BULLETPOINT FOCUS REPORTS
FOR THE THINKING MANAGER
Nurturing Talent
2
G
3
G
The War Goes On ...
... But the Battleground
is New
4
G
Defining Talent
5
G
Managing the Talent
Supply
6
G
Finding Talent
8
G
The Origins of Talent
9
G
Strategies to Nurture
Talent
10
G
Nurturing Leadership
Talent
12
G
14
G
16
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Nurturing Knowledge
Workers
The Talent Manager
References &
Further Reading
The Leading Skills Portfolio
REPORT 5
NURTURING TALENT
Ten years ago, a landmark McKinsey report warned companies they were entering
a war-zone for talent. Now a follow-up study finds that not only is war still raging,
but the fighting is about to intensify. CEOs, meanwhile, talk a lot about talent. But
‘jaw, jaw’ will never resolve this ‘war, war’.
BULLETPOINT
FOCUS REPORTS
I N S I G H T
INSPIRATION
SOLUTIONS
K N O W L E D G E
IN
JUST
16
PAGES
How companies can respond to increasing talent shortages is the subject of this
report. More specifically, it focuses on how companies can nurture their own talent
in a market where poaching is becoming an increasingly expensive and ineffective
strategy. The report begins with an examination of trends that are changing the
battleground for talent and moves on to look at what we mean by talent and how a
new approach, using ideas taken from supply chain management, is providing a
cost effective solution to managing the talent supply. It then considers:
G
how to attract the right talent: ie people who will fit in, engage with your culture
G
how talent is created: taking what psychologists know about elite performers in
other fields and applying those lessons to the world of business
G
the specific nurturing needs of leaders and knowledge workers: two very
special groups of employees that all organisations depend on for their success
Finally, the report finishes with a brief look at the key skills needed by every talent
manager and a questionnaire to help you assess your talent nurturing abilities.
THE WAR GOES ON ...
TALENT PAYBACK
G
G
G
G
Watson Wyatt Human Capital
Index: firms with best HR
practices provided three times
higher shareholder return over
five years than firms with
weakest practices; also some
evidence that good talent
management drives financial
performance, not the other way
round
Great Place to Work: an
investment of £100 made in
2001 in the best UK workplaces
was worth £165.78 in 2006
against £131.75 for £100
investment in FTSE All Share
Index; one reason? absences in
Top 50 workplaces are a third
lower than national average
Investors in People (IIP): HR
changes made in IIP firms over
three years to 2004 increased
profit by 7.16% of sales against
3.78% of sales for other firms
Founder Bill Gates once remarked that if you took away its top 20 people, Microsoft, one of
the most successful, influential and radically innovative organisations of its generation, would
become an ‘unimportant company’.
Ever since McKinsey first coined the phrase ‘The War for Talent’ in its 1997 study, the idea
that people are the biggest source of competitive advantage has become part of every CEO’s
mantra. But while firms like Microsoft have been parking their tanks on the lawn, most
organisations have done little more than raise an enfeebled battle cry in this talent war.
Ten years after its original research, a follow-up study from McKinsey finds:
G
G
And yet when it comes to action on talent, apathy and denial is nearer the response:
G
human investment: peoplerelated costs now account for
more than two-thirds of
organisational spending
McKinsey: 75% of top execs
say their companies are
‘chronically talent-short across
the board’
O
CIPD Learning and Development Survey 2006: almost half of organisations
undertake no talent management activities; of the 51% that do, only 38% have a formal
strategy, only 20% have a formal definition of talent
O
Society of Personnel Officers in Government Services (Socpo): 80% of leaders in
the public sector believe their organisations put insufficient time, energy into
managing talent; 68% of public sector managers confess to relying on ‘gut feeling’ to
identify star performers
O
Cranfield School of Management: fewer than half of UK businesses have talent
development programmes; 6 in 10 say talent management is essential to increasing
profit but only 4 in 10 strategically manage star talent
Talent matters
One explanation for apathy: in their hearts, managers don’t really buy the argument that good
people = good performance. But when managers fail to take talent seriously, they:
G
weaken the bottom line
The Institute of Employment Studies recently devised an index around bundle of 12 key
people practices; found firms that improved these practices, increased index score by 10%,
and could expect to see rise in gross profits per employee of between £1,000 - £1,500
a year; piecemeal introduction of single practices, however, had little effect on
business success
TALENT FACTS OF LIFE
G
talent is an unresolved and increasingly serious managerial headache
business leaders say finding talented people is likely to be the single most important
managerial preoccupation for the rest of the decade; nearly half of leaders expect
intensifying competition for talent to have a major effect on their firms over the next five
years; no other global trend is considered nearly as significant
1) those concerned with
acquisition, development of
employee skills
Significantly, the management of
people had a greater effect on
performance than business
strategy, R&D, quality or
technology.
the talent shortage remains as acute as ever and is probably worse
thanks to a fast-changing demographic landscape; question marks over the quality,
appropriateness of talent sourced in emerging markets
CIPD: examined causes of
differences in productivity and
profitability in manufacturing
companies over ten year
period; found a positive
relationship between employee
attitudes, organisation culture,
talent practices and company
performance; two sets of
practices were seen as
particularly significant:
2) those concerned with job
design including skill
flexibility, job responsibility,
variety, use of teams
Chapter 1
G
spend their time continually shopping
or poaching other people’s talent; apart from expense, the ‘hire rather than nurture’
strategy, means teams are often left rudderless while positions remain vacant; hardworking
staff, forced to take up slack, pay less attention to own jobs, become demotivated; also
means scarce management time is diverted away from business
G
cannot plan or grow
eg London-based real estate finance and development firm was gearing up for a major
reconstruction job in Berlin, worth Euros 500m in revenues over two years as well as
opportunity to get in on the ground floor of other projects in region; but when executive
committee reviewed list of people who might be ready to take on assignment, CEO
noticed that same names appeared as only candidates for other critical projects; firm’s
growth strategy hinged on a few, key projects but no one had groomed the people to
lead them
2
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Chapter 2
... BUT THE BATTLEGROUND IS NEW
The world around us
Managers may still be grappling with the importance of talent in the business mix but
meanwhile the earth is shifting beneath their feet. The workforce is changing fast and
changing radically, spelling further trouble for organisations that do not get to grips with the
ever tightening market for talent.
Key trends that are dramatically changing the landscape for talent:
G
a demographic time bomb
characterised in the developed world by falling birth rates, rising rates of retirement; OECD:
the early retirement of baby boomers from workforce, at its highest point, will result in a
combined reduction in the working age population of member nations of 65m people; in the
US alone there will be 10m more jobs than workers by 2010; industries such as banking,
insurance, energy and functions such as IT, R&D are already facing shortages
G
Richard Mott, CEO, Kyphon:
unlike leaders of many Silicon
Valley start-ups, Mott has no
plan to be acquired by big player,
cash out; instead aims to pursue
the ‘limitless’ growth opportunities
open to firm but believes he can
do it only if he can put people with
right skills in right jobs,
so he:
G
devised strategy, articulated
vision: which would attract,
develop the best leadership
talent, encourage leaders to stay
for long haul
G
hired an HR expert: from
admired firm, GE
G
instituted company-wide
talent review: looking for talent
gaps, development needs
G
devised flexible, open-ended
approach to employee
development: which has
become highlight of culture; firm
values almost any type of
learning - from scientific training
to lifestyle management, staff
can pursue knowledge in any
format that suits them, inside or
out, formal or informal; support
for learning extends to
employees’ families through a
dependent education
reimbursement programme; in
2006, firm spent $4,075 per
employee on training, up from
$3,200 the year before
a skills time bomb
because although emerging markets are producing a surplus of young talent at a time
when the West is in deficit, capitalising on this talent won’t be as easy as some companies
think; it’s estimated, for example, that France, Germany, which produce just 33,000
engineers, need closer to 100,000; Brazil, India, China produce about 900,000 engineers
pa; but in China only 10% of new engineers speak English while early adventurers into
India, Brazil report a dramatic variation in quality of engineering degrees, and graduates in
both countries; in addition, firms report that cultural barriers, eg a lack of teamworking
experience, reluctance to take initiative, assume leadership roles, are difficult to overcome
G
LEADING FROM THE FRONT
an attitudinal sea-change
as the mores of Baby Boomers are pushed aside in favour of those of Generation Y;
shaped by eg the Internet, information overload, workaholic parents, people born after
1980 are demanding greater flexibility, more meaning at work, more professional freedom,
higher rewards, better work/life balance than older employees; makes them harder to
manage than predecessors, and harder to hold onto; Boston Consulting Group: one third
of all execs today are loyal to their careers, not their companies; employees now in 40s will
have worked for between three and six companies during their careers; the generation
behind them, for 12 or more
The world within
Outcome: appoints more than
three quarters of firm’s sales
managers from its ranks; firm has
plenty of the talent it needs to
keep up pace of growth.
