Building a winning team is all. Managing Talent and Organizational Bench Strength: Are You Game-Ready?

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1 This article appeared in the APR MAY JUN 2012 issue of insiderprofiles ( and appears here with permission from WIS PUBLISHING. Managing Talent and Organizational Bench Strength: Are You Game-Ready? by Oliver Conze, Vice President, Solution Management, SAP and Lillian Reaume, Vice President, Human Resources Center of Excellence, Nakisa Building a winning team is all about bench strength. If you look at the composition of any sports team, you ll see all types of talent: veterans, who think about retirement and post-career; up-andcoming mavericks, focused on excelling and obtaining the next endorsement deal; and rookies, attempting to learn all they can in their first year. As leader of this motley crew, the coach is responsible for keeping the players engaged, building a strong bench, and ensuring every position on the field is filled or ready to be filled with capable talent at any given time, despite injuries or trade deals all in an effort to win the season.

2 91% of employees are willing to change jobs, but 55% of leaders are not expecting it. A multi-generational workforce calls for new approaches to management. Is your organization toeing the line? As any sports fan knows, every season endures a range of highs and lows. And most often, it s not the team with the strongest individual player that wins, but the team with the best bench strength. Building a strong bench can be just as important as creating the starting line-up. Just like sports coaches, today s human resources (HR) departments face similar challenges. So, where does your organization stand in the rankings? Meet Your Newest Team Members: The Millennials We are entering an unprecedented era comprised of a multi-generational workforce, which calls for new approaches to management. Workplace demographics now include three different generations, meaning that fresh-out-of-college recruits will find themselves working alongside colleagues the same age as their grandparents. As 72 million Baby Boomers (born between 1946 and 1964) prepare for retirement, members of Generation X (born between 1965 and 1980) and Generation Y (born between 1981 and 2000) are getting ready to fill their shoes. The impact of these changes will be significant; Generation Y, also known as the Millennials, is the biggest demographic to start work since the Baby Boomers, and is expected to make up 30% of the workforce by So how can HR prepare for the different working styles of a multi-generational workforce? Just like sports coaches, HR professionals are responsible for managing this diverse mix. Inside every organization, the Millennials are demonstrating new ways of working. This technologically savvy generation is mobile, connected, flexible, and fluent in social networking. As social media becomes an integral part of the work world, on the field and off, mobile devices are emerging as the dominant communications and interaction platform, allowing employees to manage almost every aspect of their professional life. There are almost 1 billion people on Facebook, and over 4.6 billion cell phones are in active use. Millennials sometimes refer to their mobile device as their command center and can t imagine a day, much less a week, being disconnected. For some, the work morning s first task is to check Facebook on a smart phone. As these trends (often referred to as business social ) continue to grow, so will their impact on HR. In past generations, loyalty to the enterprise was paramount; the ultimate goal was to attain a job for life. However, newer generations are a different breed that switch jobs on average every two years. 1 Millennials are career-focused with high expectations for their development, and if their employers don t meet their expectations, they won t stick around for long.

3 Fighting the Global War for Talent With the ability for people to easily and readily collaborate and network, and with about 50% of people able to work remotely, it s not a huge surprise to see a decrease in employee retention. In a recent survey, Express Employment Professionals found that 77% of leaders say retention was not a problem or only a slight problem in Yet, according to a recent survey by CareerBuilder, 91% of employees are willing to switch jobs, and 55% of leaders are not expecting it. 3 In fact, according to a recent Employee Performance Survey, 21 million Americans are considering changing jobs in the next year. 4 With the cost of employee turnover estimated at up to 250% of the annual salary per exiting employee, such effects could be detrimental to employee retention and organizational growth. The global war for talent is continuing to be an issue in various regions and industries. While the spike in growth has slowed somewhat in China, Australia, India, and other parts of Southeast Asia, the overall demand for talent everywhere has not. With talent already in short supply, ensuring you can develop and keep what you have and win over the talent you don t have is critical to your organization s success. We have all heard the stories of CEOs of large companies leaving with no replacement. Total chaos ensues. Stock prices drop and shareholders are angry. This scenario is a nightmare for an HR professional. But with the right strategy and tools, you can avoid this scenario and identify which positions are at high risk, define how many people should be ready if and when the need arises, and have clear insight into what talent can fill them. What s Your Game Plan for Stepping Up to the Talent Management Plate? Evidence shows that many organizations are not prepared for succession management. According to Bersin & Associates, 77% of organizations have little or no view of existing talent gaps in their business. 5 This is not surprising, considering that only 35% of organizations do any succession planning at all and of that 35%, planning is only performed for the top 10% of the business. In a 2011 survey by PricewaterhouseCoopers, CEOs rated talent management as the number-one area where they expect dramatic change during the next year. 6 Given this increased attention, it s even more critical that HR executives set aside time to identify where they are and Employees are increasingly willing to switch jobs. What are you doing to keep them? Social media has and will continue to play a role in finding, retaining, and developing talent. Organizations must speak the language of tomorrow s top talent.

