Talent management is now firmly on the C-suite’s agenda with organizations competing for top talent on an unprecedented scale. Despite the increasing concern for talent issues, new research findings from KPMG International reveal that many organizations take a narrow approach to talent management – one that is steadily weakening their organization’s competitiveness and agility.
The top ten risks identified by survey respondents focus primarily on capacity and capability and are associated with building the skills an organization needs as well as maintaining the size of the workforce needed to deliver its business plan. However, the survey also revealed respondents’ apparent lack of concern and interest in connecting and engaging with their talent, as well as enabling and encouraging collaboration.
“Globally, managers are only seeing half the picture,” says KPMG Global Head of People & Change Mark Spears. “Organizations are being driven to implement short term point solutions, ignoring the need to configure their talent management efforts in a broader, more sustainable way which aligns more closely with their organization’s strategic needs.”
The Talent-Related Risk Disconnect
In the report entitled, Time for a more holistic approach to talent risk, Respondents ranked the risk of their ‘business leader inability to engage with, motivate and nurture business critical talent’ as a top ten critical risk, yet placed it in the top ten risks that were being least managed.
“Going forward, talent managers must isolate and address a much broader array of talent risks,” continues Spears. “They need to take into account a critical need to connect their people to each other and to leadership, to forecast and manage costs and to move away from an approach to compliance that sees line managers simply ticking the box on performance reviews – or failing to conduct them at all.”
Other Key Findings:
- Talent management in need of a tune-up - Just a third of respondents (33 percent) felt their business unit leaders were incentivized to share talent across organizations for the benefit of the business and the talent – seemingly at odds with the inclusion of development, retention and several other critical risks.
- Where the talent review process goes wrong - Only 40 percent of respondents said they spend two or more days per year with their senior leadership teams formally reviewing talent and more than 20 percent stated that they lacked a formal talent review process all together. More than 58 percent said their leaders take no action – or lose momentum – once talent reviews have concluded.
- Critical skills and capabilities - Only 53 percent of organizations with less than 3,000 employees felt their leadership took an active role in the coaching process. This compares to 70 percent of respondents working at organizations with more than 10,000 employees.
- Top risks by industry - Consumer Goods was the only industry to elevate candidate salary expectations for top talent above concerns over recruiting top talent. Energy leaders noted that skills and capabilities required by the business not being developed was a top five risk.
- Diversity in the workforce - Managers failed to include ‘a lack of workforce diversity’ within their foremost-perceived risks relating to how well they were managing their organization’s people. When it came to the talent risks managers are actually working to reduce and mitigate, diversity again failed to appear – and appeared again in the list of challenges managers were least likely to be working to remedy.
“Until talent managers trade the war for talent’s one-size-fits-all mentality in favor of a more finely-tuned and comprehensively planned approach, they will remain stuck in an endless struggle to pursue and retain a high-performing few, all the while ignoring the needs of the many and the whole,” says Spears.
For more information, please contact:
Amy Greenshields, KPMG International
+1 416 777 8749
About the survey
The research, conducted in collaboration with global research firm Brandon Hall Group between May and August 2013, involved a survey of over 1,200 organizations, gathering responses from executives, business leaders, and HR leaders in 54 developing and developed countries, covering 15 different industries. In addition, senior respondents were also interviewed using their perspectives to provide a qualitative picture of talent risk. Download the full report.
About KPMG International
KPMG is a global network of professional firms providing Audit, Tax and Advisory services. We operate in 156 countries and have 152,000 people working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. Each KPMG firm is a legally distinct and separate entity and describes itself as such.