Build strong pipelines of talent that target critical roles, skills, and competencies.
If your organization's definition of bench strength is constrained to the executive suite, you are not looking at your business strategically. Know which roles are mission-critical both now and in the future. These roles vary by business, should include the C-suite, but also extend into areas such as product development, customer service, and project management. Integrate this knowledge into all other talent management initiatives, from recruitment, development, and succession.
Ensure knowledge retention and sharing around those roles, skills, and competencies.
Align programs, processes, and technology to encourage, capture, and utilize the information and insights that proliferate. While knowledge is powerful, what you don't want is for key institutional and experiential knowledge to go unknown or to leave your organization without a purposeful plan to maintain and build on it.
For complete access to the top human capital issues of 2014 and the actions organizations need to take now to achieve and sustain high-performance, download the complimentary report now.