Organizations must prepare for higher levels of attrition as global economy improves
By Claudine Kapel
If you’re worried about how your organization will address its need for talent in the coming years, you’re not alone.
New research by the Institute for Corporate Productivity (i4cp) suggests many employers “simply do not have the internal bench strength of talent to enable sustained high market performance.”
The i4cp survey had 1,367 respondents, with findings reflecting responses from organizations with 1,000 or more employees.
Organizations need to be prepared for higher levels of attrition as the global economy improves, cautions i4cp. In particular, it suggests organizations are becoming more at risk of losing high performers as well as those eligible to retire.
“Considering that the 2014 survey data shows that only 31 per cent of larger employers plan to increase spend on recruitment and selection this year (down 18 per cent from 2013), most organizations will have to turn the telescope inward.”
But organizations may find that guidance challenging to apply. The i4cp research identified some key gaps in how organizations approach managing talent, even among the high-performing organizations in its sample:
- Only 27 per cent of top companies have competent successors ready to fill executive-level roles. Even fewer (18 per cent) are prepared with successor candidates for mission-critical roles that extend beyond the executive level.
- Only 34 per cent indicate they are effective at developing leaders – and also feel they are getting worse at it. The report suggests the influx of Millennials, as well as the move to flatter, more matrixed organizational structures, are creating the need for better coaching and communication skills.
- Only 34 per cent report being effective at measuring and rewarding results and only 25 per cent feel they are effective at doing the same with behaviours. Yet the report notes the behaviours of executives and middle managers “have a very high correlation to market performance.”
The i4cp report recommends organizations take action in three key areas to strengthen their approach to human capital management, including:
- Develop strong and targeted talent and leadership pools that go broader and deeper within the organization and provide a funnel for the succession planning pipeline.
- Equip those talent and leadership pools with the skills to have more purposeful and productive interactions.
- Establish better ways to measure and reward the behaviors and results required for a change-ready organization.
The call to action emphasizes the importance of communication and transparency.
“Transparency is the common thread that correlates with effectiveness in virtually all human capital processes and programs,” says i4cp.
“Transparency creates structure, consistency, and trust, and it applies to everything from ensuring that employees know where they stand with regard to their work expectations, progress, and development opportunities, to establishing accurate visibility into specific talent pools within the workforce, as well as building and communicating organizational strategy.”
The i4cp survey results, however, found only 36 per cent of the high-performing companies viewed their organizations as effective in managing internal communications. And only 43 per cent felt their organization was effective at communicating the company vision.
There is wisdom in making holistic communications an integral part of your organization’s human capital management strategy.
If you want your organization to truly thrive longer term, it’s not enough to just develop talent and create succession plans. These initiatives will be for not if your talent doesn’t stay with the organization, or if it’s not effectively engaged in delivering key results.
Retention, performance and engagement are all likely to be higher when employees understand not only what’s expected of them, but also what’s in it for them to be contributing members of the organization. Ultimately the cornerstone of any strategy to address talent needs or close skill gaps is to ensure the people who can deliver see your organization as a desirable place to work.