Meanwhile, inside organisations, outdated attitudes and practices to talent management help
explain why so many companies are fighting a losing battle:
G
talent is dismissed as a short-term tactical problem
rather than seen as integral part of long-term business strategy, requiring substantial
resources; typical example of short-termism: firm bringing new products to market
only hires additional sales, marketing people when it’s clear product will take off; means
little time can be spent on eg talent sourcing, career development; in addition, common
to find managers raising short-term earnings by cutting back on discretionary
expenditure on people development; creates vicious circle: lack of talent blocks corporate
growth; additional performance pressures are created; attention focused even more on
short-term
G
the focus is often on policy not people
when companies do make talent a priority, HR systems, processes become main focus;
problem? it diverts attention from place where most of obstacles lie: inside people’s heads
G
TALENT INVESTMENT
Many companies may still have
doubts about investing in people
but fund managers are coming
round to its value. Fund
management house Axa runs
special fund called ‘Axa Talents’;
the concept? to invest in
businesses that have the best
people, not the best balance sheet.
talent has no defender
few CEOs, senior managers spend regular quality time on talent issues or put much store
by the people they pay to think about talent; Saratoga Institute: less than two thirds of all
HR directors report directly to CEO; recent UK salary surveys show that senior sales,
finance, marketing, IT managers earn up to 50% more than HR counterparts; result? like
talent in any other function, talented HR people migrate to companies where they can use
their skills; means weak companies get weaker, strong get stronger
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3
DEFINING TALENT
COOKING UP SOME TALENT
Gordon Ramsay Holdings:
celebrity chef now employs 900
people in company which has 9
restaurants in London, new
openings in Florida, New York,
consultancies in Dubai, Tokyo,
has plans for more outlet
openings in US, Europe; the
business challenge: to keep up
with breakneck expansion while
still preserving, improving on
reputation for world-class cuisine;
means finding, retaining best
talent; so firm has:
G
G
G
identified the talent that is
key to its success: by playing
crucial role in creative direction
of restaurants, working closely
with staff, Ramsay has
opportunity to spot, nurture the
talent that drives his business
more than any other - creative
cooking skills of his chefs
maintained an inclusive
approach: the creative talent
gets eg more of Ramsay’s time,
tuition as well as paid
sabbaticals working in
prestigious restaurants all over
the world; but formal training is
offered to all staff so the most
talented know they can
progress quickly through
company
focused on development not
recruitment: ensures continuity
of service is maintained, high
standards preserved; all staff
work in same Gordon Ramsay
way; also means firm has
bucked tight labour market in
highly-skilled chefs
FISHING IN A TALENT POOL
Cargill: an international provider
of food, agricultural, risk
management products, services
with annual sales of $60bn,
employing 149,000 employees in
63 countries; its key challenges:
to grab its fair share of global
business growth coming
especially out of markets such as
Eastern Europe, China, Asia; to
get the right people in the right
places in the next five years; so
firm has organised talent analysis
into three pools
4
G
‘Next Generation Leaders’: ie
people who could potentially
run a major function, business
G
‘Emerging Leaders’: ie people
who could run a business
function, become General
Manager
G
‘High Impact Performers’: ie
people whose departure would
significantly slow the business
Chapter 3
Just what is talent? A broad definition from CIPD: Talent consists of those individuals who can
make a difference to organisational performance through their immediate contribution or, in
the longer term, by demonstrating the highest levels of potential.
The key points to note: talent is about ability to contribute now and potential to contribute in
the future.
But the precise definition of talent, the characteristics sought in talented people need to be:
G
organisation-specific: varying according to eg life stage of organisation, its strategy the talents demanded to steer young fast-growing company with international aspirations
through early entrepreneurial years are not the same as those needed to manage
established firm through period of consolidation
G
highly influenced by industry type: and nature of work, eg talent will mean very
different things in medical care than it does in financial services
G
dynamic: means definition is periodically revisited, reviewed in light of changing
organisational priorities
G
understood by everyone in organisation: because without shared understanding of
what talent organisation values, it’s impossible for eg managers to spot new talent, develop
people in line with business needs
Who are the talented?
Who should be classed as ‘talented’ is a tricky issue. For years, ‘talent’ has described only a
relatively small group of high-potential individuals in organisations. The rationale:
G
investing in ‘A’ players has bigger payback: estimated top performers produce
at least 100-150% more than average performers in similar job; top 20% is twice as
likely as average to improve productivity, sales; so makes sense to give this group
special attention
G
it’s a strategy with a strong clarity of purpose: because numbers are smaller,
population is well defined, organisations know exactly eg who they need to retain, who they
need to develop and for what sort of position
But the problem with this exclusive approach is, it:
G
can seem elitist: and stir up resentment especially in a Britain where education, class
system already stand accused of dividing people up into, ‘those who can’; ‘those who can’t’
G
alienates dependable ‘B’ players: ie the capable steady performers who form the
backbone of any organisation, provide the well-tended stage on which stars can perform
G
undermines social capital and performance: research - top talent is more effective
when it operates in vibrant internal networks with diverse range of employees, performance
suffers when social networks are absent or withdrawn, inclusiveness is compromised;
strong networks also play role in retention of fickle Generation Y who value community,
relationships at work more than older, achievement-focused Baby Boomers
And the best advice?
G
recognise talent, provide opportunities for development at all levels: because all
talent is valuable in a knowledge economy especially when demographic shifts threaten to
curtail an already limited supply; eg Aviva sums up its inclusive strategy on talent
management in tagline that describes workforce as ‘the vital many’
G
create different talent pools: so clarity of purpose is not lost; development is tailored to
meet specific needs of different, valued groups such as people with leadership potential;
talented specialists
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Chapter 4
MANAGING THE TALENT SUPPLY
Key task in talent management: to anticipate the future need for talent and set out a plan to
meet that need. In the past, firms responded to the challenge in one of two unsatisfactory
ways. It was either:
G
do nothing ... : ie make no guess at all about what skills might be needed where, when, in
what quantities; so strategy is reactive, relying overwhelmingly on outside hiring; worked in
’90s during period of mass lay-offs, but not now that market for talent is tight, hiring expensive
G
... or develop complex bureaucratic system for talent forecasting: the problem often too removed from business reality; becomes end in itself; eg the personnel director
putting finishing touches to complicated succession chart as plant management considered
possibility of wholesale redundancies; another weakness: difficult to forecast people numbers
correctly in today’s volatile, uncertain business environment, but inaccuracy is costly
Borrowed principles
TOPPLING OVER IN TALENT
Unilever: company’s Indian
operation faced problems when it
found itself with a top-heavy
management team at same time
as business declined in 2001
recession; firm’s well-oiled
leadership pipeline saddled it with
1,400 well-trained managers in
2004 - up 27% from 2000 despite fact that demand for
managers had fallen; result:
Unilever’s implicit promise to
avoid layoffs meant company had
to find places for the extra
managers in its international
operations or buy them out.
