People often ask HRchitect, why would my company want to invest in a new talent acquisition system or talent management system during debatable economic times and when we have few open requisitions to fill, low turnover and plenty of active candidates?
HRchitect’s response is that leading companies invest in strategic initiatives during both good and bad economic cycles. During challenging economic times, while their competitors are busy freezing budgets and putting projects on hold, industry leaders continue to selectively invest in strategic new systems. During robust times, the need is more apparent. Strategic C-Level executives understand that in order to successfully execute the company’s business plan, they need the right people, in the right positions, at the right time, independent of the current economic environment. Qualified talent must also be available at the right cost. Savvy staffing and human resource executives understand that they are responsible for delivering a continuous supply of qualified talent at the right cost. This future global talent pool will include qualified external candidates, internal candidates (i.e., employees) and a flexible contingent workforce.
In order to be recognized as a strategic member of the executive team, staffing and human resource executives also need to communicate in business terms and analyze their results using strategic metrics. These visionary executives are sponsoring projects to evaluate, select and implement new generation talent acquisition systems and talent management systems as the technology foundation for future success. In addition to traditional metrics like time-to-fill, cost-per-hire and revenue-per employee, metrics are evolving to become more actionable and predictive. The new focus is on quality not on quantity. For example, your sourcing analysis may tell you that most of your new hires for a certain position are coming from staffing agencies. However, after a year on the job, the top performers with the highest performance ratings were almost all employee referrals. This type of actionable information helps recruiters implement the most cost effective sourcing strategy. In addition, identification of your top performers and the screening and interview processes that they went through will help you to refine, as necessary, those processes to help increase your quality hires. Companies are also looking at metrics like new hire turnover, failure rates and employee longevity as strategic measures of quality. Predictive analysis is driven by prior trending results that can be used to reduce risk in making future human capital management expenditures. For example, if turnover of employees with 5 years experience continues as expected, the company will experience succession issues within 3 years.
During a down economy, most companies focus on streamlining business processes and reducing costs. Also, from the employee’s standpoint, this economic environment tends to not only discourage job changes, but also create more pressure to perform. Employees are being asked to deliver more with fewer resources. Many employees, including top performers, will opt to stay in their current jobs until the economy shows a clear sign of recovery. If their employer has not treated them well, they will actively seek new opportunities as soon as the economic expansion is clearly underway. Leading companies invest in new systems that allow them to establish relationships with these passive candidates and build a global talent database. As the economy recovers, these companies will leverage the database to recruit the top talent and gain an advantage over their competitors.
Leading companies also recognize that internal mobility, the movement of employees from one position to another within a corporation, is an efficient and cost-effective method of talent deployment and can be a significant component of a company’s staffing and employee-retention strategy. Making job opportunities available to existing employees (i.e., internal candidates) leads to greater employee satisfaction and retention, while at the same time lowering staffing costs and filling positions more quickly. Retaining your top performers requires more than just posting jobs on the internal career site. New generation talent management systems provide employees with the capability to create electronic profiles that include their skills, competencies and career aspirations. Employees can set up personal search agents and be automatically notified when their “dream job” becomes available.
Talent management systems have evolved to include integrated succession planning and career planning capabilities. Succession planning applications provide the capability to create organizational charts on the fly and get an immediate graphical picture of the company’s strengths and gaps. Analytical reporting capabilities allow management to quickly spot thin areas in the succession chart and identify problem patterns. If one of your senior executives leaves unexpectedly, the software provides the capability to quickly find a successor and also identify the multiple shifts that typically occur at the lower levels when a high-level leadership position is filled from within. Succession planning applications can also be used to quickly identify successors during the merger and acquisition process.
Succession planning has historically been implemented only for high-level executive positions. By deploying career planning software using a self-service approach where employees update their own career plans, companies are involving more high potential employees in the process and implementing career planning at a lower level within the organization. Career planning fosters retention and allows managers to analyze the gap between an employee’s skills, competencies and career aspirations and when they will be ready for promotion.
Performance management applications have also been integrated into talent management systems. The software enables the company to better align departments, teams and individuals with the corporate vision and goals. These new applications provide objective data to better understand why some people are performing and others are under-performing. The performance management application provides opportunities for individuals to improve their performance through feedback, and when integrated with Learning Management System applications, through personalized learning and certification plans.
HRchitect has assisted hundreds of leading companies in the evaluation, selection and implementation of new generation talent acquisition systems and talent management systems.
We believe, whatever the current economic cycle, but especially during times of economic growth, that there will be a major shifting of talent. Leading companies that have implemented new generation talent acquisition systems and talent management systems will leverage the relationships they have fostered with the best candidates to gain a competitive advantage. They will also be in a better position to retain their top talent because they have identified their top performers and put in place career development initiatives to retain them. Having a TAS that meets your companies individual needs and requirements could be your first step toward delivering a continuous supply of qualified talent at the right cost and being recognized as a strategic member of the executive team.
As the leading TAS and TMS consulting firm, we are here to help you evaluate and select the best systems for your organization. It’s a dynamic and puzzling world of HR technology out there and you should never go at it alone.
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Matt Lafata, HRchitect
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Tiffany Appleby