What is talent management and why is it important?
Reading time: 2m 30s.
Although the benefits of effective talent management have been much discussed over the past decade, it is only recently that organisations have started to move from discussion to action. Effective talent management is about identifying, developing, engaging and retaining ‘high value’ individuals with either high potential for the future or who are fulfilling business critical roles. It highlights the importance of not only attracting individuals with high potential, but also developing, managing and retaining them while measuring the return of this investment. Effective talent management can contribute to a variety of strategic objectives:
- Building a high performance workplace
- Encouraging a learning organisation
- Identifying as an ‘employer of choice’
- Ensuring return on investments in training and development
It seems common sense that, if you have a highly engaged workforce with the right skills, it can vastly benefit your business. However, it is important to note that you need to consider all aspects when addressing your organisation’s approach to talent management. There is no point having a highly skilled and trained workforce if they aren’t engaged and motivated to complete their work, and vice versa.
Poor talent management can affect your business in a number of different ways. An untrained workforce can lead to an increase in the amount of time it takes to complete tasks and a higher number of errors and/or accidents. However, these issues can still occur despite considerable investment in training. Training will only make a difference to your business outcomes if it is addressing the right skills needs and being delivered in a way that allows time for learning and the opportunity to implement this learning on the job. So many businesses implement training without measuring whether it makes a difference to business outcomes and leads to a return on investment.
Another important reason to consider investing in learning and development opportunities in your business is that research suggests it is linked to high levels of employee engagement, even among staff members who are paid less. There has been a lot of discussion in the media recently about the living wage, with figures suggesting that one in five people in the UK earn below the threshold, placing the UK as one of the worst offenders among OECD countries (The Work Foundation). In this economic environment in particular, training and development can be of particular value to jobseekers, as many people still struggle to find their ideal job first time round. A strong career pathway within what might be considered a temporary role can encourage employees to view their job as a career, rather than a stopgap solution.
Poor employee engagement is linked to problems with staff retention levels. This can have a considerable cost to your business, with current estimates at over £5,000 to recruit a new member of staff. Addressing your employee engagement can have a significant return not only in terms of increased staff retention, but also through increased motivation and commitment.
Next month I’ll be discussing the various ways you can effectively address the issues discussed above, along with some hints and tips on how to get the most out of talent management solutions.
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