Module: Managing the Human Resource Unit: Developing the Human Resource Lesson: Developing and Retaining Key Personnel © 2016 Arden University Ltd. All rights reserved. Arden University Limited reserves all rights of copyright and all other intellectual property rights in these learning materials. No part of any learning materials may be reproduced, stored in a retrieval system or transmitted in any form or by any means, including without limitation electronic, mechanical, photocopying, recording or otherwise, without the prior written consent of Arden University Limited.Developing and Retaining Key Personnel Retaining Key Personnel Given the labour supply ‘crisis’ and the rapidly-changing business environment, it is now more important than ever before for organisations to retain key personnel. In this lesson we look at the concepts of talent and career management. The recorded lecture introduces you to what Talent Management and Career Management is and what is involved for the HR practitioner. The Powerpoint slides at the end of the lesson provide a summary of the lesson’s key points and useful diagrams. The further and wider reading indicated at the end of each lesson will enable you to think critically about the concepts and ideas that have been introduced to you in the lesson notes and recorded lecture. Lecture Introduction Throughout the module so far we have highlighted that key personnel with the right skills and knowledge are valuable to an organisation and we have discussed training and developing them, harnessing their knowledge and sharing it throughout the organisation, along with considering whether we want to be an employer of choice and the impact that this has on reward schemes, recruitment policies and staff retention. Another way of attracting and keeping key personnel is to have a policy of talent management and assist them with their career management. In this final lesson, we shall look at just that. Talent Management Strategy What is talent management? Mullins (2010) suggests that talent management is a strategic approach which has emerged in recent years that looks to gain competitive advantage through: recruitment performance management training and development succession planning, and employee engagement. © 2016 Arden University Ltd. ALl rights reservedCranfield Management have explored what employers believe talent management is and how it works in practice, with some surprising results. Take a look: Armstrong (2012), however, suggests that the notion of talent management is nothing new and only emphasises what organisations have always done and that, whilst there are different approaches to talent management with regard to who is included and how, most organisations’ approaches incorporate potential assessment, leadership and management development, succession planning and career planning, stressing that the fundamental concept is ‘the need to engage in talent planning to build a talent pool by means of a talent pipeline’ (p256) even if, as Beardwell & Claydon note (2010), the actual definition is still somewhat open to interpretation. One of the key differences between definitions is what organisations consider ‘talent’. Some can include personnel at all levels regardless of their job role so long as they are making a difference to organisational performance, whilst other organisations adopt a more exclusive focus and consider only personnel they believe to have high potential and can make greater contributions in the future (CIPD, 2012). Read more about how the CIPD describes talent management and what it incorporates with your free registration at: http://www.cipd.co.uk/hr-resources/factsheets/talent-managementoverview.aspx ABB recognises the value of all staff and as part of the ‘Meet The Boss’ TV programme in 2009, advises that talent management forms the spine of its people management strategy but recognises that managers and leaders play a huge role in both securing and nurturing talent, hence the importance of management and leadership development. See a clip of the interview here: This could explain why some organisations focus their energies on potential high-fliers, tomorrow’s managers and leaders and has led to a distinction between the two, with management succession planning for senior positions and career management for other key positions and people throughout the organisation. How do organisations that you have knowledge of retain talent? If there is a strategy, is it undertaken in a more formal or informal way? © 2016 Arden University Ltd. ALl rights reservedWhat isn’t disputed, however, is that talent management is central to ensuring that higherquality staff in comparison to competitors are in place to meet the organisation’s objectives today and tomorrow (Armstrong, 2012; Beardwell & Claydon, 2010) through bundling the practices which the organisation already undertakes and using these as a vehicle to coordinate and support approaches to attract and retain the people that the organisation needs. Kevin Groves, Assistant Professor at the Graziadio School of Business and Management, discusses why talent management is more important now than ever before. Whilst tailored towards the health sector, the message is applicable to organisations in other industry sectors. Who’s got Talent? The realities that have led