But now some companies are taking a brand new approach to talent management and
borrowing principles from supply chain management on the basis that:
G
estimating cheapest, fastest way to manufacture products is similar to getting cost-effective
way to develop talent; outsourcing aspects of manufacturing process is similar to hiring
outside; ensuring timely delivery is similar to planning for succession events
G
TO MAKE OR TO BUY?
the supply chain model is transferable: some similarities between the two processes:
it offers a way of dealing with uncertainty, volatility: in same way as supply chain
management eg eradicates need to stockpile components in warehouses, facilitates just-intime manufacturing, the same principles can facilitate just-in-time approach to talent
Questions to assess the trade-off
between hiring, nurturing talent:
G
How long will the talent be
needed? the longer it’s needed,
the easier it is to make internal
development costs pay
G
How accurate is ‘length of
time’ forecast? the less
certainty, the greater the cost of
internal development
G
How important is it to
maintain the organisation’s
current culture? especially as
at senior level, outside hires
introduce different norms,
values; if important to maintain
culture, development from
within is preferable
G
How do these answers
change for different
functions, jobs? eg lower level
jobs may be easily, cheaply
filled by outsiders, making costs
of underestimating demand for
talent small, but costs of
undershooting for more highly
skilled jobs will be much higher
The first transferable principle: make or buy - nurture or hire talent - to manage risk; so:
G
stay flexible, exploit advantages of both: deep bench of talent is expensive inventory
that can walk out of door; but developing talent internally is cheaper, less disruptive than
hiring; hiring though can be faster, more responsive to new demands than nurturing; trick is
to find right combination of the two rather than relying exclusively on one or the other
G
give up idea talent can be predicted with certainty: eg Dow Chemical, Capital One
abandoned long-term talent forecasts; moved to short-term simulations; managers give talent
planners best guess for talent demand over next few years, planners use simulation software
to estimate talent needed; process then repeated with different assumptions to test
robustness; means managers sometimes adjust business plans if need for talent is too great
G
err on side of caution with talent forecast: because although they are often treated as
if they were the same, the costs of over- or under-estimating talent needs are different; the
big costs come from overshooting since costs of retention generally outweigh costs of hire;
means eg a firm that needs 100 programmers in next few years may develop only 90
programmers internally, leaving the option to hire another 10 if the business requires them
Other transferable principles from managing the supply chain:
G
find ways to adapt to the uncertainty in talent demand: eg, create an organisationwide talent pool that can be allocated among business units as the need arises
G
improve ROI on developing employees: some firms ask employees to share the costs of
development by eg taking on additional stretch assignment on volunteer, own-time basis;
Deloitte pays costs of keeping accounting credentials up-to-date in case eg women on
career break want to return to firm; keeps ex-employees abreast of new developments so, if
they come back, they can hit the ground running
G
GETTING YOUR MONEY’S
WORTH
PNC Financial Services: offers
promising employees the
opportunity to volunteer for
projects working with leadership
team, sometimes restricting them
to their current functional area;
the deal - they get access to the
company’s leaders, a broadening
experience, good professional
contacts; but they pay for it with
their own valuable time.
preserve the investment by balancing employer-employee interests: eg McKinsey
allows associates to rank preferences for projects posted online but also allows principals
running projects to rank associates; final decision about allocation of talent resources made
by senior partner who tries to balance interests of business with staff development needs
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5
Chapter 5
FINDING TALENT
THE SIX EMPLOYEE
PREFERENCES FOR WORK
Concours Institute/Age Wave:
work plays one of six roles relating
to six different employee types:
Even the brightest spark is little more than a candlelight flicker if placed in the wrong
conditions. Finding real talent is more than about finding top skills. It’s also about finding
talented people who are a ‘good fit’ with the organisation - important if employers want to:
G
made up not of hired guns, but people who are energised, excited, committed to the work
they do, the firm they work for, can infect other staff, customers with their enthusiasm
1. EMPLOYEE TYPE: Expressive
Legacy
G
The role of work: about
creating something of lasting
value
G
What appeals, engages:
autonomy; entrepreneurial,
creative opportunities,
stimulating tasks enabling
continual learning, growth
G
The role of work: about
improving one’s lot in life;
finding a predictable path
G
What appeals, engages: fair,
predictable pay, benefits;
stability; structure and routine;
training
The secret to finding ‘right-fit’ talent:
G
The role of work: about being
valuable part of winning team
G
What appeals, engages:
collaboration; fun; stability,
structure; opportunity to gain
competence, to leverage
personal strengths
4. EMPLOYEE TYPE: Risk,
Reward
G
The role of work: about having
life filled with change,
excitement
G
What appeals, engages:
opportunity to improve
personal finances; flexibility;
choose tasks, positions from
long menu of options; openended tasks, approaches to
getting work done
don’t try to be all things to all people
research: looked at how companies with highly-engaged workforces achieved engagement;
found, surprisingly, that talent management practices varied widely; eg some firms paid
well above mean, others below; some offered highly flexible, self-directed work, in others
work was more structured; the thing though they all had in common? they excelled at
expressing what made their organisation unique; took care to celebrate their ‘uniqueness’,
took little notice of other companies’ best practices
G
understand employee work preferences
about the role work plays in a person’s life - what they value, love most about work, why
they work, the way they like to work; key point: in lives of affluent Westerners workers
overall care deeply about certain aspects of the employer/employee relationship but little
about the others; eg some people care deeply about social connections, friendships at
work; others value money, flexibility; the challenge: to find employees whose work
preferences, values chime with those of the organisation
3. EMPLOYEE TYPE: Individual
Expertise and Team Success
G
capitalise on their talent investment
because engaged employees are far less likely to ‘smash and grab’ development
opportunities, hawk their newly acquired skills to the next highest bidder that comes along
2. EMPLOYEE TYPE: Secure
Progress
G
create an engaged workforce
Find your signature
Tell new and prospective employees what it’s like to work at a company, articulate the values,
attributes that make the firm unique and you empower people who share your values, work
enthusiasms to self-select into your firm. But how?
