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A Talent Strategy defines an organization's talent needs aligned with overarching business goals. It ensures that relevant talent pools meet the core strategic demands of the business by identifying essential capabilities, prioritizing them, and determining worker sources and types. This strategy not only clarifies vital staff and contractor roles but also outlines how these roles will be sourced in the future, informing both operational and HR decisions.
Core to the development of a complete talent strategy is to consider the use of the "Six (6) Bs", which refer to the range of strategies used to close talent gaps. They are defined as follows:
Buy: acquiring talent from outside the organization through active recruitment efforts. This is the most typical tactic for gaining the needed capabilities at scale.
Build: developing the capabilities needed inside the organization with learning and development activities. This is a long-term strategy used for augmenting "buy" tactics and developing a critical workforce that has more staying power due to its career development and mobility benefits.
Borrow: partnering with outside agencies and individuals to use non-employee resources to fill skill needs on an ongoing (e.g., contingent contractors and consultants) or short-term (temporary or summer hire/intern) basis. This option is often used as either 1) an ongoing labor cost-savings tactic or 2) a stop-gap measure while building through the other methods.
Bind: building special programs for retaining critical skills employees with distinct attention, development, mobility, incentives, pay, benefits, etc. This is a commonly used tactic with high potentials ("HIPOs") and executives that can be applied to critical skills employees.
Bot: leveraging autonomous (IT) programming to automate repetitive tasks and thus replace existing employees.
Bounce: moving lower performing employees out of the organization or to roles better suited to their capabilities.
A talent strategy is not only related to filling roles; it is also critical to aligning an organization's human capital with its vision, ensuring sustained growth, adaptability, and success. Businesses should invest in a Talent Strategy to create a sustainable and robust workforce. It is designed to produce several key benefits that provide a competitive advantage from both workforce and business/operations perspectives.
A talent strategy informs numerous pieces of both operational and HR strategies by clarifying the staff and contractor capabilities that are most crucial to the achievement of business objectives, as well as how those roles will be filled in the future. There are five primary stages involved in developing a sound strategy:
The specific steps, best practices, and tools for effectively deploying this process are included in "Developing a Winning Talent Strategy to Identify Key Capabilities and the Most Appropriate Workforce Mix". This Supplemental Guide is freely open to all Wowledge members.
At the core level, Talent Strategy predominantly involves matching current job roles with available skills, ensuring immediate needs are met. Transitioning to the advanced level, organizations take a more holistic approach, integrating skills assessments, predictive analytics, succession planning, and aligning talent plans with long-term business strategies. Companies at the emerging level push boundaries further, incorporating futuristic trends, leveraging advanced AI and data analytics for talent forecasting, and ensuring adaptability to fluid business landscapes, often venturing beyond traditional talent pools and exploring diverse, global, and alternative workforces. In essence, as companies progress, their Talent Strategy evolves from a reactive stance to a deeply proactive, innovative, and expansive approach.
Crafting a comprehensive Talent Strategy doesn't simply emerge from a vacuum. Instead, it's a collaborative effort involving multiple roles, each bringing its expertise to the table to address the multifaceted talent needs of a business. It requires the engagement of operations leaders, line managers, and HR/talent experts to bring the strategy to fruition.
CEO or Business Leaders: Provide overarching business goals and future direction. They ensure alignment between business objectives and the talent strategy, bringing future business directions and plans to the forefront for conversion into talent needs.
CHRO or HR Leader(s): Give insights into the current HR landscape, capabilities, and existing talent pools. They are responsible for the overall talent strategy and weigh heavily on the choosing of the workforce mix and resourcing.
Workforce Planning Specialists: Conduct analyses and assessments that project future staffing and skills needs. Those projections are then provided to both HR and operations managers for their planning and budgeting.
Talent Development Leads: Assess existing internal talent competencies, skills, and training programs. They design targeted talent development plans for talent segments that need to be grown internally.