to this ‘war for talent’ and the implications of such are discussed further in the McKinsey-published paper for Harvard Business School (Michaels, Handfield Jones, Axelrod, 2001) which can be accessed here: http://www.opentec.com/pdf/the_war_for_talent.pdf and is a recommended read, explaining why it has become increasingly important for organisations to take talent seriously. A talent management strategy needs to support the organisation’s plans with regard to recruitment, development and retention of staff as highlighted above to ensure that the human resource and skill requirements required today and in the future are available through both internal and external recruitment, with an emphasis on the internal labour market. Whilst there are arguments for giving priority to internal recruitment (retention of key personnel, motivational) and against (may not get the best person for the job, reduces the available talent pool, lack of new ideas and industry expertise), so different organisations will determine their own strategies with regard to internal and external recruitment policies (Beardwell & Claydon, 2010) and this will often vary dependent upon the position being recruited for. The CIPD Recruitment, Retention and Labour Turnover Survey (CIPD, 2009) also reports that to overcome skills difficulties, organisations often recruit staff with potential to grow and provide appropriate training to overcome skills shortages and thus are building the talent pool mentioned above, utilising an internal supply chain in what is sometimes referred to as ‘the war for talent’ following McKinsey & Co. coining the phrase in the 1990s. McKinsey suggests that organisations need to make working for them attractive, develop a long-term recruitment strategy, promote coaching and mentoring and job rotation and enrichment to cultivate internal talent, invest in people and recognise that talent is needed at all levels, but that different categories of talent require alternative strategies (Armstrong, 2012). Armstrong (2012, p257) cites Iles & Preece (2010, p248) who identified three main perspectives: ‘Exclusive people – key people with high performance and / or potential irrespective of position Exclusive position – the right people in the strategically critical jobs Inclusive people – everyone in the organisation is seen as actually or potentially talented, given opportunity and direction’. © 2016 Arden University Ltd. ALl rights reservedThe first two are most common, according to Clarke & Winkler (2006, cited by Armstrong, 2012) and this reiterates what has been highlighted above, that one of the reasons for having specific policies with regard to management and leadership development is due to the important role that people in these positions have in terms of recruiting, identifying and nurturing talent throughout the organisation and the influence that they have over the organisation’s future performance. The best practices in winning this war for talent including succession planning is the focus of the Recruitment and Retention conference with a panel of senior HR professionals from a range of US organisations. View the session here: http://www.youtube.com/watch?v=fSwj98ozSVQ The CIPD acknowledges that talent management is a challenge for many HR executives and organisation CEOs and has produced a podcast about the development of talent management strategies and why it is still important. This is available via the CIPD’s website at: http://www.cipd.co.uk/hr-resources/podcasts/24-strategies-attracting-retaining-talen... and also here: Talent Strategies The Talent Management Process Figure 1.05 – Talent Management Process © 2016 Arden University Ltd. ALl rights reservedThere are several models illustrating the process of talent management but all are similar in that they start with the business strategy and talent planning and incorporate recruitment and selection, talent and performance management, development and career management / succession planning for those within the talent pool. Read more about what is involved in each element in Armstrong’s Handbook of Human Resource Management pp 258–261, the management study guide at: the CMI’s publication ‘Talent Management: Maximising Talent for Business Performance’ (2007) available at: https://www.managers.org.uk/sites/default/files/user35/CMI_-_Talent_Managment_Nov_20... and the Society for Human Resource Managers Review at: http://www.shrm.org/research/articles/articles/documents/0606rquartpdf.pdf Also, check Changeboard for tips from Bob Little about creating a successful talent management strategy: http://www.successfactors.com/en_us/lp/articles/strategic-talent-management-training... and the results of the CIPD’s Resourcing and Talent Management Survey 2012 at: http://www.cipd.co.uk/hr-resources/survey-reports/resourcing-talent-planning-2012.as... Career Management and Succession Planning Throughout the process of securing, retaining and nurturing the individuals within the talent pool, however wide that is and who it includes, is consideration of their career management and succession planning. Are they the same thing? Not quite is possibly the correct answer. Succession planning is usually (but not always) discussed in relation to management and, from the talent pool created, organisations ensure that it has the