TALENT MANAGEMENT
Companies view talent as biggest obstacle to future growth
Concerns over an ability to attract and retain key talent, or to plan for an orderly replacement of talent, could thwart efforts by employers to position themselves for future growth, according to a survey by Towers Watson. The 700-company survey also found significant gaps in employers’ capabilities to address talent management and succession planning issues.
Respondents in Europe are particularly worried about the talent drain’s impact on management succession planning. Nearly half of respondents (48%) cited this in the “top three” most important challenges to growth, on a par with concern about the loss of talent in key skill areas. The other most concerning challenge cited in the “top three” was the level of disengagement amongst workers (stated by 39%).
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Joris Wonders, Senior Consultant, Talent and Rewards for Towers Watson, said: “Companies clearly see talent as an integral part of growing their businesses when the economic recovery firmly takes hold. And despite respondents’ cautious optimism about growth in the coming year, they recognise that an inability to attract new talent or hold on to key individuals could prove to be the difference between growing and remaining stagnant. In light of this concern it is striking that the research found that many respondents aren’t truly prepared to address talent issues.”
The relationship between a high-performance culture and growth, and the role that effective performance management plays in helping shape such a culture was recognised by respondents to the survey. As the report explains: “With talent worries looming large, there’s little doubt that getting the pay/performance equation right can deliver benefits across the board - giving companies the ability to keep top talent, have a sufficient pool to draw on for succession planning and have an easier time attracting the necessary talent.”
Other key survey findings
Of those companies surveyed, only a quarter (26%) indicated they have an appropriate capability in place for acquiring talent and fewer for succession planning (23%).
Only 22% of respondents have a sufficient capability for retaining talent.
A third (33%) of respondents from Europe said they would continue reducing staff or actually begin doing so for the first time.
There was also an emphasis on cost management and “evergreen” initiatives, such as more restrictive travel policies (58%), tighter bonus criteria (39%) and restructured career ladders (40%).
A final word
“The lack of a sufficient governance capability in talent management and succession planning is a real concern, particularly since the least prepared organisations will not only find themselves at a significant disadvantage over time, but may lose critical momentum in trying to catch up to more advanced peers once recovery is in full swing. One positive finding that may help offset this risk is respondents’ focus on improving performance management, which was cited as the number one area for greater emphasis this year globally.” - Joris Wonders, Senior Consultant, Talent and Rewards, Towers Watson.
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Title: Strategies for Growth, Towers Watson, January 2011.
Survey details: The survey was conducted in September 2010 and includes responses from executives at more than 700 companies worldwide. The participants represent a wide range of industries and are based in Asia Pacific, Europe, the Middle East, Africa, Latin America and North America.
Availability: For more details about the survey visit www.towerswatson.com/united-kingdom/contact/.
Towers Watson is a “leading global professional services company that helps organisations improve performance through effective people, risk and financial management”. With 14,000 associates around the world, it offers “solutions in the areas of employee benefits, talent management, rewards, and risk and capital management”. To find out more visit www.towerswatson.com.