Talent Management (TM) is more than effective attraction and retention of talent. It also considers the performance dimension too. However, I would argue that performance management (PM) in TM is not about the conventional notion of PM that many think about – the annual setting of goals and objectives and the antecedent quarterly and annual monitoring assessments that follow. This notion of PM is HR centric – how the individual is doing vis a vis some set of expectations.
I believe TM centric PM is about ROLE performance. This is at its core an economic and organization design flavoured notion. In operational terms, this can be described as follows:
Role performance is the expected business contribution that can be made by a role filled with a fully competent and engaged person.
The attributes of competence and engagement are present to strip away any “noise” about variance due to individual performance differences. A common notion of individual performance variance is to band them in to A (star performance levels), B (the competent and engaged level noted above), and C (the deficient level which should be “managed out” of the role position).
How is this conceptualization of TM/PM useful?
When an organization has or fears that it will have a TM issue (usually means that there is a supply/demand concern present) I ask the client to do the following:
- What is the role’s current performance with B level contributors?
- What is the role’s current performance when it is done by an A level contributor? (what’s the difference?)
- Is it practical to fill the role with only A level contributors? How much additional value would be created and can this value (i.e., working capital) be freed up to better compete in the talent supply market place?
- If 3 above has limits, then how can we increase the performance value while filling the role with B level contributors?
- What are the inherent limits on role performance, and can we adjust them to achieve overall increase in value? This is not a simplistic question area as we will likely touch on organizational values and other HR considerations. This not about finding faster hamsters.
- What do we need to do to achieve these benefits?
The mantra around role PM is when we improve it we increase the “immunity” or the organization to its real/potential TM uncertainty and risks by:
- freeing up locked in working capital that can be used to better compete in the talent supply market place (the CFO’s dream – self funded improvement);
- potentially reducing the need for at risk talent by needing less talent to achieve desired (at least current levels) role performance;
- being able to rely on achieving desired role performance levels without A level performing contributors
The “spice” of this approach is we can push ourselves to think big. Can we improve role performance by a significant level (e.g., have 2 B level contributors produce as much as it took 4 A level contributors to historically produce)?
When I can help a client achieve these kinds of large scale enhancements, I know I have helped make a difference.