managers with the skills it needs to meet future organisational needs. Career management is more concerned with opportunities for staff to develop careers so that the organisation has a flow of talent whilst individuals can meet their own career aspirations too. © 2016 Arden University Ltd. ALl rights reservedFigure 2.36 – Career and Succession Planning You will read about both concepts being called either succession planning or career planning. Management Succession Planning View the CIPD’s worksheet on Succession Planning using your free registration at: http://www.cipd.co.uk/hr-resources/factsheets/succession-planning.aspx The driving forces for succession planning is talent replacement and ensuring that those replacements have the skills, and, in leadership positions, the vision, to enable organisation survival (Armstrong 2012, TopMBA 2012). Read more here: http://www.topmba.com/emba/articles/succession-planning and watch the video by McConnell which highlights some valuable key reasons for organisations adapting succession planning strategies: Beardwell & Claydon (2010) suggest that succession planning requires identification of individuals or groups of people to fill specific roles (note the plural) in the future, whether they currently exist or not. If the environment is stable then it is easier to identify individuals for specific existing roles, hence why organisations need to remain flexible and work with groups of people for a range of possible roles by linking development to competency frameworks rather than specific tasks. © 2016 Arden University Ltd. ALl rights reservedFigure 3.07 – Succession Planning Starting with forecasts about future management positions, organisations look internally to staff and, using performance reviews, talent audits and reviews, identify potential future managers and management development undertaken. These assessments will consider employee readiness – ready now to undertake a more senior role, will be ready in a couple of years, etc. Progress of these individuals will be monitored regularly with the intention of retaining these key personnel for promotion as vacancies arise (Armstrong, 2012). In more stable environments or where the need for a successor is imminent, it is possible to more closely identify and then develop the skills, knowledge and ability required by the potential successor, and more specific and bespoke development can be undertaken for a specific identified person who will be the successor. Read more about leadership development and successor planning in this journal article by Groves, available at: https://bschool.pepperdine.edu/appliedresearch/content/groves3.pdf which highlights the benefits of closely linking succession planning with leadership development and using current managers in the process of identification and mentoring. © 2016 Arden University Ltd. ALl rights reservedWhilst management succession planning might appear to be a very good idea for organisations in an environment with increasing skills shortages, what disadvantages can you identify? How could these be managed? (You may need to undertake some further research and reading if you are having difficulty thinking about the limitations of succession planning for managers.) Career Planning Complementary to management development, career management enables a flow of talent and opportunities for staff at all levels. In theory, it enables individual aspirations to be aligned with the organisation’s future staffing needs and undertaking (not necessarily provision of) appropriate development to enable that career progression, along with opportunities to demonstrate ability and utilise skills gained (Armstrong 2012; Hirsh et al., 1995; Moran, 2012), with Moran advising that it really is a ‘win-win’ situation for both parties. Given the environmental uncertainty leading to lack of specific knowledge as to exactly what future roles will require (Hirsh et al., 1995) as highlighted when looking at management development, initiatives aimed at staff development have put some of the onus on employee self-development, ensuring that they have the skills, knowledge and ability for potential future roles and maintain the skills and competencies required for their own role as it changes with the changing business environment. Read more about these current issues highlighted by Hirsh et al. here: http://www.employment-studies.co.uk/what-we-know-about Armstrong (2012) highlights that career management requires policies regarding the extent of its promotion from within policy versus external recruitment for new blood, how an organisation undertakes talent spotting, career planning and development programmes and reviews, including enabling staff to move department to further their own careers / provide further challenges for them given lack of promotional prospects, if they wish to do so. The process of career management itself starts with performance and assessment of individuals through these talent audits and on-going career planning reviews as development is undertaken. Not all potential moves need be hierarchical; they can be lateral within the organisation too and need to be supported with activities which demonstrate the organisation’s commitment to career planning, such as posting all internal vacancies, counselling and mentoring by line