At the beginning of July, I gave a presentation at the Heilbronn Online Strategy and Controlling Congress, which was intended to give impulses on how HR transformation can strengthen companies in a crisis. I made a (hopefully) fiery plea for organizations to become more employee-centered in the digital transformation despite the pandemic. Moreover, talent management must be placed on the CEO agenda as a matter of urgency. While rummaging through the daily news feed this morning, I read the following headline in business magazine WirtschaftsWoche Online: “Attracting and retaining talent – the corona crisis has made this a top priority for many CEO”. (https://www.wiwo.de/erfolg/management/kpmg-studie-corona-hat-die-sicht-von-ceos-radikal-veraendert/26121034.html).
This article presented the results of the “CEO Outlook” survey from July to August 2020, which was conducted by KPMG. This is a quote from the study: “Suddenly there is hardly any talk of climate change. Instead, the biggest concern of CEOs is to attract and retain qualified employees.” Apart from the fact that solutions to climate change should under no circumstances be treated as a secondary issue, I was of course very pleased with the results of the KPMG study and also with the fact that my plea obviously worked 😉 But what causes the change of priority in German executive floors? And how can organizations respond to this concern of CEOs?
Does the War for Talents exist in times of crisis? – Long live the new definition of the War for Talents!
In the pre-Covid 19 era, one of the biggest challenges for digital transforming organizations was to attract the best digital heads. Then the lockdown supposedly brought the “War for Talents” to a standstill. To this day, many companies cut their budgets for human resources and relatively quickly have frozen the hiring process indefinitely. In many industries it is a matter of bare survival. Business activities have been trimmed to strengthen liquidity. Are these only organizations whose CEOs did not participate in the survey? I don’t think so. Unfortunately, all too often I perceive that the ambitions of digital HR transformation to anchor more employee-oriented HR and management models are too quickly discarded by top management and declared as luxury problems or simply fail because of a lack of implementation skills.
The crucial question for me is therefore to what extent a company can afford to drop a sustainable orientation in a severe crisis. What comes after the improvement of the miserable business situation? What happens after the existence is secured? What price does a company have to pay if effective human resources and management suffers from the crisis mode?
In the above-mentioned talk, I put forward the argument that pushing back employee centricity because of a crisis only evokes the next crisis, namely a crisis of lacking potential. And this can anyway happen to organizations in the digital era. After all, how are the next steps in the digital transformation that are so important to be taken if the human potential in the organization is lacking or not being developed? In my view, many companies will find it difficult to compensate for the consequences of the pandemic and the continuing challenges of digitization if only minimal attention is paid to employee potential. It is very unlikely that the pandemic will flush a lot of digital talent onto the market and thus put an early end to the War for (digital) talents, given the huge demand for digital experts. So, what should we do? I personally find the formulation in the KPMG study very interesting. While many companies seem to be looking for the top potentials, German CEOs speak of being attractive to qualified employees. Is this the farewell to the exclusive top talent, which is obviously so rare that the fight for her and him is no longer worthwhile?
For a long time now, I have been promoting a different talent definition among my clients. Promoting a talent definition that finally fits the trends of today’s working world such as demographic change, changing social values, diversity, longer working lives. Organizations can no longer think talent management only in terms of filling key positions. We need new ways to promote the talents of our employees. I love to use the term talent economy for this approach, which expresses the need to make the best possible use of many employee skills within the company. And this is a matter of utilizing the strengths and potential of the baby boomers as well as those of the younger generations. Successful, effective talent management is inter-generational and values the potential of young and old alike. With this approach, talent growth becomes an organizational maxim.
Dear executives, please pay attention: talent growth as a central pillar of corporate management
If the paradigm shift in organizational talent definition is successful, organizations will create a larger talent pool, as desired by the CEOs surveyed. This will help them to be ready for organizational challenges of the digital age. Talent growth must therefore become part of an organization’s identity. It then constitutes the management philosophy and provides a guideline for the individual and collective behavior of both employees and superiors. The values underlying the Talent Growth philosophy, such as the meaningfulness of work and the appreciation of the talents and strengths of the individual and the collective, are expressed in HR management policies and leadership principles. The leadership and organizational culture shows whether and how talent growth is actually implemented. The culture is essentially shaped by leadership practices of the management. Therefore, we need talent growth leadership mindset for, which can free itself from the traditional notion of superiors and subordinates if necessary. In parallel, there is also a need to dissolve the previous dividing line between the disciplines of human resource management and leadership. For the successful implementation of a Talent Growth leadership philosophy, HR and Leadership must merge as a common source of modern corporate management. Talent Growth aims to develop a strong emotional bond between employees and the employer. This increases the recommendation rate as an attractive employer, which in turn attracts more talented candidates.
The following figure shows the elements of the Talent Growth philosophy:
The conclusion: anchoring Talent Growth as a corporate maxim
Will talent management also become more important in times of crisis like the one we are facing currently? I am very optimistic! Organizations can only emerge stronger from crises in the long run if they have talents that can shape can manage and shape the digital transformation. Therefore, talent management must become a pillar of corporate management to be able to develop the potential of their employees and attract new talent. In this context, talent management must not (any longer) be understood as an institutionalized succession tool. Successful talent management considers the potential of the entire organization. It aims to promote the learning and performance capabilities of the largest possible number of employees. Talent Growth thus becomes part of a corporate philosophy that is expressed in a leadership and organizational culture characterized by meaningful work, talent development, the use of strengths and appreciation. Let’s tackle it!
August 26, 2020