G
pay attention to ‘signature’ experiences
ie the bundles of everyday routines, processes that tell a story about the firm, convey what
the overall employee experience at the company is like; these serve as powerful, constant
symbol of culture, values; make it tricky for competitors to imitate because they reflect
company’s particular heritage, ethos
COMPARE AND CONTRAST
5. EMPLOYEE TYPE: Flexible
Support
G
The role of work: it is source of
livelihood but not yet a priority
G
What appeals, engages:
flexibility; well defined vacation,
family benefits; well-defined
work routines; virtual,
asynchronous tasks,
assignments; fun
6. EMPLOYEE TYPE: Low
Obligation and Easy Income
6
G
The role of work: immediate
economic gain
G
What appeals, engages: jobs
that are easy to come by; well
defined work routines; lucrative
compensation; stability and
security; recognition
Highly engaged companies that have made recruitment a ‘signature’ experience,
increased their appeal to some recruits, not to others:
G
Wholefoods: collaboration, decentralisation are core company values so new recruits
told they will work with a team on a four week trial, team members will vote on whether
recruit stays or goes, profit sharing, bonus pay will be linked to group not individual
performance; finds lone wolves, individualists quickly rule themselves out
G
Trilogy Software: wants to attract people who love intense challenge, can tolerate
ambiguity, are prepared to jump right in so new recruits attend an organisational ‘boot
camp’ for three months in which top management, including CEO, oversees their every
step; recruits expected to eg participate in fast-paced creative projects in teams of 20
for first month; are then reshuffled into smaller ‘breakthrough’ teams charged with
inventing product, service ideas, creating business models, marketing plans; in third
month recruits have to demonstrate capacity for personal initiative undergoing rigorous
evaluation, feedback; not a place for the faint-hearted
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Chapter 5
FINDING TALENT cont’d
G
target a market segment
most firms can tell you who will buy their products; far fewer can say which job candidates
will buy into their culture, adapt to their workflow; the question: what sort of people would
be attracted to your firm? how can you reach them? eg Jet Blue: one of signature
experiences, part of organisational lore is revolutionary approach to flight reservations;
couldn’t afford to appeal to people who value earning high salaries in call centres so
devised system based entirely out of employees’ homes; went out to attract strong,
productive workforce who value flexible working, especially mothers with young children
G
How different companies get the
right people through the door:
G
Tesco: carves up careers
website into different sections;
each section uses design,
language, contains messages
designed to appeal to each
particular target audience
G
Toyota Manufacturing: even
for jobs on factory floor, runs 5
days of testing, interviews,
screening for values such as
teamwork, quality orientation
G
IKEA: selects applicants using
tools that focus on values,
cultural fit; standard
questionnaire largely ignores
skills, experience; instead
explores candidates values,
beliefs; becomes basis for
screening, interviewing, training
and development; when
employees apply for leadership
roles, assessment again relies
on personal, shared values to
ensure consistency
examine business needs
eg BP has particular appeal for talented people who are happy working collaboratively,
sharing learning with peers, but signature experience that encapsulates importance of both
to the firm, ‘peer assist’ was born out of need; firm had acquired five oil companies, needed
to create learning culture across its 120 business units to realise cost-benefit synergies; so
firm assigned business unit heads to peer groups representing up to 13 units, required
members to exchange ideas, share learning; to encourage knowledge sharing, business
unit leader’s bonus heavily linked to performance of whole peer group
G
RECRUITMENT TACTICS
identify and preserve company history
eg at Royal Bank of Scotland successive senior teams have continued custom, started in
18th century, of morning meetings; every day exec team meets between 8am-9am to talk
about previous day’s events, go over day’s agenda, commit to projects which are
conceived only in 30, 60 or 90 day time spans; meetings ensure bank is always thinking
about speed to market, conveys value bank places on action, speed, and eliminates people
who eg need caffeine injection, look at crossword before they can make decision
G
promote company stories
which encapsulate firm’s values; eg Goldman Sachs is happy to let circulate apocryphal
tale of MBA student who went through 60 interviews with firm before getting a job; reason:
it illustrates time, emphasis firm places on recruitment; every year, some 5,000 applicants
speak to average of 10 Goldman’s employees - the top 2,500 probably speak to nearer
30; firm invests more than 100,000 employee hours in conversation with prospective hires;
also gives candidates taste of networking, relationship-building activities they too will be
expected to take part in if they join firm
G
GONE FISHING
Organisations fishing in forgotten
seas:
G
Schlumberger: oil services
group has become one of
exploration, production industry’s
leading recruiters of women
engineers; introduced flexible
work practices to accommodate
mobility, other life cycle needs
G
IBM: by eg providing managers
with special training on recruiting
disabled workers, firm has
effectively leveraged skills of this
workforce segment - 42% of its
disabled workers have key skill
jobs such as software
engineering, marketing, IT
G
GE: taps into long-standing
experience, knowledge of older
managers who may have retired,
left firm, to help integrate newly
acquired businesses
G
Monsanto: has a ‘Resource
Re-entry Center’ that allows full
time employees who have left
company to reapply, after six
months, for part-time positions
G
BBC: advertises positions in
ethnic minority press, has
reserved half of the 90 places
on new mentoring programme
for ethnic minorities; another 18
for the disabled
make the message consistent
one of the most common causes of low engagement: employees’ perception that some
elements of work experience are not what they expected, what they were promised; eg
large industrial firm that decided to redesign orientation process because too many people
were leaving during, just after programme; but orientation was not the problem - it reflected
highly structured, tightly managed nature of organisation; problem occurred earlier in
recruitment: new recruits promised flexible work environment full of excitement, innovation,
freedom; firm either had to change pitch or change experience of working at firm
Baiting the line
And some further tips for organisations keen to attract the most able, committed employees:
G
cast the recruitment net into under-fished waters: because, like it or not, the supply
of 30-something white, middle-class male stereotypical managers is drying up fast; older
workers, professional mothers on career breaks, ethnic minorities, the disabled are all
segments of employment market which are under-exploited yet rich in talent
G
G
use the widest range of recruitment methods: as well as head-hunters, consultancies
etc, source talent by eg posting vacancies on the corporate as well as external jobs
websites; building links with key university departments, forging links with professional
bodies, networks; asking for employee, customer referrals, considering non-standard
employment contracts offering eg freelance, contract, interim work projects
raise the organisation’s profile: by eg writing articles in magazines; taking part in
‘competitions’ such as the Sunday Times’ Best Workplace
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7
Chapter 6
THE ORIGINS OF TALENT
LET’S PRETEND
A way to bring benefits of repeat
deliberate practice into workplace
- simulated training:
G
G
radiologists: young radiologists
learn skills of interpreting X-rays
by working alongside ‘experts’;
but hospitals found that as
experts were only able to
correctly diagnose eg breast
cancer from X-rays about 70%
of time, trainees were scoring
similar rate; then radiologists
got a chance to practice making
diagnostic judgements using Xrays from library of old verified
cases where they could
immediately determine their
accuracy; diagnosis rate rose
the military: uses war games
so officers can analyse trainees’
responses in simulated combat,
provide instant evaluation; mock
military operations found to
sharpen leadership skill, give
trainees chance to explore
uncharted areas
TEACH YOURSELF
What do we actually know about how the talented become talented? To what extent are
outstanding leaders, marketing, IT or finance wizards born or bred?
Some insights from the world of psychology: in several studies of elite performers in fields
ranging from music and arts to maths, neurology, scientists find that top talent:
G
people that could predict their success
G
is not correlated to IQ: even in fields such as chess, medicine
G
is always made: and not born
The transferable lesson: if you want people to achieve top performance in leadership, R&D or
marketing, forget the folklore about genius, and acknowledge the role of hard work, support.
When practice makes perfect
The journey to truly superior performance is not for the faint-hearted nor the impatient. What
makes experts expert is a commitment to ‘deliberate’ practice. Underpinning ideas:
G
G
G
GOLFER’S EXERCISE
To illustrate the importance of practising what you do not know: imagine someone is
learning golf for the first time; early on they learn basic strokes, they try to avoid big
mistakes, eg driving ball into another player; they practice on putting green, hit balls at
driving range, play rounds with other novices; in short time, their game improves; with
further practice their strokes become automatic, they play more from intuition; but beyond
this point, additional practice does not result in substantially improved performance; why?
because when they play a game, they only get single chance to make a shot from any
given location; they don’t learn how to correct mistakes; so how do expert golfers
improve their skill? they practice every failed shot five or 10 times from exactly the same
location, get feedback on their technique.
Winston Churchill: improved
oratory skills by practicing
frequently in front of mirror,
changing body language as well
as voice
G
performance is consistently
superior to expert’s peers
G
real expertise produces real
results: not how they do it but
results they get that counts
G
8
true expertise can be replicated,
measured
practice must involve ‘deliberate’ thought
how elite performers think is as important as what they do: faced with a problem,
challenge, they think through all possibilities for their next move; assess the consequences
of each, plan a course of action; but critically, if the plan does not work out, they go back to
prior analysis, identify where they went wrong, work out how to avoid future errors; practice
further to eliminate their weaknesses
WHAT IS AN EXPERT?
G
experts focus on what they cannot do
it’s only when people focus on their mistakes, what they cannot do well or even at all that
they can become experts
Benjamin Franklin: wanted to
learn to write eloquently,
persuasively so began studying
The Spectator; after reading
article he liked, he would then
try to reconstruct it from
memory in own words;
compared his version to the
original so could identify, correct
faults; also improved sense of
language by translating articles
into rhyming verse, then from
verse back into prose
Not all experts are expert; eg in
blind wine tasting tests, experts
were no more accurate in
distinguishing wines than others;
experienced psychotherapists no
more successful in treating
random patients than novices; the
mark of a real expert:
not all practice makes perfect
contrary to popular belief, practising for years does not lead to expertise in the same way
living in cave does not make a geologist; expertise comes from particular kind of practice
Examples of self-coaching:
G
cannot be forecast: there are no consistent early indicators in background of talented
G
practice must be guided by an expert coach, mentor
who is right for each level of development; coaches make a difference because they:
O
accelerate the learning process: by sharing their knowledge
O
keep practice going: by motivating the tutee when practice gets dull, hard, boring
O
identify correct practice level: so task is not so hard that tutee becomes frustrated, is
tempted to give up, nor so easy they are no longer challenged
And the ultimate aim? For the talented to become increasingly independent of the coach so, in
time, the expert is able to coach themselves.
