Building internal talent rather than “buying” it from external sources delivers a large competitive advantage because it enables organizations to fill talent gaps as they emerge, while also reducing costs related to recruitment, onboarding, and training.
“Most companies simply can't access the talent that they need when they need it through the broader labor market, so building your internal talent has become an essential strategy,” said Edie Goldberg, founder of E.L. Goldberg & Associates and author of The Inside Gig (LifeTree, 2020).
Internal talent mobility also boosts talent retention and employee engagement. Employees at companies that prioritize hiring from within stay 54% longer than employees at companies that don’t, according to recent data from LinkedIn. Despite these clear talent management benefits, only 1 in 3 organizations has a formal internal mobility solution, notes LinkedIn.
How then should organizations go about implementing an effective internal talent mobility solution, one that drives agility, talent retention, and cost reduction? Four HR leaders share their best practices.
1. Align Internal Mobility with Business Goals
To understand their talent needs, organizations should begin with their strategy and work backwards. “Start by looking at where the business is headed in the next year or two, and then ask what specific skills you'll need to take you there.” said Anat Keidar, chief people officer of DoorLoop, a property management software provider.
Once an organization has assessed its talent needs, it can build an internal skills inventory that aligns with its strategic goals. Internal talent mobility should be organized as a partnership between HR and the business.
“HR should own the infrastructure of the internal mobility program, including the frameworks, transparency mechanisms, and development pathways, but the strategy only works if business leaders co-own it along with HR,” Keidar said.
2. Focus on Change Management
While technology platforms (typically enabled by AI) are involved, implementing an internal talent mobility solution isn't just a technology implementation. Driving value requires connecting previously disconnected systems, programs, and approaches, as well as driving culture change across the organization.
“You have to build a business case,” Goldberg said. “Then you need to do an organizational readiness assessment to understand what parts of the organization it might work well in and where you might get pushback. You’ll have to define new ways of working and then align your HR systems and technology to support them.”
3. Build a Skills-Based Talent Framework
When organizations look at skills rather than job titles, they’re better able to identify who has what capabilities and also connect to skill adjacencies and transferable skills. AI can be essential here in matching internal skills to new opportunities, but so is human input.
“Automation and AI can help surface talent and reduce manual work, but leadership judgment still matters. The strongest programs will combine reliable data from a single-database software with human context to build a more agile workforce,” said Tiffany McGowen, senior executive vice president of HR and talent acquisition at Paycom. Doing that talent-to-opportunity matching well takes a nuanced analysis that blends quantitative and qualitative assessments.
4. Increase Transparency Around Career Opportunities
At too many organizations, opportunities are resourced by prioritizing who you know, rather than what you know. Goldberg refers to talent marketplaces as equal opportunity platforms. “They democratize opportunity and allow employees who’ve been previously ‘unseen’ to be seen for the skills they have,” Goldberg said.
Beyond looking at the external talent marketplace, you can also look internally to build your talent pipeline.
“Every time an opportunity opens, the recruiter and the hiring manager talk about whether there is someone in-house who is ready or close to ready. The goal is that no qualified internal candidate gets missed because nobody thought to ask,” Keidar said.
5. Invest in Manager and Employee Development
Talent should be “owned” by the organization, not individual managers. Managers who hoard talent are among the biggest obstacles to building an effective internal talent mobility program.
According to Maureen Flood, partner, people advisory services tax, Ernst & Young LLP, the mobility of internal talent shouldn’t be viewed as a loss to an individual manager or team.
“Instead, someone is getting an amazing opportunity for their career and helping the business grow as a whole. How do we measure managers on broader talent outcomes such as recognizing those who develop and export talent for the benefit of the organization,” Flood said.
Leadership and development initiatives support employees in building their readiness, while enabling organizations to see what skills are available (or soon will be).
“L&D turns internal mobility from a concept into a pipeline. Mentoring, coaching and upskilling help employees build on the knowledge they already have, while automated tools give leaders a clearer view of readiness and where development should happen next,” McGowen said.
6. Measure Success and Continuously Improve
How can you measure the effectiveness of an internal talent mobility solution? Goldberg explains that you can do an employee survey. “Ask people, ‘are managers developing their people and letting them move forward? Are people getting connected to opportunities and are projects getting completed?’”
Additionally, Goldberg notes that internal talent mobility fuels innovation by bringing people from different disciplines together. “You can look at how much cross-functional collaboration is happening within the organization.”
Other measurements to review include KPIs such as decrease of spend on contractors, reduced costs for recruiting, and positive impacts on employee engagement.
Building Future-Readiness
Investing in internal talent builds a more agile, future-ready organization that can tap into talent in a way that’s strategic, timely, and more cost-effective. For employees, building internal talent also creates a more resilient, engaged workforce that’s ready to pivot along with the business.
“It’s a winning talent strategy, no matter the industry,” Goldberg said. “Every company I’ve talked to that’s implemented an internal talent mobility solution can point to multiple KPIs showing it’s had significant payoffs.”
Chuck Leddy is a Boston-based freelance writer who focuses on the impact of emerging technologies on the future of work, the modern workplace, and employee engagement. He's also written about and for institutions of higher education, including Harvard, MIT, and Boston University.
Was this resource helpful?