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Companies must rethink strategy to compete in the global war for talent
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Research from advisory firm KPMG suggests that companies that focus on attracting and retaining high-potential employees may lack competitive advantage as the war for talent intensifies. According to a global survey of HR professionals conducted in spring 2014, addressing skills shortages is a higher priority than it was two years ago and employers are taking a more holistic approach to talent management in order to compete worldwide.
Robert Bolton, co-leader of KPMG’s Global HR Centre of Excellence and the lead author of the survey report, explained: “In 2001, the focus was on attracting and retaining high-potential and high-performing employees. It’s an approach that has become deeply ingrained for many companies. In 2014, however, 66 percent of respondents are telling us it’s much more important for organizations to have a holistic approach to talent management that addresses the needs of all employees as well as those in critical roles.”
Eighty percent of the 335 respondents from 47 countries surveyed by KPMG said that skill shortages appear likely to increase as globalization and competitive pressures take hold across sectors, and industries and improving economic conditions spur employees to seek new jobs.
Fifty-nine percent of respondents agreed that the competition for talent is different than in the past and as a result, feel that talent management strategies need to evolve. The study found that just over half of respondents agree or strongly agree that solely pursuing high-potential talent at the team’s expense puts the business at risk.
Respondents also stated that the most-often named root cause of skills shortages is generational. Younger skilled workers seem less interested in traditional roles and see themselves as free agents, while the scarcity of people with skills required for new emerging roles is perceived as the most critical market shortage.
Bolton said these findings are a wake-up call for HR managers, who “may still be clinging to old-fashioned approaches to talent management.” Addressing skill shortages throughout the entire organization, and not just at the most senior levels, should be a top priority in 2014, he said.
According to Bolton, there are a number of actions companies can take to give themselves an edge in filling their talent pipeline. Enlist management to support HR with talent management, and develop clear career paths for employees. “One thing many leading companies are doing is putting powerful new data analysis capabilities to work to help gauge their performance and fine-tune their people practices over time,” he said. “Nonfinancial benefits of the sort offered by effective HR functions are difficult to quantify. But new analysis technologies allow HR functions to evaluate and make evidence-based decisions that positively impact the business.”
KPMG further recommended that companies:
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