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Chapter 7
STRATEGIES TO NURTURE TALENT
So how do these findings translate into the business world? In the most successful
organisations, the process for developing expert leaders, technical specialists, knowledge
workers is surprisingly similar to that used to grow elite performers in other fields. Key features:
G
line managers play major role as expert coaches
in the learning, development of the talented; means line managers eg provide on-the-job
training for hard skills, coaching, role-modelling for soft behavioural skills; recognise
importance of motivation, support; know eg when to release talent to the next teacher,
where new opportunities are arising
G
... and allowed to make mistakes, take risks
eg Kraft manager running cheese unit early in career, faced threat from private label
brands who were stealing significant market share; manager had freedom to decide what
to do, do it quickly; so gave promotional incentives to retailers, assuming they’d pass
saving on to customers in lower prices; but retailers kept cash; so manager changed
course, reduced list price of products, provided cuts directly to consumer; manager later
went on to be top executive; why? his mistake was justifiable, he’d spotted it quickly, he
rectified it as soon as he could
G
there are opportunities for simulated training
so the talented can practice skills repeatedly; eg cereal maker General Mills runs a three
day programme of simulated training in which employees can prepare for situations that
might occur on typical day; groups of 30+ go to HQ, divide into teams to compete in
challenge that replicates normal business problems; also way to spot undiscovered talent;
eg the R&D manager who demonstrated an acute skill for marketing
G
G
90% of UK employers say line
managers are important in
supporting learning; but they
think only 12% of managers
take the job very seriously, 44%
are ineffective
G
two-thirds of UK organisations
provide coaching training only
to a small minority of managers,
15% of organisations give
managers no coaching training
at all
people are pushed out of their comfort zones ...
and encouraged to cross divisional, sectorial, functional and geographical boundaries to
acquire new skills, perspectives, focus on what they cannot do, eg Canadian Tire says
managing unfamiliar territory forces execs to learn new skills, not always rely on core
strengths; so took CFO out of financial services division, put in charge of retail banking
pilot; also moved its retail vice president of home products to president of petroleum
division; meant results-focused CFO discovered an ability to inspire, direct large team;
retail VP had opportunity to build strategy for entire stand-alone small business unit, learnt
how to engage frontline employees
G
...
CIPD: Learning and Development
Survey 2007 looked at the role of
line managers and found
high performance standards permeate the organisation
through effective use of performance appraisal; means talented are constantly set
challenging but achievable goals, receive frequent critical but constructive feedback, are
engaged in ongoing dialogue with manager to ensure progress is on course, blocks are
identified, eliminated early
G
ARE YOU SERIOUS?
reflection is valued, encouraged
...
WE ARE
IBM: invests more than $700m a
year to develop knowledge,
experience of workforce;
employees spend 16m hours a
year, 50 hours per employee in
formal training online or in
classroom; company also runs
high potential leadership
programmes in-house and in
association with world’s leading
business schools; all managers
trained in how to promote
learning and development of
direct reports.
MENTORING REWARDS
Nokia: executive board members
meet five or five times with
protégés, mentees at vice
president, director level during six
months period; the pair identify
learning, the mentee then applies
lessons they learn to plans for
personal development; Nokia’s
top 200 execs are evaluated on
how strong subordinates rate
their ability to teach, inspire.
as critical part of learning process; the link between the two: it is the meaning, drawn from
reflection, that results in learning
A WORLD OF POSSIBILITES
DIARY OF REFLECTION
To encourage reflection Polaroid:
G
G
Procter & Gamble: to ensure
talent moves freely around the
organisation, firm runs
G
open job posting system:
employees can post profile to
system, managers can search
from available candidates
interested in any particular
posting
G
internal talent marketplace:
extension of above system; also
records info on an employee’s
eg, salary, experience,
performance rating; market
monitored by HR to ensure
no price-driven bidding war
for talent
gives managers a ‘reflection workbook’: contains learning journal, learning log, plus
advice on how to use them; users are actively encouraged to record random thoughts,
identify the learning that occurs through work experience; used independently or with
one other person acting as learning coach
organises ‘communities of reflection’: in which small groups get together to
reflect, share learning with others; result: managers say they’re now able to surface
personal learning that they otherwise would not recognise, say group reflection instils
sense of fellowship, trust, gives group opportunity to slow down, think about project
decisions, outcomes
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9
NURTURING LEADERSHIP TALENT
RECRUITMENT FAILURES
G
G
G
Amazon: recruited Joe Galli as
first COO from Black & Decker
to inject old economy discipline
into new economy upstart; Galli
quickly cut costs, brought
operations staff into line with
B&D’s customer service,
fulfilment orientation; but
Amazon’s success was built on
technical prowess; shifting its
model from erecting barriers to
entry via innovation to attracting,
retaining customers was
fundamental, and effort failed;
Galli’s tenure lasted little over
a year
Fiat: Paolo Fresco headhunted
after spearheading GE’s growth
into Europe; he eg invested in
technology, built web presence,
diversified through acquisition;
but weak cost control edged
firm into long-term liquidity
crisis; solution? a politically
explosive plan to divest core car
business; when idea rejected by
creditors, shareholders, Fresco
resigned
Investment Analysts: in study
of performance of newly
recruited star investment
analysts, 46% did poorly in year
after they left old firm - on
average performance dropped
by 20%; even after five years
performance had still not
climbed back to previous levels
In a recent survey, CEOs of global firms declared organisations have less management
strength now than at any time in living memory. And their typical response? Grab a fat cheque
book, reach for a cloak and dagger and join the cut-throat world of star-hunting.
Hiring in the external market is sometimes necessary, even advantageous, but the problem
with hiring as a strategy for plugging talent shortages is that:
G
G
G
O
takes years to recapture: with some high-flyers never returning to their previous levels
of high performance
lack business relevance
focus too heavily on individuals
aim is to develop ideal candidates, star performers who will single-handedly improve
company fortunes; but this has several dysfunctional side-effects including:
when CEO eg, visited another
firm to see how it monitored
emerging leaders’ progress, he
returned to office, cleared out
entire conference room,
plastered photos of Tyson’s
rising stars with descriptions of
job experiences, educational
backgrounds, SWOTs
But although efforts were popular,
by 2002, firm was still not
producing enough quality leaders.
