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How to Build a Strategy of Talent Management

Any organisation with employees has to deal with hiring and retention, but not everyone has a solid strategy for talent management. In fact, one Kaplan survey found that nearly half (46%) of respondents did not have a talent management program in place.

To help ensure your organisation isn’t missing this crucial plan, here’s our guide to building a talent management strategy.

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What is Talent Management?

Talent management covers the full range of HR processes – all the ways in which HR can attract, onboard, develop, motivate, and retain the best employees. Effective talent management helps employees be more productive and satisfied with their work, benefitting the overall organisation. 

The term “talent” in this case is used to refer to human resources or employees.

What is a Strategy of Talent Management? 

If talent management is the range of HR activities involved in hiring and retaining the best talent, a talent management strategy (TMS) is the plan of action that helps organisations achieve their talent objectives now and in the future. 

A strategy should enable HR and management to go above and beyond the basics of talent acquisition and performance management. It should help bring together 1) business objectives with 2) the development goals of present and potential future talent (employees).

What Are the Benefits of a Talent Management Strategy?

There are a wide variety of benefits of a talent management strategy, from hiring the right staff to retaining the best talent to better understanding employees. 

Perhaps it’s easiest to understand the benefits by asking organisations with a strategy why they choose to have one. The Kaplan survey referenced earlier found that there were some compelling drivers for organisations to invest in formalising their talent management strategy:

  • 83% – Retention. If we don’t do it we lose our best people

  • 79% – Developing our people is key to our organisation’s ethos

  • 72% – Business growth. We need new leaders to grow our business 

  • 43% – Offering development as part of the value proposition for new hires

  • 16% – To be honest, we have a skills gap and we’re playing catch up

  • 1% – Other

One McKinsey study found that only 5% of respondents reported effective talent management processes and a noticeable increase in company revenue.

Of this 5%, however, 99% said they had outperformed all competitors – proving how impactful an effective Talent Management Strategy can be when organisations invest in developing one.

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How Do You Start a Strategy of Talent Management? 

Starting a talent management strategy is the responsibility of the HR function, but integrating business goals is a core component. Here are some steps to start developing your strategy of talent management:

  1. Define your organisation’s goals

  2. Translate what those goals mean for human resource needs

  3. Perfect your job descriptions

  4. Build company culture

  5. Invest in current employees

  6. Prioritise hiring internally

  7. Measure success of the strategy over time

  8. Lead from the top & ensure executives are on board

Building a proper talent management strategy can have major impacts on talent concerns like retention and acquisition, but also on the organisation’s overall health and success.

4 Talent Management Best Practices 

Talent management can only have maximum impact when it’s done intentionally and effectively within an organisation. Here are some best practices and areas teams should focus on the most:

  • Base decisions on data – When an organisation can base its talent management decisions on accurate, relevant, and timely data, those choices are more likely to lead to highly effective initiatives and better results.

  • Turn business goals into talent goals – Talent management will have the most impact when objectives are tied to the overall aims of the business. This also means the reverse is true: talent must be integral to the business strategy, not an afterthought.

  • Get executive buy-in – As the Harvard Business Review puts it, “Game-changing leaders not only excel at articulating the vital importance of talent management but also are heavily engaged in their companies’ actual practices. They demand that their line leaders be accountable for spotting, developing, and retaining the next generation of leaders.”

  • Utilise technology – Using an HR system to help with talent management strategy makes it easier to find and retain the best talent, streamline onboarding, manage performance, and more.

Which HR Systems Can Help with Talent Management Strategy? 

Technology – and more specifically HR systems – can help implement your talent management strategy and streamline talent processes. 

Personio is an all-in-one software solution to automate and simplify your HR tasks, including talent management initiatives like recruitment, onboarding, and performance. Integrating all data and processes in one place also saves HR teams time so they can focus on activities that add value for their employees and the organisation overall.

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