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In the News: Check out my latest article on Competent Competency Models in eTEQ, The Pittsburgh Technology Council’s Online Magazine. eTEQ explores the hottest companies, coolest people and latest trends and issues in southwestern Pennsylvania’s technology industry.

 

Top 10 Signs That You Are NOT Taking A Strategic Approach to Talent

Google "Strategic Talent Management" and you will come up with about 2 million hits. The discussion about STM is reaching a fevered pitch online, in blogs, and at conferences. Approaching talent from a strategic perspective is more than just a hot topic. It is a significant evolutionary step up from "Employees First" or "People Are Your Most Important Asset" perspectives. STM puts the emphasis back where it should be – on strategy – and driving the business strategy with a focused workforce strategy.

My new mantra is "People are NOT your most important asset. The right people in the right roles doing the right things are your most important asset". "Right" can only be determined from the context of the business strategy.

So, is your company evolving, taking a strategic approach to talent and adding to the STM discussion? I thought it might be enlightening to answer this question by describing what STM is not so here is my top ten list of Signs That You Are NOT Taking A Strategic Approach To Talent.

  1. No one can adequately describe the link between talent and the business strategy
  2. Regular, robust discussions about talent are not built into the business planning process
  3. Executives are not held accountable for managing talent
  4. Employee performance goals are not clearly linked to company goals
  5. The measurement of talent focuses on the budget or recruiting efficiency
  6. Differentiated investment in high-value employees doesn’t occur because of the concern that some employees might feel left out
  7. Poor performance is tolerated
  8. Everyone gets the same annual base increase, no matter if they are low and high performers
  9. T&D is all "T and no "D"
  10. Competency models are not high-performance +/or future-focused

Learn More about the Top 10
Learn about Strategic Talent Management

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From The Best and The Brightest

I had the unique opportunity to hear from several benchmark leaders recently and came away with some real nuggets, pearls of wisdom, idea gems . . . you get the point . . . about organization talent.

The first leader was EQT Corp. Chairman Murry Gerber who spoke at a Leadership Dialogue series on the tremendous opportunities created by the Marcellus Shale and its importance to the US's energy independence. His candid comments about the state of our energy policy were enlightening. However, it was a side note comment about the type of people that he wants working around him that stuck with me. This is not an exact quote but Mr. Gerber stated something like, "Some people know how to get things done, many more can tell you what to do. I'll take the How's over the What's any time." (When he took over the leadership of EQT, he also stated in employee meetings that his role was to "change people or change people".)

The other source of talent insights was a panel discussion featuring HR Leader of the Year award winners for the Pittsburgh region. Though the panel represented a wide range of organizations and business challenges, it was amazing to hear the similarities across the panel in how they have added value to their organizations.

One common theme for companies that successfully changed their cultures was the importance of "Top Grading" or assessing and differentiating the approach they took with pivotal talent. This included regular talent reviews to identify "A", "B" and "C" talent, building a common language of success and improving the performance management capabilities of managers. This talent differentiation was also reflected in compensation practices for several companies.

By the way, are you interested in the trends that are keeping the HR Award Winners awake at night? They highlighted three:
  1. The numerous landmines being created by legislative and compliance changes foisted upon business by an activist federal government (expletives deleted),
  2. Global economic changes and the impact that will have on their business, and,
  3. The changing demographics and expectations of the workforce.

Do you see the theme that I heard? Mr. Gerber had a simple way of identifying the "A" talent that helped him change EQT from a moribund utility to a fast growing player in the US energy economy. The HR Leaders used a more refined technology to develop a strategic approach to talent that made a difference in their firms. Either way, sounds like a recipe for success.

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Better Living through Culture
By Louis A. Musante
Echo Strategies

Lou Gerstner, IBM's enigmatic CEO, tried to do two things every day: go to church and meet with a customer. I'm not a proponent of mixing church and state, but Gerstner's success in changing the culture of a company the size of IBM could almost be considered a miracle. Certainly, it was a job nobody else wanted. Since the days of Chairman Tom Watson, IBM had been known as a strong culture, with white shirts and company songs, with service excellence and a blue-chip image. But in the late 1970s and early '80s, the company's luster began to fade. IBM had become too rigid and internally focused. The strength of its culture had, in fact, made it too inflexible to change. The company took its eye off the customer and lost its ability to adapt.

>  " . . . the only thing of real importance
that leaders do is to create and
manage culture . . . "
Edgar H. Schein, Professor
Sloan School of Management,
M.I.T.

Corporate culture is moving into the limelight and proving to be an untapped asset for employees and businesses alike. It's a concept that top executives must really "get" to survive. Research makes it clear that even during an economic downturn, companies with strong and adaptive cultures perform significantly better financially than those with weak or poorly defined cultures. The right corporate biology--the optimal combination of people and culture--can mean the difference between remarkable financial success and failure.

Although we live in a time of unprecedented technology usage--propelled by the power of Web software and advances in enterprise resource planning, customer-relationship management, E-business, collaboration, and enterprise messaging--success in business is even more dependent on employing and motivating the best people than it is on having the best Web site, the biggest databases, or the fastest processors. The best technology is no longer enough.

But the culture issue is still a tough sell. In an InformationWeek poll of 250 IT executives, 60% of respondents said that it's somewhat or very difficult to change their companies' cultures or to encourage knowledge sharing and collaboration instead of knowledge hoarding.

As logical as it may sound to consider corporate culture as a competitive asset, most still will think, "I'm so busy, why should I spend time on culture?" But there's hard, scientific evidence of the financial rewards for advancing our knowledge of how to measure and manage a company's culture. The work of John Kotter and James Heskett at Harvard produced four major findings, highlighted in their book Corporate Culture and Performance. These are:

  • Corporate culture can have significant impact on long-term financial performance.
  • Culture probably will become an even more important factor in determining corporate success or failure in the future.
  • Cultures that inhibit long-term financial strength are common and develop easily, even in companies full of reasonable and bright people.
  • Corporate culture can be managed and changed.

Culture is becoming as important an element as customer focus in achieving the balanced-scorecard strategic-management approach used by many companies. Employee engagement drives customer loyalty, which correlates directly to the fruits of business success, sustainable competitive advantage, and stakeholder value. Just as intellectual property is making its way to the top of management's must-have list, culture management is finally emerging from academic journals into mainstream management literature. One could even argue that culture is the ultimate form of intellectual property.

Read more about Better Living through Culture

Lou Musante is managing partner of Echo Strategies, a professional services firm founded in 1983 specializing in marketing research and helping their clients listen, look and play with their stakeholder audiences. Lou considers himself a business “Infopreneur” who likes to have fun and make money.

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