is more comet than star: ie early success at new organisation is quickly followed by
sharp performance dip
it’s common to find different companies in widely different industry sectors offering broadly
same, formulaic preparation for leadership; partly a product of mindless mimicry,
benchmarking of top performers, slavish devotion to newest fads; eg the US firm that
revised leadership training programme approx every two years based on ideas of most
recent best-selling management books:
every time CEO, senior
manager read article, heard
about initiative, eg mentoring,
the firm got in on act; eg the
Tyson Mentor Programme
when CEO read about power of
retreats, he personally approved
budget to send high potentials
to Rio Grande ranch to tackle
challenges facing firm
O
But if hiring fails to solve talent shortages, in-house nurturing has proved equally unsatisfactory,
even in cases where there has been a significant investment of time and money. And the
reasons why leadership development initiatives frequently fail? They:
Tyson Foods - The story, pt 1:
leadership development followed
similar desperate course for
several years; eg
G
talent is rarely transferable: research - even gifted managers, trained in the most
admired companies, frequently fail to make good CEOs when they move jobs; same
applies to ‘bought in’ stars in eg IT, law, banking, advertising; when high flyers change
employers, common to find their performance:
Mimicking the leaders
IT’S THE FASHION
G
it only works in the short-term: catch a real star and it won’t be long before the next
hunter is on the prowl; pass over the heads of stars in the ascendancy and it won’t be long
before they too are heading for the door
G
G
G
O
a bland model of leadership: because only way many firms have of assessing
individuals’ development needs is generic set of leadership competences; means nearly
every firm is trying to develop same identikit leader with eg vision, direction, energy
O
powerful self-interested leaders: whose personal reputation may end up overpowering
that of organisation; means employees often become more dedicated to individual
rather than firm; firm becomes beholden to charismatic individuals, suffers major
disruption when they leave; charisma, personal ambition rather than character, ethics,
values are seen as hallmarks of the good leader
O
unhealthy competition for talent: in which business unit heads compete for, jealously
guard best talent, focusing on own interests rather than those of organisation; for
talented, ‘silo thinking’ may mean opportunities to grow elsewhere in organisation are
lost, be the main reason why they look for another job
measure the wrong thing
effectiveness of development efforts is assessed by output not outcome; eg large industrial
firm with history of technical, financial excellence, an analytical culture, tracked the number
of leaders trained at below target unit costs, using firm’s e-learning technologies; metrics
met with CEO approval but gave no answers to questions such as, ‘Are we better able to
fill jobs; are managers more committed to our strategy?’
G
over-leverage the talent base
talented but inexperienced managers are pushed into jobs that stretch too far
10
Chapter 8
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Chapter 8
NURTURING LEADERSHIP TALENT cont’d
Leaders of distinction
What do we know about the leadership development approach of organisations that
consistently produce leaders who are a cut above the rest? They:
G
go their own way, forge their own distinctive path
because they know that if they blindly follow the pack, the best they can hope for is perfect
imitation; so they decide what particular kind of leaders the business needs, tailor
development accordingly; means that although these organisations produce able leaders,
they produce very different leaders: one reason why leaders produced by one top
performer may not ‘export’ well to other businesses, sectors
G
focus on what stakeholders want
LEADERSHIP BY DESIGN
Tyson Foods - The story, pt 2:
failure of ad hoc, fashion-driven
approach ended, leader pipeline
unclogged when CEO went back
to basics and:
G
formed senior task force to
examine challenges business
faced, what kind of leader
needed to meet them
G
key change: business now holds
6-month strategic reviews to
look at business, stock of talent;
business, division, functional
heads now held personally
accountable for rotating
emerging leaders throughout
business; care taken to ensure
that newcomers are given time
to grow, not compared to
experienced predecessors at
point of their departure instead
of acquiring major experience,
knowledge of just part; division
heads forced to ‘share’ talent
means leadership development starts not with competence list replicating qualities of
organisation’s star performers, what senior managers think young turks should learn;
instead they clarify what customers, investors expect from them; work to connect
expectations of market with behaviour of company leaders, staff
G
make a distinction between leadership and leaders
so focus is not on individuals but on methods, processes that secure long term health,
leadership capability of firm
More specifically, these firms:
G
nail the four fundamentals of leadership: so leaders have the basic tools to be
effective, means high potentials all learn to:
1 think strategically: ie have point of view about future, ability to position firm for
continued success with customers
WHAT OUR LEADERS ARE
KNOWN FOR
G
Procter & Gamble: developing
consumer insights, precisely
targeted marketing, product
innovation
G
Boeing: solving global
problems, working in teams,
technical excellence
G
Fedex: managing logistics,
meeting deadlines, solving
problems quickly
G
Lexus: running quality
processes, for continuous
improvement
2 execute: ie build organisational systems that work, deliver results, make change
happen
3 manage talent: ie know how to motivate, engage, communicate with employees, groom
them for tomorrow’s leadership posts
4 develop personal proficiency: eg the ability to learn, act with integrity, exercise social,
emotional intelligence, make bold decisions, engender trust
G
ensure skills in all four fundamentals are developed equally
common mistake: to allow leaders with exceptional ability in, say, strategy to concentrate
on this area to exclusion of others; makes for superb strategist not superb leader; best
firms ensure high potentials develop all four leadership skills in tandem
G
link leadership development to reputation they want to create with customers
so customer expectations are translated into mission-type leadership statement that:
O
is unique in content: eg at WalMart what customers expect are low prices so develops
leaders who manage costs efficiently, can drive hard bargain, get things done on time;
at Apple what customers expect are innovations, top design so firm develops leaders
with skills to create ground-breaking products, services that smash industry norms
O
integrates business, customer goals: with leadership skills
Other ways they keep leadership development linked to business, stakeholder needs - they:
G
ask customers to assess leaders
rather than just taking feedback internally
G
involve customers
invite customers to participate in leader training
G
A LEADING STATEMENT
Teva: an example of a leadership
statement integrating business
and leadership goals, written after
the Israeli pharmaceuticals firm
talked to customers, established
the kind of reputation it wanted to
develop:
“Teva leaders set ambitious goals
based on excellence in execution,
have a global mindset, master
complexity and embody team
leadership so that Teva retains
the most talented employees,
doubles sales every five years
and provides a broad basket of
qualitative products that
customers trust.”
give assignments which develop a customer lens
by insisting eg, finance specialists spend time in line management role
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11
NURTURING KNOWLEDGE WORKERS
CLEVERNESS AND SUCCESS
Conventional wisdom has it that
intelligence, ‘giftedness’ are the
key to progress at work. Not so.
Being smart:
G
G
G
throws open doors but does
not lower ladders: ie mental
ability gets people into jobs but
has little impact on progress
has no effect on ‘intrinsic’
career success: ie on how
smart people view themselves
using own criteria; smart people
are just as likely to be unhappy
with their careers as others
impacts little on performance:
large-scale research: finds a
mere 25% of difference in
employees’ job performance, a
third of the difference in
students’ average grades can be
attributed to IQ; creativity, luck
and, above all, personality make
up the other 75%; key features
of the successful? they are
conscientious, industrious,
orderly strivers for achievement
Knowledge workers are the clever employees who produce a disproportionately large share of
high-margin, added value products, services for organisations. This breed takes in eg the
agency creatives who design new ad campaigns; the technocrats who build new engines,
computer parts; the intellectuals who advance human understanding of the scientific, social,
cultural worlds; the professionals who advise on the law, restructure company finances.
What makes nurturing this type of talent different from nurturing other talent groups is that
they tend to be:
G
Boredom: mostly likely to afflict
high achievers during period
between conquering novel
demands of current position and
before next challenge begins;
Signs: they lose bearings,
question their purpose, become
confused, suffer inner turmoil, lose
energy, become vulnerable to
distractions, engage in self
destructive behaviour, seem
distracted; Action: best defence is
early intervention; prepare them
for next move before they hit a
performance plateau; if they’ve
lost direction, get them to work
with coach, use exercises to rediscover what’s important to them.
Perfectionism: becomes
pernicious when anxiety to
perform results in procrastination,
paralysis, stress; Signs: they
believe what people achieve is
more important than who they are;
they stop trying new things for
fear they can’t do it well; they feel
guilty they have not achieved
enough; Action: help them
reframe how they think about
mistakes: failure is price paid for
trying something new, for testing,
developing resilience; review
goals: are they realistic?;
recognise their achievements.
