When a business evolves through the five key stages of development, and its goal posts shift, it needs a unique talent composition at every step. However, managing that process takes much more planning and strategy than many realise.
As organisations grow, so too does their need to better manage talent, crafting the right mix of skills, experience and innovative thinking to bring the strategy to life. In an increasingly competitive, global world, they need a workforce with innovation, cross-functional business expertise and strong technical and analytical skills to thrive.
Many chief executive officers (CEOs) recognise this already – with the 2016 KPMG Global CEO Outlook revealing that they are delivering more aggressive strategies to manage talent.
However, the challenge is to get the composition spot on as the company changes. This takes awareness of the five key cycles of growth, the skills needed at each stage, and a talent acquisition strategy that stretches beyond a typical approach to hiring.
Toni Jones, Partner, Enterprise, KPMG, says the five stages of growth reflect shifts in the structure of the organisation and the role of its people. They are:
1. Startup – An informal structure, with the founder active in every area, running fast to generate revenue. While output is largely owner resourced, staff must be adaptable and able to work across multiple areas as necessary.
2. Build – The founder realises they can no longer be across everything. They need to identify the gaps, and hire the right people.
“Decisions on who to bring in can be challenging, as it means letting go of some aspects of the business,” Jones says.
3. Accelerate – It is time to speed up growth, reach new markets and focus on profit. More structure is implemented, new leaders are hired, and management is put in place for specialised areas.
“The managers look for more autonomy and ability to drive new ideas. The founder needs to recognise the value in stepping back further, and implement more formalised structures and measures to help monitor and manage the business with more people,” she says.
4. Sustain – Business is steady, usually with a head office and a decentralised workforce. It’s the moment to focus on performance and reward for staff.
“Key performance indicators and other governance controls are established to govern and track performance of a larger operation and roles,” Jones says.
5. Thrive – It is all systems go, with a team matrix, values and culture instilled, a focus on innovation, and the customer at the core. It is time to empower staff, advance skills and support leadership development. Succession planning and talent management become important.
“There is increased focus on wellbeing, diversity and motivating and engaging staff. Initiatives around company culture and ensuring diversity are important,” she says.
Jones says that these cycles are not necessarily linear, or aligned to the number of staff or revenue turnover.
“But they are valuable to consider in the context of the organisation’s current
situation and its objectives in terms of future growth and strategy,” Jones
It is important to keep reviewing the stage of the business and its resource needs regularly.
“You have to think about your talent as ‘serving a strategy’ and not as part of a transaction. You need to question why someone was doing a certain role in the first place, and whether that still works for where you want to go, or if their role needs to evolve.”
As challenges arise at each stage, specialised skill sets may be needed to implement solutions.
“For example, for technology issues, enterprises can’t rely on one person to know everything. They may need to bring outside information in, and utilise the intellectual property of experts in different fields,” Jones says.
However, it may be out of reach to afford more staff, or staff of the calibre needed for complex issues.
“You might need to hire 10 people to get a task done internally – but that's never going to happen for some enterprises. So how do you get that knowledge without investing in all those people?” Jones says.
An answer could be to consider more flexible hiring arrangements, with numbers you can increase and decrease as need demands.
“Think about how to tap into the knowledge of experts without spending an enormous amount of money,” she says.
Accessing flexible resource providers, tapping into the intel of advisory boards, or implementing retainers with specialised experts are ways to harness top-line talent while keeping cost down.
“It's about having the option to acquire interim resources and the expert advice you need at different stages of your growth strategy.”
It is also vital to have diversity of thinking and approaches in the workforce, so that fresh ideas evolve and the organisation is competitive. Jones says reverse mentoring (learning from people in different positions) can increase decision-makers’ understanding of their enterprise.
“Think about the differences in generations; the long-term board member may not know a lot about digital disruption, but the graduate doing financial analysis might be able to contribute a lot about social media or digital trends,” Jones says.
At every stage, particularly in Sustain and Thrive, enterprises must think about how they measure performance and offer reward, to keep people focused and engaged. People succeed better with clarity around their roles and accountability for tasks.
“You need to set goals that are aligned to the goals of the organisation. But you need to set them to the right level. If goals are too burdensome it becomes cumbersome and stifles growth.”