What is Talent Management? All You Need to Know to Get Started
Talent management is one of the most current topics in HR. How can we give candidates the best experience? How can we attract and retain the best people? What do we need to do to win the war on talent?
In this article, we’ll dive into the question “what is talent management”, look into creating a talent management strategy and best practices, as well as examples of digital talent management.
What is talent management?
Talent management is the full scope of HR processes to attract, develop, motivate and retain high-performing employees.
This definition has three components:
- The full scope of HR processes: Talent management is about a set of HR processes that integrate with each other. This means that talent management activities are larger than the sum of the individual parts. This also means that a talent management strategy is required to capitalize on its full potential. More about this later.
- Attract, develop, motivate and retain: This is not a comprehensive list. Talent management touches on all key HR areas, from hiring to employee onboarding and from performance management to retention.
- High-performing employees: The purpose of talent management is to increase performance. It aims to motivate, engage, and retain employees to make them perform better. This is why the importance of talent management is so signigicant. When it’s done right, companies can build a sustainable competitive advantage and outperform their competition through an integrated system of talent management practices that are hard to copy and/or imitate.
In other words, talent management is a process aimed at driving performance through integrated people management practices. As such, it’s one of the key functions of Human Resources.
Talent management strategy
As we’ve mentioned already, when done right, the whole will be greater than the sum of the parts. To achieve this, a talent management strategy is key.
In order to define your talent management objectives and create a strategy, you need to answer the following five questions:
- What are the aspirations of the organization and what are the goals that enable us to measure progress?
When we talk about specific and measurable goals, we mean talent management metrics. These metrics enable us to keep track of what we’re doing and how well we’re doing it. Unwanted turnover is a good example of this. If we can’t retain our star employees, we will most likely not achieve our aspiration.
- What do we want to focus on?
There are multiple areas in talent management that you can focus on. You can become a desirable employer. Being a top employer or being nominated as a Great place to Work requires substantial investment. This can be effective especially when you want to attract people from all kinds of backgrounds. However, if you have a very specific employee profile, for example, engineers, your time is better spent on developing a comprehensive tech sourcing strategy.
The HR talent management model is very helpful in this case as it enables you to map the specific activities that you want to focus on. This will also help in the next step. Below you’ll find a list of talent management practices that you can improve.
- How will we beat the competition?
Unfortunately, you’re not the only one who’s looking for top talent. Your competition is as well. How can you outperform your competitors and become a more attractive employer? This can be achieved through better employer branding, better retention, better selection, et cetera.
- What capabilities do we need to build or continue to win?
Talent management requires specific skills that are not always common within HR. Think about marketing to become a more attractive employer, and hiring a dedicated talent manager. Another example is HR data analytics expertise to make sure you get the most out of your existing population. Depending on your focus points, you need to develop different capabilities.
- How do we track progress and improve?
The final step is about tracking progress and ensuring the further improvement of talent management processes. A good way to do this is by using a talent management dashboard. Such a dashboard can provide an overview of the Key Performance Indicators and can display changes over time.
These questions are based on a 2010 article on building a strategy by Roger L. Martin.
Which talent management practices should you focus on?
So, I hear you ask, how does this work in practice? What are the common talent management best practices to apply? Here’s a brief overview.
- Employer branding: Having a strong brand attracts even the best candidates.
- Employer reputation: Reputation is related to employee branding. However, reputation is more affected by external media the company has less control over. An example of reputation gone wrong is the banking sector in recent years, especially after the 2008 financial crisis.
- Candidate experience: The experience of the candidate influences the employer brand.
- Selection: Spotting and selecting the best is a critical part of talent management.
- Referrals: Talent knows talent. Referral programs are effective as they help to pick up candidates that onboard quicker and perform better. We listed 7 employee referral programs examples you can take a look at to get inspired.
- Onboarding: Getting people up to speed as quickly as possible helps to make them more productive and increases employee retention.
- Inboarding: Yes, you read it right. When people are promoted internally, they also need support to achieve maximum productivity. This is called inboarding.
- Engagement: Engaged employees are motivated, perform well, and are more likely to stay.
- Retention: Retention strategies help to keep the best people on board. An example is succession planning.
- Succession planning: You want to be able to fill crucial top positions whenever they become vacant. Having a talent pipeline that ensures succession planning is a key element in this.
- Learning and development: This is not only a common talent management practice, it’s also a Human Resource best practice. Educating employees helps increase performance and retention. After all, once you’ve recruited the best people, you want to make sure they remain the frontrunners in the field, right?
- Performance management: An essential part of managing talent is tracking and improving their performance.
- HR analytics: As we’ve said before, by leveraging data you can ensure that you’re hitting the right KPIs that have an impact on business outcomes.
Of course, this is not a comprehensive list. There are many more activities that help to build and maintain an effective workforce.
Examples of digital talent management
So what does talent management look like in this digital age? It encompasses all of the above but is supported by a range of HR tech tools. Think of them as your digital toolbox. We’ll highlight a few of them.
The selection of candidates is, of course, a crucial part of your talent management process. A data-driven preselection tool can support you with this, especially if you have high volumes of applicants.
In a nutshell, this is how it works. While the applicants go through an online assessment, playing games and answering questions, The tool collects data about their actions and answers.
With the help of machine learning techniques, customized algorithms can then make predictions about a candidate’s likelihood of success in the role they apply for. Companies like Harver, HireVue, and Pymetrics provide this kind of HR matching technology.
Onboarding is a part of the recruitment process that has long played – and often still does – second fiddle. A terrible shame, because a disappointing or non-existing onboarding experience is one of the most important reasons new hires leave prematurely.
We’ve said it before, the onboarding period is like the honeymoon for new employees. They’re still on a high from getting that amazing job they wanted so badly and can’t wait to dive right in. As an employer, you want to seize that moment.
There’s some great HR onboarding software out there that takes care of the entire process. From the moment the candidate accepts the offer to the creation of a personalized induction program that you send straight to your new employee’s phone.
Feedback is the word. Employees want feedback – and especially the Millennials. Constantly. And although feedback generally is a good thing, we don’t want to end up like in a certain episode of Black Mirror in which every single interaction we have with everyone is being evaluated.
As a result, you know better what’s going on in your employees’ mind which means you can react if necessary. This, in turn, can have a positive impact on the happiness of your people and their overall employee experience. It can also increase their engagement and eventually reduce turnover. Technology really is a beautiful thing, isn’t it?
Talent management is the full scope of HR processes to attract, onboard, develop, motivate, and retain high-performing employees. Talent management is aimed at improving business performance through practices that make employees more productive.
The first step of the talent management process is attracting and selecting A-players. When a company is able to both attract and select (future) top performers, all its other talent management practices will be much more effective.
The key components of talent management are attracting, developing, and retaining high-performing employees. The process starts with selecting the right people, giving them all the tools they need to be successful, and retaining them for the long term.
Winning the war on talent
In order to win the war on talent, you need a focused talent management strategy, apply best practices and leverage (a selection of) digital tools. Creating a talent strategy isn’t easy – but when done right, it can be very rewarding, resulting in a high-performing, engaged workforce.
If you want to learn more about the 11 key elements of a talent management process, check out the article by clicking the link.