Talent War: Round Two

Talent War: Round Two

Western economies seem to be coming through the dark days of the three-year bear market. Stock prices are up around 30 per cent this year, and perhaps the first Talent War story for a long time was to be spotted in the Financial Times (14/10/03). The story reported that Lehman Brothers is offering its investment bankers in London and other financial centres a chance to earn up to £6,000 by referring potential recruits to the company. The bounty of £6,000, of course, merely brings about the introduction. The talent war will only be won if you address the constant need to ensure that you are working to meet the needs of talented people in order to attract and retain them.

The cost of not winning is obvious at a conceptual level. Lose the talent war and you lose the competitive war. A recent article by Garry Gelade and Mark Ivery from Lloyds TSB provided hard data to show the performance gain from progressive Human Resource Management (HRM) policies and practices aimed at retention. They compared clusters of Lloyds TSB branches. The different clusters were sufficiently autonomous to differ in their HRM practices and the researchers concentrated upon their staffing levels, working hours and professional development. They looked at the effects of these HRM practices on the performance of the clusters of branches.

Performance of the clusters was examined in terms of:

Retention
Clerical accuracy
Customer satisfaction
Sales performance

The findings make compelling reading. Many of the HRM practices are significantly related to the performance of the clusters. For example, sales are lower for branches that operate more overtime and higher for branches that engage in professional development. Customer satisfaction is higher for branches with a higher staffing level and for branches that engage in professional development. However, the highest relationship of all for customer satisfaction was its association with retention. Retaining staff is clearly shown to be associated with customer satisfaction. What better argument can there be for engaging in practices aimed at retention?

Probably none of this is a startling surprise to you. Nonetheless, we would urge you to ask whether you are able to do everything possible to retain staff with the huge impact on customer satisfaction and business performance that retention brings.

What can Human Assets do?
We can help you by auditing all the issues that attract and retain talented people and making recommendations for improvements.
Please contact our consultants at enquiries@humanassets.co.uk or by telephone +44(0)20 7434 2122.

Reference
Gelade,G.A., Ivery, M. (2003) 'The Impact of Human Resource Management and Work Climate on Organizational Performance.' Personnel Psychology: A Journal of Applied Research 56, 2, 383-404.