From Capitalism to Talentism

One of the big themes of the 2012 World Economic Forum meeting in Davos was job creation. Klaus Schwab, executive chair said: "The success of any national and business model for competitiveness in the future will be less based on capital and much more based on talent. I define this transition as moving from capitalism to talentism.”

Fundamentally, at a corporate level, the challenge for a CEO and their Talent Council colleagues is to identify where talent - which is better than the competitors - is needed for the execution of strategy.

I doubt any CEO would disagree that their particular approach to managing is constructed from their business strategy, influencing which ratios get measured and monitored. You may have the capital and other levers, but without the right quantity and quality of talent, now and in the future, execution is constrained.

To ensure business and talent strategies are tightly fused, start with the outcome in mind. The steps to build a defensible, diverse bench of talent ahead of less prepared competitors are:

Underpin commerciality
Considered efforts to attract, select, retain, engage and develop the right people should be directed at lead-business lines, critical market segments, service value, current key client groups or targeted new clients. This includes developing talent capability for new revenue streams, evolving business-models and cross-silo collaboration or innovation initiatives.

Counter uncertainty
Talent management has to work ahead of the curve.

Develop a range of scenarios to build a picture of how the external environment will affect the organisation, and how the business will respond from a talent perspective. Each scenario should be drawn from the most relevant issues to the company. What emerges is a true talent planning document and not just a head-count budgeting process.

Reduce pipeline risks
The focus should be on critical roles - not only key people. On the list must be those positions that transact or make a significant contribution to core business activities; those that potentially will become core under a future strategy; hard to fill roles or require specialised training; and those with large reporting numbers. Do employee demographics alter plans? Consider unwanted vacancies: would you be able to replace or up-skill and how quickly could a new employee exceed break-even?

Narrow gaps in talent markets
Looking outside the company helps form a view of community and demographic trends that impact supply sources for critical jobs. Closing any gaps may require alternative strategies such as partnerships with the education sector, investment in retraining, rethinking career paths or experience profiles and redesigning position descriptions.

Measure impact
A persistent issue for the talent management function is demonstrating a return on investment. Setting meaningful lead and lag human capital metrics provides insight to senior management. What savings or costs are realised in filling skills gaps, resourcing and developing for future needs, mobility and expatriate trends, rewarding high-performers and other strategic talent decisions.

Talent management is not an end in itself. It is not a one-time event or a range of tactics. It is forward looking and pro-active with a clear mission on enabling strategic business objectives. It requires executive acumen in developing talent excellence at all levels. Success in building a diverse and sustainable talent pipeline is a competitive differentiator.

Dianne Jacobs is founding principal of boutique talent capital consulting and executive coaching firm, The Talent Advisors, and a former partner at Goldman Sachs JBWere. She tweets on leadership via @talentadvisors.