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What is talent management? Strategies for the new world

February 11, 2022 - 17 min read

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What is meant by talent management?

Why is talent management important?

The role of employee experience in talent management

Talent management vs. talent acquisition

What are the key components of talent management?

What is a talent management system?

Developing a talent management strategy

If you want to lead a high-performing workforce, there’s one thing you need to understand. Gone are the days when people could be treated like a “cog in the machine.” 

Today’s workforce is looking for growth opportunities, meaning and purpose in their work, and alignment with their values. That's in addition to fair compensation and flexibility to work around their personal responsibilities. 

They’re also notably looking for work environments free of toxic behaviors and burnout.

Not only have employee expectations changed, the work environment has changed dramatically. Now HR professionals are adapting around new needs and expectations with new tools and new challenges in a hybrid world. For example, how do you make an impression on in-demand candidates without live events and splashy office visits? How do you keep people engaged when your workforce is spread all over the country?

The fact is, people are looking for meaningful work, not just a paycheck. They want to be excited about what they do, have autonomy around how they do it, and thrive as both a person and a professional.  

While these sentiments have been brewing for years, companies are finally acknowledging them. And feeling the impact — employees now have reached a tipping point of being willing to act. When their needs and preferences aren’t met, they’re no longer being shy about moving on to a place that can.

As a result, human resources is about more than hiring and firing or benefits and performance management. 

HR emerged as one of the heroes of the pandemic. With that new prominence, progressive HR leaders have a significant role to play in the talent management revolution. People who are directly responsible for the employee experience have tremendous leverage when it comes to talent management.

But what is talent management, how is it different from workforce strategy, and why is it so important? Read this article for insights on how to develop your organization’s talent management strategies.

What is meant by talent management?

Talent management is about making sure that you have the people that you need, doing the best work that they can do, when and where you need it. It is the infrastructure, processes, and strategies that bring your workforce planning strategy to life. 

To understand talent management, it’s important to take a look at the entire employee lifecycle. This has six phases: attracting, hiring, onboarding, engaging, developing, and exiting.

This understanding of people and talent is inextricable from the employee experience. Done well, it seamlessly integrates areas of people management, human resource management, talent acquisition, and skills development into a broader purpose.

Why is talent management important?

Finding, hiring, and training the right talent takes a lot of effort. Your talent management strategy helps to ensure that your efforts and investment aren’t wasted.

Good talent management ensures that human potential isn’t left undeveloped or underused in the organization.  It helps you set your new hires (and seasoned employees) up for success. 

A strong talent management strategy:

  • Boosts company morale and employee engagement
  • Improves retention and employee satisfaction
  • Helps develop future leaders and career plans
  • Manages performance and helps to close skill gaps
  • Positions current employees for career advancement in new roles
  • Accounts for career development, attrition, and succession planning

Talent management goes hand-in-hand with a whole-person approach in the workplace. While employees fulfill a job description, they’re people first. That means that sometimes they come to work in bad moods, they get sick, they have personal problems, and they have less-than-productive days. You can help them keep their morale, resilience, and performance high by supporting them as people and professionals.

Employee experience is a key — and often understated — part of talent management. Paying attention to each part of the employee experience helps you pinpoint areas for growth and development within your team.

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The role of employee experience in talent management

Talent management, in practice, is more of a philosophy. It’s a strategic approach that doesn’t let employers “off the hook” for employee performance. 

It’s the employee’s responsibility to make sure that they have the necessary prerequisites to apply for the job. But once in the role, it’s important to find a balance between feeling adept at your current role and learning new skills and competencies. Employees generally don’t embrace this “work to learn” approach unless they feel psychologically safe

Research has shown that the employee experience plays a big role. And while what makes a good employee experience is always changing, BetterUp has found that a few factors are critical to retention. People want to work with inclusive, supportive leaders. They want choice in whether to return to the office, and they want to care for their mental and physical well-being. 

In short, they want to be able to bring their whole selves to work. It’s not just good for the employee — it’s great for the organization. People that feel supported are more engaged, more productive, and more likely to stay. It seems obvious, but the results are powerful — and disastrous when overlooked.

Employers that take a hands-off approach to employee experience are missing a huge opportunity. After all, “hard” skills are not the only factor in employee productivity. Belonging, feedback, engagement, and well-being all have a noticeable impact on the bottom line. In fact, a study from BetterUp reported that companies that grew the most in resilience had 60% higher revenue growth than those that grew the least.

Some of these are innate strengths. It’s possible to hire people that are resilient, give excellent feedback, or are highly engaged. But the workplace can — and should — help foster these skills. 

One way is by creating a psychologically safe workplace. That’s one where working on yourself is as important as the work you do in your role. In psychologically safe workplaces, employees feel good about asking questions, taking risks, and even voicing their disagreements

BetterUp measures and supports the development of these skills through the Whole Person Model. The WPM specifically tracks skills that can be improved over time with coaching and support. Helping your employees grow — and stay well while doing so — is a key part of what differentiates talent management from talent acquisition.

talent-management-professionals-at-a-table

Talent management vs. talent acquisition

Talent acquisition is part of the talent management cycle, but it’s more closely related to recruiting. As the name suggests, acquisition is the process of attracting, qualifying, and hiring the best talent for a role.