Talent Acquisition Managers: Analyze recruitment trends, challenges, and external talent availability. They create strategies for external recruitment and talent acquisition.
Vendor Management or Outsourcing Leads: Evaluate the potential and constraints of contracted or outsourced talent. They propose sources and outlets that are suitable for talent borrowing or outsourcing.
Analytics Specialists: Measure employee satisfaction, engagement levels, and potential attrition risks. They develop comprehensive strategies for employee retention.
Talent Management or Succession Planning Experts: Review leadership pipelines, potential future leaders, and existing gaps. They outline plans for accelerating leadership pathways for high-potential employees.
The sphere of talent strategy has seen a dynamic evolution over the years, adapting to changing business needs, global circumstances, new ways of working and workforce groups, as well as advancements in technology. The "6Bs" model — Build, Buy, Borrow, Bind, Boost, and Bounce — has also evolved over the years and further refined how organizations approach talent management, particularly in the recent past.
As businesses continue to evolve and the world sees more socio-economic and technological changes, talent strategy will further refine itself, ensuring organizations are always prepared to meet their objectives through the right talent approaches.
Multiple options may be chosen to close the identified gap in workers needed in a complete talent strategy. An example of a full Talent Strategy exercise for an illustrative business goal is shown below:
When developing a Talent Strategy, several critical aspects come into play. Foremost, alignment with organizational goals is essential; the strategy must not only address immediate needs but also anticipate future business objectives and the evolving landscape of the relevant geography(s), marketplace(s), and industry. Understanding the skills and capabilities currently within the organization versus those needed in the future is crucial, paving the way for decisions on whether to develop internal talent or seek expertise externally.
The flexibility of the strategy is another vital aspect, allowing for adaptability to unforeseen changes or shifts in the market. Moreover, a successful talent strategy recognizes the importance of an inclusive and diverse workforce, ensuring varied perspectives and enhancing innovation. Integrating technology, especially in data analytics, can provide valuable insights and aid in making informed decisions. Lastly, fostering a culture that values continuous learning, well-being, and engagement will enhance the effectiveness of any talent strategy, ensuring longevity and resilience in an ever-changing corporate world.
What other terms are related to Talent Strategy?
Various terms are sometimes used to refer to a talent strategy, highlighting specific aspects or nuances of the broader concept. Nonetheless, these concepts achieve different outcomes or specialized objectives of their corresponding strategy. Some of these terms include:
What are the uses and implications of generative AI on Talent Strategy?
The introduction of generative Artificial Intelligence (AI) technologies into the realm of Talent Strategy holds numerous implications, both promising and challenging. Considering each one requires due diligence into available technologies and their pros and cons.
Incorporating generative AI into Talent Strategy, therefore, requires a balance. While its capabilities can revolutionize many facets of talent management, the human element – with its intuitive understanding, empathy, and ethical considerations – remains irreplaceable. Organizations will need to navigate this balance to harness the potential of AI in their talent strategies.
A talent strategy defines the talent needs and associated objectives necessary to meet top business goals. It is both an integral part of the HR strategic plan and a direct informer of the talent management strategy and planning process.
An HR Strategy defines the process of identifying business-based human resource (HR) tactics that will constitute a comprehensive multi-year approach to the management of the HR function's structure, governance, programs, policies, and practices.
As a company defines its business strategy, each function must align its objectives and actions to support its strategic goals. Talent management strategy is a key process that the HR function follows to accomplish this directive by identifying priorities and setting up plans to advance talent management practices.
A critical talent plan defines the specialized and concentrated efforts that will be undertaken for those roles deemed to be of the greatest importance to meeting the organization’s strategic objectives.
This tool incorporates the multi-source staffing strategy outlined by Dave Ulrich and others that references the “Buy, Build, Borrow, Bind, Bot, and Bounce” options for proactively filling, retaining, and managing critical skill workers as available resources within the organization.