12
iconoclasts
a universal, defining characteristic of clever people: they do not want to be, often resent
being, led; means psychological relationship between leader, employee is different
G
high maintenance individuals
who can be more passionate, egotistical, emotional, defensive than average, means there
is always the potential for ‘diseconomies’ of scale because, eg doubling the number of
creative people in a business does not make it twice as creative; the challenge: to inspire,
motivate, encourage them to give of their best
Understanding the breed
Other things to understand about clever knowledge workers - they:
G
need you as much as you need them: in that, without an organisation, few can
achieve what they want to achieve, can find the systems, resources, facilities, discipline to
ensure talent converts into a deliverable, ideas reach reality; eg the brilliant scientist whose
research needs funding, the facilities of a world-class lab; means power in relationship is
not totally one-sided, managers do have bargaining chips
THE TROUBLE WITH
CLEVERNESS
Where clever people trip up, how
to recognise the signs, what to do
about it:
Chapter 9
G
are scornful of hierarchy: and the usual trappings, inducements which signal corporate
success; means eg fancy titles, flashy cars don’t hold same sway, job promotions often
treated with indifference even contempt
G
seek peer approval: because it’s not that status does not matter to them; it’s just that the
status they seek, the approval they value, their sense of self comes from their professional
colleagues, the professional community outside their organisation, not from managers; so
eg, the researcher who claims he does not know his job title, will still insist on being
addressed as ‘Doctor’ or ‘Professor’
G
hate management speak, corporate effusiveness: the buzzwords, high-energy,
showbiz razzmatazz, that works well for motivating, celebrating with eg sales people, is
likely to be greeted with cynicism, viewed as patronising by these workers; eg Electronic
Arts which employs 7,200 people in developing interactive entertainment software, games
such as The Sims, FIFA Soccer, has found that relationships with its people have suffered
when the approach has been too ‘rah-rah’, lacking in content; now aims for straightforward
dialogue which shows respect for workers’ intellectual capabilities
G
like to hear, to see but not be seen or heard: ie they want to know what is going on
but hate the idea of becoming a ‘company man’, a political animal
IN THE KNOW
Major News Organisation: chairman has globally famous journalist on staff who, like
newsroom colleagues, is deeply suspicious of everything ‘the suits’ do; but although
journalist publicly expresses disdain for business side, privately he often asks chairman
astute, penetrating questions about organisation’s leadership, growth prospects,
customer relationships; he is also outspoken champion of organisation in dealings with
politicians, other media; chairman knows never to invite this employee to eg, strategy
meeting with ‘suits’ but he also knows it pay to keep him informed of all the major
developments in the organisation.
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Chapter 9
NURTURING KNOWLEDGE WORKERS cont’d
Protection and reward
Knowledge workers often see an organisation’s administrative machinery as a distraction from
their important, value-adding work. So create the space for their talent to blossom by:
G
shielding them from rules, politics
means eg freeing the star professor from burden of departmental administration, allowing
the investigative reporter to miss editorial meetings, filtering requests for information from
head office to allow consumer profiler the freedom to experiment with new marketing plan
G
simplifying the rules, getting buy-in
PHARMA POLITICS
Genentech: in the hugely
expensive, knowledge-intensive
business of drug development,
decisions about eg which drugs
go the distance can be highly
political; so to protect his
scientists, express his support;
the CEO:
G
inures them from market
pressures: eg in 2002, when
the drug Avastin failed in Phase
3 trials, company’s share price
fell 10% but CEO did not pull
the plug; in 2005 the drug had
sales of $1.13bn
G
lets his clever people decide:
which drugs will survive; means
once or twice a year, research
scientists defend their work to
firm’s Research Review
Committee, a group of 13
PhDs, who decide how to
allocate research budget,
whether to terminate projects;
leads to rigorous debate among
scientists over the science, the
direction of research; as well as
providing stimulating forum;
Committee also insulates CEO
from accusations of favouritism,
short-termism
G
does not punish failure: if
Committee decides to kill
project, researchers are kept
on, asked what they want to
work on next
eg Greg Dyke, ex-Director-General, BBC: on appointment, discovered mass of
bureaucratic, often contradictory, rules which often rendered organisation paralysed,
alienated staff; so launched irreverent ‘cut the crap’ programme to liberate creative energy,
expose those who blamed rules for own inadequacies; also engaged staff in campaign by
eg suggesting they pull out a yellow card whenever they encountered a dysfunctional rule
But it’s also important to keep the creative juices, the ideas streams flowing by:
G
encouraging diversity, debate
because what turns on clever people is new thought, challenging debate - and that is what
they get when they work in diverse organisations, in teams with people from different
backgrounds, cultures, perspectives, areas of expertise
G
accepting failure
eg Diageo: it took marketing team almost a dozen tries and a willingness to depart from
more obvious combinations, eg rum and coke, to create a the first really popular alcoholic
drink for younger consumers - the citrus-flavoured vodka, Smirnoff Ice
G
providing support in failure
failure represents a setback, personal disappointment for clever people who have put hard
work, long hours, ego into project; so give them time to ‘grieve’, extract the learning, then
provide the encouragement to find next challenge
G
encouraging ‘pet projects’
eg Google: reflecting entrepreneurial spirit of founders, employees can spend one day a
week on their own start-up ideas, called Googlettes; firm recognises payoff may come from
discovery of new ideas that can be applied in workplace or from new business ideas eg
Orkut, the Google-affiliated social networking website, began as a Googlette
And some extra tips for managerial survival:
G
... but never make them look a fool
eg past England football coach Glenn Hoddle lost respect when performed manoeuvre on
ball that star player, David Beckham, could not pull off; team saw it as public humiliation
of Beckham
G
Sir Richard Sykes: how the
former chair of GlaxoWellcome
managed staff:
G
when three of company’s hightech antibiotics all failed final
stages of clinical trial, he sent
letter of congratulations to team
leaders, thanking them for their
hard work, for killing the drugs;
encouraging them to think
about their next project for firm
G
to maintain credibility, respect,
remind staff of his scientific
background, he insisted on
being called, ‘Dr Sykes’
show them you are an expert too ...
clever people should feel independent, special but they also need to recognise their
interdependence, ie that you, others in organisation, can do things they can’t; eg marketing
director for big brewer knew little about real ales, production techniques, but earned
respect for grasp of firm’s sales performance by eg quoting how many barrels of beer had
been sold the previous day in given part of country, correctly reading market tastes,
predicting customers were ready for low alcohol beers
G
LIVING WITH FAILURE
use reverse psychology
Martin Sorrell’s (CEO, WPP) advice on leading creatives: ‘If you want them to turn right, tell
them to turn left’; push clever people and you generally end up driving them away; so aim
to be benevolent guardian rather than traditional boss
And the final tip: don’t ever expect any thanks from clever people. Remember they don’t
need to be led, right? So measure your success by your ability to remain on the fringes of
their radar, create the climate that allows them to dream up the next big idea.
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DIVERSE VALUE
Roche: diversity even drives big
decisions about corporate control,
M&A; eg sold off a 40% share in
Genentech, limits ownership of
Japanese pharmaceutical Chugai
to 51%; why? lets clever people
work in different cultures, pursue
own goals.
13
THE TALENT MANAGER
Chapter 10
Talking about talent
FEELING RECOGNISED
Do employees’ good days and
bad days, the emotional ups and
downs of working life have any
impact on performance? And if
so, what makes people feel good,
or bad at work?
Harvard Business School
tracking the day-to-day emotions
of nearly 300 knowledge workers,
and analysing 12,000 diary
entries over three years revealed:
G
G
G
G
G
emotions do affect
performance: when people are
having a good day, they are
more creative, more motivated
to succeed
the behaviour of managers
dramatically affects the way
employees feel: eg team
members working after hours to
meet tight deadline on
important project experienced
high levels of motivation after
high level exec unexpectedly
arrived with pizza, bottled water
for team; seemingly trivial event
caused people to perceive their
work, themselves as important,
valued; one person, who had
worked 15 hours straight, even
described day as one of best
she had had in months; result:
team got work done on time; its
high quality made immediate,
measurable contribution to
firm’s success
being able to make progress
at work is single most
important determinant of
positive emotions: means
people felt happiest, had their
best days when they achieved a
goal, accomplished a task,
solved a problem
praise without real progress
has little effect: on
performance and can even
arouse cynicism
good work progress without
recognition left people sad,
angry: and less likely to
perform later
Conclusion: the way to make
people feel better at work, raise
prospects of high performance is
for managers to create the
climate that helps people do their
best work, make them feel
recognised, valued for their
achievements.
The two most important skills to master in order to nurture talent: how to give feedback, how
to recognise people’s achievements. First, the tricky business of giving negative feedback.
