Talent Management Issues: “Source of the Nile”

This BLOG posting will outline my perspectives on the place to begin when dealing with TM issues.

As a principle, I view talent management (TM) issues as a symptom or consequence of a cause. And like a headache, treating the symptom may provide momentary relief , but it is not a cure.

As I outlined in an earlier BLOG I see TM as the management process for:

“Continuously meeting highly effective access and use of necessary talent as and when we we need it.”

When considering this description the logical place to begin a TM issue enquiry is to start with the “use” component. How we choose to use talent is the source of all TM issues.

First, let me deal with the TM “red herring”” the source of TM issues are based on demographic/market supply issues. I accept that demographics and market supplies are huge when it comes time to considering the following: will we be be able to access the desired talent; and, will we have difficulties in retaining this access over time? The conclusion then is demographic/supply markets issues are contextual, they are part of the operational environment all organizations deal with. Hence they are non discriminatory.

Yet, not all organizations who seek similar talent, face the same difficulties in obtaining and retaining access to it. This means we need to look within the organizations themselves for answers.

Conventional TM perspectives will ask us to focus on our attraction and retention practices and will suggest we look at “best employer” practices as inspiration to the cure. Clearly any organization that ignores best employer like HR practices risks being unattractive as a place for employment.

But not always, it depends upon what the prospective employee looks for in their next job assignment and whether this “less than ideal” employer provides that. In other words people can join up with organizations because they provide benefits that meet satisfying their individual work/career priorities.

The fundamental underlying concern I have with relying on best employer practices is doing this provides little sustainable competitive advantage. All organizations have access to the same research findings, and depending upon their access and the cost of working capital, they can implement these practices into their way of doing business.

I like to help clients seek TM strategies that provide an uncontested market space and make the competition irrelevant (the Blue Ocean Approach as described by WC Kim and R Mauborgne).

This leads to the central thesis in this BLOG posting: your business model establishes the degree of uncertainty and risk exposure (U&R) that you will face. Why?

First, your business model will determine the relative “burn rate” for its resource inputs (working capital and talent). If your resource usage is high and or inefficient, then you are exposed to the quantity and quality of market supply available to you.  How much and often you need to go to market to meet your talent needs creates the affordability and  U&R exposure. Most of us understand this notion as it applies to an organization’s cash flow working capital needs.

Second, your business model exposes you to competition. Firstly, your business model determines the level of financial competitive advantage you can achieve – implications on your ability to “outbid” for limited resources. Secondly, it exposes you to talent markets that may be in short supply. Do you need to get access to talent that is already hard to find? This may be because the talent is absolutely limited in numbers or quality to begin with. Or the supply is effectively “locked up” by your talent seeking competition.

Any business model has consequences regarding exposure to TM U&R. The only questions are:

  • Do we have a specific TM U&R exposure that concerns us (i.e., it could be a show stopper)?
  • Given this talent U&R exposure are we confident/comfortable in dealing with it?

If no, then we need to review our business model somehow.

This insight came to me several years ago when I read a story of how a high tech firm was deciding to bring a new product to market. This firm had the reputation to get sufficient funding, business/project acumen,  and the technical capabilities to successfully develop this project. It looked like a “winner”. So they proceeded with the project. About six months before operating the new product facility they began recruiting. This included seeking about two dozen specialized software engineers. What they shocked to find was there was an insufficient market supply of this talent. It got worse, they found their current internal supply of this talent was being poached by other firms, so they were losing internal capability.

  • The result: the project floundered, no return on the project’s sunk working capital was ever realized.
  • The learning: when the strategy to proceed with the project was being decided, there was knowledge that the supply of this particular engineer was problematic. This U&R knowledge was never tabled and shared (it wasn’t really sought for either and the source did not really understand the success/failure linkage either). It was an avoidable outcome.

I found this story fascinating and frustrating at the same time. I realized that this scenario could/would happen to almost any organization. The outcome led to my journey into TM.

The practical effect of this learning on my consulting practice includes these two levels:

  • When involved with strategic planning level work, I approach the issue of U&R with a serious TM implications enquiry. This can mean that the business model choice needs to be modified to incorporate more acceptable levels of perceived talent U&R.
  • When dealing with TM issues within an existing business model (the most common consulting assignment) I seek solutions that moderate the exposure to TM U&R by seeking business model changes that address talent usage. Make better usage and the exposure of the organization to the market supply environment is reduced AND the business obtains better return on the working capital tied up with that particular talent. I am not keen to see adopted TM strategies that reduce talent U&R while increasing potential exposure in other business areas.

What could be a “fantasy level” solution? The business model is profitably shifted such that the organization no longer needs to draw upon the highly U&R exposed talent. This is the double win: reduces TM U&R and improves the bottom line.

I have also learned is that clients are quite  capable of identifying creative systemic solutions to their TM issues. AND, most often the solutions are simple in nature (often a correlation between simplicity and effectiveness).

What thoughts come to your mind when considering my thoughts?


About 123stilllearning456

As a management consultant I am passionately interested in talent management and risk/uncertainty issues. In the area of talent management I propose that we seek strategies that look beyond the staffing/employee centric frames of reference. I have been frustrated at the "closing down on possibilities" by these more conventional staffing/employee centric approaches. I have been impressed where people have found systematic solutions to their talent management issues by going beyond the conventional approaches. In the area of risk and uncertainty, I am interested in making this topic relevant to more normal decision making situations. My conceptual foundation is to use the micro-economist's fixed/variable cost theme. I also think it is important to look at these issues for people through their emotional and psychological lens. As a premise I think risk and uncertainty only exist where there is a person who cares about possible events and its consequences. Hence, risk and uncertainty are social based concepts (no sentience, no risk and uncertainty). A major influence on my thinking in this area is Nassim Taleb of "Black Swan" fame. This BLOG provides me with an opportunity to express my thoughts on topics that interest me. As this is an online diary, content is more important to me than polish. I apologize if this distracts from readers' enjoyment and learning. Still I find this a useful way to live up to my namesake, learn more from others and hopefully provoke creative thoughts and ideas in others.
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