Developing people for future leadership positions is a pivotal element of talent management. But, such development is expensive. An article by Peter Cappelli published in the March issue of the Harvard Business Review suggests that organisations can err either by developing too many people for their eventual leadership requirements or by finding that the template against which people have been developed is overtaken by events. Cappelli advocates drawing a parallel between the supply of talent and supply chain management. His 'just in time' approach to talent management is centred on the following key ideas:
1. Oversupply is more expensive than undersupply so you should aim to develop-from-within the lowest likely number that will be needed. You then hire additional people from outside, as they are required.
2. Acquire talent in the smallest batches possible so that you can continually fine tune your requirements. For example bring in graduates half-yearly or quarterly rather than annually.
3. Rather than letting each division have its own talent pools and development programmes, with their resulting under- and over-supplies, aggregate the talent pool across the organisation so that errors cancel out.
4. Get employees to buy a share in their development - in terms of time or money.
Although there is some merit in these suggestions, they hardly represent a comprehensive approach to talent management. The problem is that the analogy between the physical objects of the supply chain and the subtleties of developing talented people does not really work. Of course, organisations need to plan the supply of emerging talent but this has to be done in a continual three-way dialogue between the needs of the business, the talent manager and the people being developed. People under development are not like widgets on a shelf, lying idle until their moment comes. They should be managed to make a maximum contribution throughout the time of their development.
The approach we advocate is to:
1. Clarify the requirements for the future and keep those requirements under constant review
We use the Indicators of Excellence approach to specify the key outputs you want to see from people in future roles. Indicators of Excellence encapsulate what the person needs to do to make a maximum contribution to their role.
2. Identify the people who are in the strongest position to develop the future role requirements.
Selection procedures should look for concrete evidence of the Indicators of Excellence. We strongly advocate looking for the best evidence of behaviour that is available. This will vary from the lengthy and repeated opportunity to demonstrate behaviour afforded to interns through to the day's opportunity of an assessment centre through to interviews and even references when they are appropriate.
3. Provide individualised development
You might put too many people on the journey to future roles than you will eventually need -- and the extra people might well leave. However, we would see this as arguably a lesser problem than developing too few people. Unlike Cappelli, we would not see development as wasted. It will have enhanced people's performance in their roles along the way, give clear messages about your commitment to people's growth and emphasised your intention to resource internally. Furthermore, if development is individualised you can hone development as people progress. You can also hone the business around the talent that becomes available.
For further information about the Human Assets approach to talent management, please contact Charles Woodruffe on +44(0)20 7434 2122 or email charles.woodruffe@humanassets.co.uk
Reference. Cappelli, Peter. Talent management for the twenty-first century. Harvard Business Review, March 2008, pps 74-81.