There is an old adage: If it ain’t broke, don’t fix it. This post will explore why this is the worst advice when dealing with uncertainty and risk (U&R) and examine this proposition within the talent management (TM) arena. This post is inspired by a an article by Dan Healing in the 23 August, 2011 Vancouver Sun titled: “Manage investment risk on the way up, not when the markets head down, experts say”; page C3.
The article suggests that investment risk is managed by doing appropriate portfolio balancing and that this is not a good activity when markets crash. Another point is the value of diversification in investments which provide a a defence against the unpredictable (uncertainty) changes in world markets.
TM is defined as:
Continuously meeting our timely access and use of talent needs in highly effective business driven ways.
Thinking about this description, one will be struck by the analogy to the skill of navigation.
Sound navigation is always goal driven. Also, it is planned out ahead of time to meet speed, safety, comfort, cost, etc. concerns. Also, there will be assumptions about “turbulence”, “weather”, and other conditions expected along the journey. All of these will be made with the best information available and with whatever insightful experience that can be brought to bear. Yet, the future is uncertain, hence all assumptions tend to be wrong to greater or lesser degrees, this why we do navigation course checks along the way and adjust our journey accordingly. Sometimes we meet unexpected extreme conditions and at these times we focus on survival. What we don’t do during these extreme moments engage in vacation planning. Depending upon our experience, we may realize that after the “storm” we need to make another plan.
TM is no different, if it is done properly. It is a plan about the future, not the current crisis. It makes assumptions of needs (what, how much, in with what qualities and attributes, and in what forms, etc.). There are assumptions about the conditions we expect to encounter. Again, if we meet a difficult situation, we focus on survival (the shortest of time frame planning), not mid or long term planning.
This is why, I recommend to clients that they take at least a five year view of their critical TM needs. Actually, I will encourage them to take a ten year WAG. The role of periodic “navigation” checks, keeps the long term plan sane and sensible.
Therefore, TM is about managing U&R on the way up.
The second point (the value of portfolio diversification) made by Dan Healing is also instructive. TM if it is done well, includes diversification within it. This creates ready flexibility and adaptability as we meet changes to what we expect the future to have looked like.
When I work with a client on an important talent area, I encourage them to build a TM plan that has three means for achieving success. A primary strategy and two active subordinate strategies that we can “dial up” or “down” as we deal with exigencies.
Organizations that just rely on meeting their critical TM needs through staffing are running the risk of relying on a “one trick pony” during a talent impacting storm. However, many organizations have difficulty in seriously considering any strategy other than staffing so we have to look to complementing staffing strategies to meet this goal of increased TM diversification. One area that I typically suggest is complimentary investments in technology that enhance talent performance at reduced cost.
If we can boost the quality and quantity of talent performance at reduced cost, we are building in a fiscal cushion to future vagaries.
These are strategies that are impossible to think, decide and implement during a difficult business moment.
Again, this demonstrates the value and necessity of doing TM before you need it.