But once you find the right people, it’s just as important to keep them. Talent acquisition without a strong talent management strategy is like buying a racecar without a driver’s license. Your people won’t have what they need to operate at their top speed. They’ll lack direction and support, and won’t be equipped to take their teams as far as they could go.

What are the key components of talent management?

Strong, comprehensive talent management includes several main components that span all stages of the employee lifecycle. Here’s an in-depth look at the 3 key areas of talent strategy:

Recruiting

The first stage of the employee lifecycle includes attracting talent, qualifying them, the interview process, and onboarding.

The experience with your employer brand starts before they even get their offer letter. While you might be in a rush to get qualified candidates into their roles, this stage of the hiring process is worth the extra time. The recruitment process is a new employee’s first introduction to your organization. Taking time to ensure that they’re well-matched for a role and have what they need to be successful can go a long way towards retention.

Retention

Once people are in their roles, the real work of talent management begins. At this stage, your strategy is split between responsive and proactive management. Responsive tasks might be coaching, performance management, feedback, and career advancement. Proactive tasks include skills development plans, career planning, and Inner Work®.

Performance reviews and regular check-ins are an important part of talent development. No one should feel like they only talk to their manager when something is wrong. Regular feedback can empower both your employees and managers. These touchpoints are both responsive and proactive, helping to manage performance and develop mentoring relationships. 

Offboarding

Not every employee separation has to be a negative experience. People leave jobs for a number of reasons. But if they leave your company with a positive attitude, they’ll often become the most ardent advocates for your organization. These employees are a great source of referrals — and may even return down the line.

Be sure to allow time for your HR department to conduct exit interviews when an employee leaves. Understanding why people leave will help you anticipate attrition and manage your retention.

Anytime an employee is leaving a role — even if they’re not leaving the organization — you’ll need to start the process of onboarding again. Even if it’s not a full-scale readjustment to the company, it takes some time to get comfortable in a new role. Just as critically, the person taking over the new role needs support to ramp up successfully.

These phases, including attraction, onboarding, development, and offboarding, are collectively known as the talent management cycle.

What is a talent management system?

A talent management system is the infrastructure that supports the core talent management processes of attracting, hiring, onboarding, engaging, developing, and exiting

Accountability to any initiative requires data. A talent management system allows organizations to track the effectiveness and implementation of their efforts. This is really important for something that (can be) as intangible as employee experience. Tracking the data prevents a “throw-it-against-the-wall approach” to employee retention and engagement. 

Qualities of a good talent management system

The most effective strategies provide data that makes a difference. Workday sums up this factor well, saying “A modern talent management system supports and facilitates the employee experience — and connects those experiences to the business strategy.”

So, in practice, what does a modern talent management system look like? Your system should be able to provide insight to the key areas of your talent management strategy. That includes well-being, performance, engagement, and belonging.

talent-management-employee-looks-at-colleague

Developing a talent management strategy

Here are some ways to begin building your talent management practices in each area, and why they’re important:

Well-being

It’s possible that no other factor has as direct of an impact on the day-to-day work experience than well-being. When we feel well, we perform better. When we don’t feel well — mentally or physically — our performance, resilience, and sense of belonging suffers.

It’s clear that investing in employee well-being makes sense, but how much, and on what? Having access to these metrics, both before and after you implement your strategy, is critical. It can help you figure out which interventions make the biggest impact on your team.

Performance

If well-being affects the employee’s daily experience, performance affects the manager. Leaders need their teams to perform. But just as importantly, when they’re not performing, managers need access to data to determine why

Your talent management system needs to have an accessible, insightful way to track and evaluate performance. If you can keep an eye on what makes your talent tick (and where they get stuck) you can plan processes to keep things running smoothly.

Engagement

Engagement is related to just about every positive indicator of business success. Highly engaged employees are significantly more productive, more innovative, have higher job satisfaction, and are more likely to lead inclusive teams. 

Your talent management program contributes to this in multiple ways. For one, it allows leaders to keep a finger on why — and what — makes people stay enthusiastic and involved with their work. For another, talent management systems provide a platform for feedback. Keeping track of this data reinforces that you care about their growth and development. It also gives employees the opportunity to be strategic about their career paths.

Belonging

Inclusion and belonging is the secret sauce that keeps an organization’s culture thriving. When people feel like they belong, they’re much more engaged, willing to take risks, and happier in their roles. 

Traditional measurement platforms often overlook belonging. But it is the strongest indicator of success in a role. An employee with the right skill sets won’t do well if they feel like they’re not welcome.

Final thoughts

Your team is your best investment. They’re the driving force behind your company culture, morale, productivity, and innovation. The company’s best opportunity for growth is to pay attention to what works and what doesn’t. The last thing you want is top talent leaving for greener pastures when you don’t know why.

If your metaphorical grass is turning brown, turning your attention to your talent management process can help you identify why. With insight and care, you can bolster your employee experience — at every stage — and help your organization grow.

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Published February 11, 2022

Allaya Cooks-Campbell

BetterUp Staff Writer

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