Building competitive advantage hinges on the recognition that the war for talent is never over
Laura Croucher, National Leader, People & Change
Trina Boivin, Senior Manager, People & Change
History tends to repeat itself. This was particularly apparent in the wake of the recent economic downturn, when the financial crisis triggered an almost predictable rise in unemployment rates. In the scramble to maintain profitability, countless organizations initiated layoffs, instituted hiring freezes, and otherwise shelved new projects and investments. Now that the economy is on an upswing, organizations are refocusing on attracting people with the skills and capabilities required to help them take advantage of improving market conditions.
In many ways, this renewed focus simply accelerates a trend that began several years ago when financial institutions first started translating advanced talent management theories into tangible efforts. Since that time, numerous Canadian banks have established dedicated talent management teams and integrated workforce planning programs designed to support the organization’s short- and long-term resourcing objectives.
Yet, despite this progress, banks now face challenges that barely existed before the financial crisis hit. Although Canada’s financial institutions emerged relatively unscathed from recent market weakness, consumer confidence has been damaged—making it more essential to build a workforce committed to delivering exceptional levels of customer care. This is true across all areas of the bank, from client-facing functions to IT and Finance.
To complicate matters, banks must also build new competencies in response to more stringent regulatory mandates. To meet expanding needs for broader skillsets, many banks are scrambling to build internal capacity for people in a wide range of functions, from financial analysis, finance, and accounting to risk management and technology.
Achieving these objectives requires more than a traditional approach to attracting and retaining talent. Recognizing that the war for talent never ends, financial institutions need to make talent attraction, retention, and training daily activities. This takes more than a different mindset; in many cases, it also requires a cultural shift.
Learning From the Leaders
In the not-so-distant past, talent management was not as complex as it is today. Shifting demographics and technological innovation have changed this equation. As the baby boomer generation retires, many are taking their knowledge with them, leaving organizations with significant talent gaps. Finding new people to plug these holes is complicated by the vastly divergent motivations displayed by today’s younger, multicultural, geographically dispersed workforce. These trends mandate organizations to consider strategies that barely existed only a few decades ago—from flexible work hours, outsourcing arrangements, and mobile workforces to engaging employees through the use of social media.
On the plus side, successful examples already exist. Formal leadership programs now play key roles in attracting, developing, placing, and retaining talent at most of Canada’s top banks. Similarly, many banks use rotational programs for both existing and new employees as part of their overall efforts to expand their resource capabilities, build greater technical breadth, and facilitate their succession planning efforts.
Here’s a case in point: one Canadian organization with an established and mature model considers talent management part of its overall culture and daily practice. As part of its commitment to walk the talk, this organization has embedded accountability for knowledge transfer, development, and resource advancement into its job accountabilities, which are linked to specific roles and the incumbents themselves. Leaders are expected to provide mentoring to their identified successors, and to receive mentoring themselves. In essence, both talent development and resource planning have been embedded into the organizational mindset.
A New Way of Thinking about Talent
To be sure, workforce planning challenges persist. To adapt to shifting market realities, financial institutions must continue to refine their talent management programs to take emerging trends into account as part of their capacity and demand planning. Current programs to address the evolving needs of Generation Y will need to evolve into new programs to address the needs of the emerging Internet generation. And mitigating unforeseen risks requires companies to align their workforce plans to their emerging long-term needs as well.
Fortunately, Canada’s banks are well on their way. Already, leaders recognize that conversations around talent cannot remain confined to human resources professionals. Instead, top management must think about talent, care about talent, and develop talent all the time. They must identify potential leaders from both outside the bank and from all levels and departments within the bank. They must discuss resourcing issues at weekly department meetings and monthly reviews. And they must commit to actively seek out opportunities for learning to foster the development of necessary skills.
At the same time, these individual managerial efforts should be supported by more formal organizational structures, processes, and technologies. For instance, financial institutions may be able to avoid potential talent shortages if they understand how labour market forces, new communications approaches, and emerging reward cultures will affect their resourcing strategies. They may be able to plug knowledge gaps by sharing and managing information in more collaborative ways. They may be able to heighten employee engagement by continually investing in understanding what motivates their people and providing incentives for the right behaviour. And they will almost certainly improve performance and shareholder value by finding ways for their staff to more effectively collaborate, learn, and share knowledge.
Fostering a Talent Management Mindset
Before workforce planning can yield measurable results, financial institutions must ensure they have the appropriate resources, processes, and infrastructure in place. The following questions can help you assess your readiness:
- Do you have fully effective workforce planning tools and techniques that give you a clear view on resource allocation?
- Does every employee understand how their job functions contribute to business success?
- Do you continuously work to identify developmental opportunities for your staff?
- Has your leadership team integrated workforce planning into their daily activities?
- Do you link workforce planning strengths to the performance of individual managers?
- How do you share information and knowledge capital?
- Do you have processes for measuring the progress and effectiveness of your workforce planning strategies?
Taking a Long-Term View
When considered through this type of integrated lens, it becomes clear that strategic workforce planning requires a cultural shift. Rather than considering how to win the talent war, financial institutions need to adopt programs and practices designed to support employee growth, leverage learning opportunities, and foster the ongoing development of critical skills.
As resources become scarcer and the competition for talent continues to heat up, the financial institutions best able to effectively identify, develop, deploy, and retain top talent will emerge victorious. Similarly, both consumer confidence and business growth depend on the existence of a loyal, committed, and happy workforce. By approaching employee engagement as an ongoing strategic imperative, rather than a single initiative, Canada’s financial institutions can build a talent culture that positions them to realize improved productivity, profitability, and shareholder value over the long term. High-performing organizations recognize this reality, which is why they continue to invest in nurturing high-potential talent.