There is a new war for talent, and this war is different than in the past.
In the fifteen or so years since The War for Talent1 changed how companies manage talent worldwide, HR approaches that overly focus on high performers have become deeply entrenched. Now, after the economic crisis, the war for talent appears to be back in full force – and companies that take a fresh look at their tactics stand to gain more competitive ground as a result.
In a recent global survey of Human Resources professionals undertaken by KPMG member firms worldwide, most respondents say that addressing skills shortages is a higher priority now than two years ago – and will become critical in the next two years.
Skill shortages appear likely to increase as globalization and competitive pressures take hold across sectors and industries and improving economic conditions spur employees to seek new jobs.
In KPMG’s survey, the majority of respondents agreed that there is a new war for talent, and this war is different than in the past. Respondents to the KPMG questionnaire also stated that the most-often named root cause of talent and skills shortages is generational:
There is little evidence that typical ‘war for talent’ practices that focus on high performers actually contribute to improved business performance. An analysis of the 106 original adopters of the ‘war for talent’ practices indicates that 15 years later such practices have not helped corporate survival and performance. Only 25 percent of the organizations can be said to be performing well in their market place. A third have disappeared entirely.2
KPMG’s HR professionals agree that it is time to turn to new, more holistic strategies for managing talent:
Survey respondents say the top three strategic approaches to addressing talent skills and shortages are as follows:
1. Enlist and empower management in talent management – don’t just leave it to HR
2. Focus on developing clear career paths
3. Take a holistic approach to talent management across the entire employee population
Non-financial benefits of the sort offered by effective HR functions are difficult to quantify. But new technologies are enabling robust data and analytics capabilities, allowing HR functions to evaluate and make evidence-based decisions that positively impact the business. Rather than following industry trends and adopting off-the- shelf solutions, companies should seek to:
1 Ed Michaels, Helen Handfield-Jones and Beth Axelrod, The War for Talent (Harvard Business School Press, 1997).
2 Survey by AM Azure of the organizations featured in The War For Talent analyzing 100 plus firms to evaluate current corporate