It is time to move beyond saying that talent is an organization’s most important asset. Organizations need to behave in ways that recognize the strategic importance of talent, and to make organization design and strategy decisions based on their ability to attract and manage talent. For decades, CEOs have talked about how people are their most important asset, but they have not behaved accordingly when it comes to developing their business strategies, organization designs, and talent management practices. If organizations are to thrive, it is imperative they make talent management a key part of their business strategy and management decision-making.
How can they do this? First, they need to recognize that the business world has changed. A number of major evolutions, including the globalization of business, advances in technology, and the rapid rate of change in the business environment, have made this happen. These changes have created a world in which an organization’s talent management principles and practices have become the major determinant of its effectiveness.
Positioning talent as the key driver of business effectiveness requires that organizations move away from the traditional job-based approach to organization design and management. They need to begin thinking about this with a focus on the competencies and capabilities that are needed to execute a business strategy. This competency analysis needs to be based on the tasks and activities that an organization needs to execute, rather than the development of job descriptions.
Organizations also need to focus on the potential sources of the talent needed to implement business strategies. This analysis needs to consider multiple types of engagement relationships with talent, as well as whether that talent would be best developed or recruited. The analysis should also consider how that talent can best be organized and managed.
Key to effective strategic talent thinking in today’s world of work is looking beyond the job-based employee model of managing talent. What is particularly exciting and challenging about developing the right talent/business strategy combination for an organization is the number of options available for consideration and implementation given today’s business environment.
Instead of simply looking at jobs and trying to fill them with employees, organizations now have multiple ways of obtaining the key talent they need to do the tasks they require to implement the organization’s strategies. These include using gig talent, contract employees, and partnerships with other organizations that possess the right type of talent and capabilities.
A second key to developing an effective talent and business strategy is making talent availability and talent management drivers of strategy, not just considerations once a strategy is developed. In many cases, this can and should determine an organization’s strategy.
Finally, as discussed in my new book, Reinventing Talent Management, the key talent management principles and practices of organizations need to be designed to fit a talent-driven approach to organizational effectiveness. For many organizations, this will require making significant changes in their talent attraction, selection, development, reward, and appraisal systems.