4 HR must become a strategic business partner, driving executives to develop a strategy that engages the entire enterprise in an ongoing, flexible talent management process. Effective talent pipeline management begins with effective information management. where they need to be. It s time for HR to step up to the plate. What factors should organizations consider when developing an effective talent pipeline? It starts with understanding how to engage the next generation of talent. As we ve identified, Millennials are digitally aware, hyperconnected, and in control of their careers. They are demanding more input into their advancement, and if they don t receive this, they won t hesitate to switch teams. When developing talent management strategies, organizations must consider these new work styles. So, what should HR organizations do to create an effective talent pipeline? Build bench strength you can count on. Not only should you plan for emerging technologies like social media and mobility, but HR organizations must also ensure an iron-clad strategy for the age-old cliché: have the right people, with the right skills, in the right place (including remote workers), at the right time. To do this, you need the right information. And as we all know, with so much information out there, we can t do it on our own. Choosing technology that caters and adapts to your business processes, not vice versa, is key. We need technology that has effective analytical capabilities built-in so that we can construct the best strategy for our organization. With this technology, we can predict, execute, monitor, and analyze to make the correct decisions for our organization s success. Choose the right tools for a winning succession plan and talent pipeline. Choosing tools that speak the language of the Millennials, while still supporting your Generation Xers and Baby Boomers, will help you retain and nurture talent. Solutions that allow your next-generation talent to interact with the latest technologies, such as motivational games and social networking sites, will enable them to collaborate and work in ways familiar to them. Flexible access to data anytime, anywhere, is also vital to maximize user adoption across all generations. Web-based, real-time solutions, delivered through a single, intuitive user interface and available on multiple devices, prove to be the most successful. Tools that incorporate these modern technologies will make talent easier to detect throughout the organization by creating a unique way for your employees to regularly chart and share their developmental aspirations. This will ultimately lead to higher engagement levels, better perception

5 of the value add of HR services, and increased retention rates. Develop a people-centric approach. It s not just about employing the latest technologies. Organizations must develop a people-centric approach to succession planning in order to secure the commitment of talent. Research shows that Millennials expect regular and transparent feedback on their progress and a clear idea of where they are going and how they will be rewarded. Embedding career planning into the succession planning process will provide valuable information for HR professionals, enabling them to highlight potential multi-generational talent from all areas of the organization. Stay Ahead of the Game: Integrate Succession and Career Planning with an Enterprise-Wide Talent Management Strategy To build a sustainable talent pipeline, succession planning can t be managed as a standalone administrative HR activity, but must be part of an integrated and enterprise-wide talent management program with career planning weaved into the process. By integrating recruiting, compensation, and performance management systems, learning and development programs, and mentorship and recognition programs, future mavericks can be identified and cultivated at all levels of the company, leading to a much more sustainable bench. To stay ahead of the game, HR must continually have its finger on the pulse of business needs and make talent pipeline management part of the company culture. HR departments must concentrate on developing a strategy and a range of tools that provide real-time functionality and engage every member of the enterprise in an ongoing, flexible talent management process. By doing this, organizations can ensure they have the best talent in the best place at the best time. Only then can HR bring it home, earning its seat in the board room by delivering bottom-line benefits and a sustainable, committed bench of players that will keep the organization on top of its game for seasons to come. Oliver Conze (oliver. conze@sap.com) is Vice President of Solution Management at SAP. He leads the team responsible for strategy and Go-to-Market for SAP s global portfolio of talent management solutions, enabling organizations to attract, retain, develop, and better engage top talent. Oliver has been with SAP for over five years in various positions in corporate strategy, portfolio management, and product management. Prior to SAP, Oliver worked for an international management consulting firm. He holds master s degrees in management science from Stanford University and Karlsruhe Institute of Technology, and a PhD in business administration from the University of St. Gallen. Lillian Reaume (lillian. reaume@nakisa.com) is the Vice President of Human Resources COE at Nakisa. Her scope is to provide thought leadership and assist with the development of solutions for Nakisa s global portfolio, enabling organizations in their strategic human resources efforts. Lillian also leads the HR team at Nakisa and has over 17 years of diverse senior leadership experience in the automotive, financial, and high-tech industries. Lillian holds a master s degree in business administration from the University of Windsor and is nearing completion of a PhD in business administration from Capella University. 1 Kaye, B. and Jordan-Evans, S. Love em or lose em, getting good people to stay. San Fransisco: Berrett-Koehler Publishers, Inc. (2008). 2 ;