managers, effective performance appraisals, PDPs and HR involvement through counselling, career workshops, etc. Armstrong (2012) suggests that what is key is the identification of career paths and the competencies that are required by individuals to pursue these and enable individuals to identify their own development needs, with provision of identified development possibly being arranged by the organisation, but, as individuals become increasingly responsible for managing their own careers, equally so their own development. Read more about career management in Armstrong’s Handbook of Human Resource Management, pp 262–267. As can be seen, the two concepts are closely linked and incorporate some of the same activities, directed in a different way. © 2016 Arden University Ltd. ALl rights reservedTake a look at IBM’s Global Talent Management Strategy. IBM is known for focusing only on the top 10% of employees (Armstrong, 2012). http://www.shrm.org/education/hreducation/doc uments/boudreau_modify%20ibm%20case%20s... Also, Sir Bill Jeffrey, who was the UK Permanent Secretary Ministry of Defence and Civil Service Diversity Champion, published a guide for the UK Civil Service on how to implement a Talent Management Strategy which also reflects diversity and includes some practical and useful tips and information. It is available here: http://www.successfactors.com/en_us/lp/articles/strategic-talent-management-training... Think about your own career plans and your personal development plan. You will need to construct a PDP if you do not have one. Help for you to do this is available from Anglia Ruskin at and supporting quality reading from the following links: and Consider the organisation’s environment. Talk to senior personnel, both internal and external to the organisation. Can you foresee changes to the skills and capabilities that you have identified you will need for your current career plans? How will this affect your personal development plan? Would an appropriate talent management strategy incorporating management succession planning and career management be beneficial for your organisation? What advantages and disadvantages might there be to the introduction of such a strategy? Consider your own organisation or one with which you are familiar. How would you develop a talent strategy? Would it concentrate only on senior positions or positions throughout the organisation? How would you identify talent? How would you develop talent? Why? Further and Wider Reading © 2016 Arden University Ltd. ALl rights reservedIn addition to the reading recommended within the lesson: Essential Reading Armstrong M, 2012, Armstrong’s Handbook of Human Resource Management Practice, Kogan Page Part 2 Chapter 15 and 16; Part 3 Chapter 21; Part 4 Chapter 25 Lawlor E, 2003, Creating a Strategic Human Resources Organization, Stanford University Press Chapter 3 pp 36–43 Mahapatro B, 2010, Human Resource Management, New Age International Chapter 4 Wider Reading Armstrong M, 2010, Essential Human Resource Management Practice, Kogan Page Chapter 14 pp 198–208 Beardwell J & Claydon T, 2010, Human Resource Management: A Contemporary Approach, 6th ed, Prentice Hall Chapters 5; 9 Redman T & Wilkinson A, 2009, Contemporary Human Resource Management: Text and Cases, 3rd ed, Prentice Hall Chapter 13 Summary Lesson 3 Unit 3 Summary References Armstrong, 2012, Armstrong’s Handbook of Human Resource Management Practice, 2012, 12th ed, Kogan Page, London Barrett & Dewson, Sectoral Support for Training: A Review of International Practice, ECOTEC Research and Consulting Ltd, Department for Education and Employment, July 1998, Research Report No 68, available online at: https://www.education.gov.uk/publications/eOrderingDownload/RB68.pdf CIPD, 2012, Talent Management: An Overview: cipd.com, available online at: http://www.cipd.co.uk/hr-resources/factsheets/talent-management-overview.aspx accessed 18/10/12 © 2016 Arden University Ltd. ALl rights reservedHirsh et al., 1995, Careers in Organisations: Issues for the Future, Institute of Employment Studies Research, Report 287, available online at: http://www.employmentstudies.co.uk/publications Infed, 2012, Learning in Organizations – theory and practice, available online at: http://www.infed.org/biblio/organizational-learning.htm accessed 17/10/12 Kim, 1993, The Link Between Individual and Organizational Learning, Sloan Management Review, Fall 1993, pp 37–50 Moran, 2012, Career Management a win-win for the organisation and the employee, HR Magazine 16/01/2012, available online at: http://www.hrmagazine.co.uk/hro/hr-on-the-boardblog/1020703/career-management-win-w... accessed 18/10/12 Mullins, 2010, Management & Organisational Behaviour, 9th ed, Prentice Hall Oxford Dictionaries, 2012, Development, available online at: http://oxforddictionaries.com/definition/english/development Redman & Wilkinson, 2009, Contemporary Human Resource Management, 3rd ed, Prentice Hall, Harlow TopMBA, 2012, Succession Planning, TopMBA.com, available online at: http://www.topmba.com/emba/articles/succession-planning accessed 18/10/12 Winterton, 1998, The Role of Social Dialogue in European Approaches to Vocational Training, EURODIAS, European Trade Union College Powered by TCPDF (www.tcpdf.org) © 2016 Arden University Ltd. 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