Talking Talent

Seth Godin has a suggestion worth considering: change the HR Department to a Talent Department.

His argument runs that in days of yore, factories consisted of people and machines. The goal was to use more machines, fewer people, and to design processes so that the people were interchangeable, low cost and easily replaced. The more leverage the factory-owner had, the better. Hence Personnel or HR. It views people as a natural resource, like lumber.

“Like it or not, in most organizations HR has grown up with a forms/clerical/factory focus. Which was fine, I guess, unless your goal was to do something amazing, something that had nothing to do with a factory, something that required amazing programmers, remarkable marketers or insanely talented strategy people.”

He says his suggestion to change HR to Talent makes some people uncomfortable because “it seems like spin, like gratuitous double speak. And, if you don’t change what you do, that would be true.”

“But what if you started acting like the VP of Talent? Understanding that talent is hard to find and not obvious to manage. The VP of Talent would have to reorganize the department and do things differently all day long (small example: talent shouldn’t have to fill out reams of forms and argue with the insurance company… talent is too busy for that… talent has people to help with that.)

Microsoft and Google both have a very healthy focus on finding and recruiting Talent. McDonald’s recently announced that they want to hire people who smile more. The first strategy works, the second won’t. Talent is too smart to stay long at a company that wants it to be a cog in a machine. Great companies want and need talent, but they have to work for it.

In the most recent issue, Workforce Magazine provided some stats on the top HR leaders among Fortune’s 20 Most Admired Companies.  Jason Corsello (who writes Human Capitalist blog) analysed those statistics and uncovered some interesting facts:

• Companies also appearing on the Best Companies to Work: 8 (40%)
• Average HR leaders’ tenure at their company: 15.2 years
• Years in top HR leadership position: 3.1 years (this is somewhat misleading as 50% of the leaders have been in their position less than 2 years)
• Demographics: Male 11 (55%), Female 8 (40%), Undisclosed 1 (5%)
• Average age of top HR leader: 48.8
• Youngest HR Leader: 35 (Laszlo Bock - Google, 35)
• Average age (male): 50.6 (52.2 without Laszlo Bock)
• Average age (female): 46
• Previous backgrounds: sales (Nordstrom, Goldman Sachs), legal (Target, UPS), product management (Microsoft, BMW)
• Facebook users: 2 (both female)

Also, 66 per cent of the companies included use VP/SVP of Human Resources as their title of choice.  Interestingly, Google and Southwest are more progressive and use “people” instead of HR (goes back to yesterday’s post about “talent” v “HR”.

While we’ve all heard the doom and gloom about the dire state of our nation’s skills shortages, let’s look at what organisations can do to keep the employees they have and maximise their potential.

To start with, it’s time companies started paying more than lip service to the often-recited slogan: “People are our greatest assets.”

While this basic reality is well understood by most companies, a fundamental change in people management is essential for organisational growth. If we really believe that people are our company’s greatest assets we should measure the importance of them within our companies.

So how do we put systems, processes and reporting in place to get better focus on the development of human and knowledge capital within organisations?

We need to measure, value and manage our most important asset - our people. Start by analysing the results of customer satisfaction and employee opinion surveys. Ask your employees whether they feel they’re well led, whether they understand where their organisation is heading, if they feel part of that direction and whether they feel engaged in where their leaders are taking them.

Organisations have much to learn about their achievements and challenges by consulting with their employees and customers. And more importantly, measuring staff and customer satisfaction can predict the company’s success levels in the next 12 months.

The future of any organisation relies on its ability to harness its human potential, and all business leaders wanting to succeed must aim to extract 100 percent from each and every staff member. If you compare the way we manage cash and inventory you wouldn’t survive running an organisation wasting up to 60 percent of those assets. We shouldn’t allow ourselves to waste human assets.

If your company is finding it hard to attract the best and brightest talent, then look to Google as a guide.

Google has built an employment brand (not to mention its product brand) in just a few years, almost entirely through viral marketing.  The company has been named Fortune’s top company to work for in America and the result is more than 3,000 applications a day from people wanting to work from them.

HR management guru, Dr John Sullivan, explains employment branding as a “viral-based perception management program designed to attract top-quality applicants is based on the premise that the organization is well-managed in the eyes of the target candidate population.”

It has many critical elements, only one of which pertains to getting the message out through awards programs, editorial content in target publications, presentations at conferences, and through viral marketing driven via the employee referral program. It is not the same as recruitment marketing, although recruitment marketing should be aligned with the employment branding effort.”

IBM, GE, Disney, Southwest Airlines and HP have adopted similar viral marketing efforts.  How do they do this?  “Their managers are sought-after speakers, their management practices are written up in business and professional journals, and they all have at least one best-selling book written about their management practices,” says Dr Sullivan. (See Dr Sullivan’s list of the many benefits of employment-branding).

While most corporate recruiting managers spend less than 5 per cent of their budgets on employment branding, the companies who adopt a long-term strategic strategies don’t have a problem attracting the right people – they have the enviable ‘sorting challenge’ of deciding which talent to choose.

Sometimes in order to effect change we need to see a dramatic and dire view of the consequences of our actions.

An Inconvenient Truth and The Stern Report moved the world to debate.  Because they were so ‘in your face’, both motivated people around the world to combat climate change and accept personal accountability for living an environmentally sustainable life.

I hope that those people who read the Living Longer Living Better Report will feel the same, as the ageing population could precipitate Australia’s economic and social decline.

This report, developed in conjunction with IBM, is intended as a contribution to the debate around the challenges of an ageing population and how they can be dealt with.  It’s aimed at policy makers, business leaders and social commentators and while it reflects a world position, it draws particular attention to the issues in Europe (although its author, Dr Chris Gibbon, has been in Australia talking about the impacts here).

With declining fertility and regressive employment practices in operation for decades, the solutions to these challenges will not take effect overnight. The economic and social (metaphorical) ‘super-tanker’ will take years to be turned around, so we need to change course now.

The issue of an ageing workforce is particularly pertinent in the recruitment industry, as it affects the quantity and quality of skilled people available. We know now that the problem is not a skills shortage - it is a population shortage.  Finding ways to tap into the global talent pool is an imperative.

Hello world and welcome to my new blog, Talking Talent.

The term ’skills shortage’ has dominated Australia’s business landscape for a number of years.  But what does it mean for Australia in the long term?  How can we capitalise on the pool of talent we already have?  And how can we overcome the labour constrictions we currently face to ensure our economic prosperity both now and into the future?

A skills shortage, in plain and simple terms, means that businesses are struggling to fill vacancies.  Skills shortages are occurring across Australia’s economy – both in the trades and the professions.  We simply don’t have enough architects, plumbers, engineers, nurses, computer programmers, teachers and electricians to go around.

In the latest report from the Department of Education, Employment and Workplace Relations, the occupations showing the biggest increase in vacancies were medical and science technical officers (including radiologists, hospital pharmacists, sonographers and dental technicians), organisation and information professionals (such as project managers and specialists in Java, Internet Security and PeopleSoft) and accountants and auditors. But almost every industry is affected in some way, particularly in regional areas.

According to the Australian Chamber of Commerce and Industry’s Survey of Investor Confidence, skills shortages are the number one constraint on small and medium business investment.

In knowledge economies such as Australia, where skills are fundamental to competitiveness, skills shortages can reduce productivity and increase inflation.  As the pool of available workers dries up, salaries skyrocket and so do the prices of the associated products and services.

So, what’s the solution?  Over the next few months, Talking Talent will explore ideas and options to secure Australia’s talent base.  And I invite you to join the conversation.