Rule No 1, avoid these common errors:
G
the ‘I know best’ stance: never decide on causes, diagnosis of performance problem
before talking to employee; always hear them out first; you may not have the full picture
G
setting up win/lose situations: so your ‘discussion’ is really a battle of minds, wills
People are more willing to accept negative feedback if you:
G
make feedback goal-oriented not evaluative: so couch problem in terms of eg ‘Here’s
what I see is missing’, not ‘ Here’s what you are doing wrong’
G
ensure the feedback process is fair: so you can give solid evidence, examples of poor
performance; allow employee to explain matters, express opinions first; apply consistent
standards across team, confine criticism to performance, treat person with respect
G
are trusted, supportive: so employee believes you have good intentions towards them,
you listen to what they say, are eager to help them raise performance, go on to succeed
And more generally, feedback is effective when you:
G
emphasise free choice: so employee knows it’s up to them whether they are willing to
listen, take help; what you’re looking for is their ‘internal’ commitment
G
are as positive as possible: so suggest what’s possible given employee’s talents,
identify what they do that is working, point out one or two things to correct to make a
difference; you should leave them feeling inspired to do better not crushed, dispirited
High value recognition
Recognition is not the same as an incentive or a reward. It is:
G
a behaviour: it is not a ‘do this, get that’ thing, but ‘I saw you do x - thanks’; about what
you do, say, not about what you can give
G
higher in psychological value: and lasts longer in memory, has bigger ‘trophy value’ than
reward; reward, once acquired, also leads to expectation of more, bigger, better rewards
But recognition only has value if you:
G
are sincere: and express genuine appreciation, admiration for achievement of meaningful
goals, priority; going extra mile; puffery, praise for inconsequential or everyday tasks,
cheapens recognition
G
personalise it: in a way that suits individual employee; ask eg would team member prefer
private one-to-one expression of appreciation or if they are more extrovert, would they be
happier to bathe in the glory of public approbation and be recognised in front of team?
G
give it quickly: as soon as you spot behaviour, achievement you want to reward, reinforce
G
vary your approach: some ideas: a handwritten thank you card stating exactly what you
appreciate about way employee did job; ask employee’s advice on departmental issue; ask
them to deputise in your place at high-profile conference, company get-together; send
email to your boss recognising great performance and send copy to employee; get
employee tickets for show, game they would love to see
But remember recognition is only part of what it takes to build climate of support, respect.
14
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Chapter 10
THE TALENT MANAGER cont’d
Are you an able talent manager? Below are a series of statements. How strongly do you
agree with them? (4 = I strongly agree; 1 = I strongly disagree). The higher the score, the
more likely it is that, like Midas, you hold the secret for transforming lesser metals into gold.
ATTRACTING TALENT
G
I think about our talent needs constantly, and how these may change over the next 3-5
years
G
I recruit people from a wide range of diverse backgrounds and have ethnic minority,
disabled staff on my team, in my department, division
G
I know what makes my organisation attractive to new recruits; what makes us different
from our competitors
G
Our employees often refer friends, family for jobs in our organisation
SELF-SCORE
1
2
STRONGLY DISAGREE
3
4
STRONGLY AGREE
NURTURING TALENT
G
I am aware of the career aspirations of all my direct reports and what matters most to them
in their work and life in general
G
I spend a significant proportion of my time coaching staff, talking about performance
G
I help my staff set challenging but achievable goals which push them out of their comfort
zone
G
I encourage risk-taking and never chastise failure if the reason is plausible, understandable
G
I help my staff extract the learning from every development opportunity including failure
G
My staff would say that my relationship with them is one of mutual trust, respect
G
I have never blocked anyone from taking up an opportunity because I didn’t want to lose
them
G
My staff would say I give them the power, authority to get on with the job, make decisions
without consulting me
G
I give performance feedback on an ongoing basis and not just once or twice a year during
the appraisal process
G
My staff would say I have a positive effect on people, make them feel they achieve more
than they think they can
ROLE-MODELLING LEARNING AND DEVELOPMENT
G
I have clear personal development goals for the next year and strategies for how to
achieve them
G
I ask for feedback from staff, customers to assess how well I am doing my job
G
I never take constructive criticism personally
G
I can name several major risks I have taken in the last year
G
I make time for reflection to analyse what I am doing right, wrong
G
I act as a mentor to a more junior member of staff and have a mentor myself
G
I have lots of hobbies, interests which help me recharge my batteries, restore my energy
levels when I am tired, disappointed
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15
BULLETPOINT
FOCUS REPORTS
REFERENCES & FURTHER READING
The Art of Developing Leaders V Vishwanath & M Blenko Harvard Management Update November
2004
Building a Leadership Brand D Ulrich & N Smallwood Harvard Business Review July/August 2007
OTHER
REPORTS:
The Characteristics of Great Leader-Builder Companies D Ready Business Strategy Review
Autumn 2004
Curtain Call C Warren People Management March 23 2006
Developing Talent R Grossman HR Magazine January 2006
The Enthusiastic Employee: How Companies Profit by Giving Workers What They Want D Sirota,
L Mischkind & M Meltzer Wharton School Publishing 2006*
Global Talent Management: How to Sustain the Talent Pipeline INSEAD Faculty and Research
Working Paper 2007
How They Do It D Burke, C Hajim, J Elliott, J Mero & C Tkaczyk Fortune November 1 2007
Leader Machines G Colvin, T Demos, J Mero, J Elliott & J Yang Fortune November 1 2007
The Making of an Expert K Ericsson, M Prietula & E Cokely Harvard Business Review July/August
2007
G
Communication Skills
G
Appraising Performance
G
Motivating for Success
G
Building Employee
Initiative
G
Energising the
Workforce
G
Making Change Stick
Making Talent a Strategic Priority M Guthridge, A Komm & E Lawson McKinsey Quarterly January
2008
Next-Generation Talent Management: Insights on How Workforce Trends are Changing the Face
of Talent Management E Tucker, T Kao & N Verma Hewitt Associates White Paper 2006
Talent Management: Driver for Organizational Success N Lockwood HR Magazine June 2006
Talent Management for the 21st Century P Cappelli Harvard Business Review March 2008
Talent Management: Nurturing the Egg J Caye & I Marten Boston Consulting Group November 2007
Talent Wars: Out of Mind, Out of Practice R Gandossy & T Kao Human Resource Planning Vol 27
Issue 4 2004
BULLETPOINT
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What it Means to Work Here T Erickson & L Gratton Harvard Business Review March 2007
Work in Progress to Measure Management R Donkin Financial Times February 21 2008
* Indicates books
Nurturing Talent is published by Bulletpoint Communications Limited, Furness House, 53 Brighton Road, Redhill, Surrey
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Limited. All rights reserved. Reproduction in any form is unlawful. This publication reflects a synthesis of the references listed. Any
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Nurturing Knowledge
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The Talent Manager
References &
Further Reading
Ten years ago, a landmark McKinsey report warned companies they were entering
a war-zone for talent. Now a follow-up study finds that not only is war still raging,
but the fighting is about to intensify. CEOs, meanwhile, talk a lot about talent. But
‘jaw, jaw’ will never resolve this ‘war, war’.
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How companies can respond to increasing talent shortages is the subject of this
report. More specifically, it focuses on how companies can nurture their own talent
in a market where poaching is becoming an increasingly expensive and ineffective
strategy. The report begins with an examination of trends that are changing the
battleground for talent and moves on to look at what we mean by talent and how a
new approach, using ideas taken from supply chain management, is providing a
cost effective solution to managing the talent supply. It then considers:
G
how to attract the right talent: ie people who will fit in, engage with your culture
G
how talent is created: taking what psychologists know about elite performers in
other fields and applying those lessons to the world of business
G
the specific nurturing needs of leaders and knowledge workers: two very
special groups of employees that all organisations depend on for their success
Finally, the report finishes with a brief look at the key skills needed by every talent
manager and a questionnaire to help you assess your talent nurturing abilities.
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