TALENT POWERED ORGANIZATION Strategies for Globalization, Talent Management and High Performance

THE TALENT POWERED ORGANIZATION Strategies for Globalization, Talent Management and High Performance Peter Cheese, Robert J Thomas and Elizabeth Craig with a foreword by Don Tapscott London and Philadelphia Publisher’s note Every possible effort has been made to ensure that the information contained in this book is accurate at the time of going to press, and the publishers and authors cannot accept responsibility for any errors or omissions, however caused. No responsibility for loss or damage occa- sioned to any person acting, or refraining from action, as a result of the material in this publication can be accepted by the editor, the publisher or any of the authors. First published in Great Britain and the United States in 2008 by Kogan Page Limited Apart from any fair dealing for the purposes of research or private study, or criticism or review, as permitted under the Copyright, Designs and Patents Act 1988, this publication may only be reproduced, stored or transmitted, in any form or by any means, with the prior permis- sion in writing of the publishers, or in the case of reprographic reproduction in accordance with the terms and licences issued by the CLA. Enquiries concerning reproduction outside these terms should be sent to the publishers at the undermentioned addresses: 120 Pentonville Road 525 South 4th Street, #241 London N1 9JN Philadelphia PA 19147 United Kingdom USA www.kogan-page.co.uk © Peter Cheese, Robert J Thomas and Elizabeth Craig, 2008 The right of Peter Cheese, Robert J Thomas and Elizabeth Craig to be identified as the authors of this work has been asserted by them in accordance with the Copyright, Designs and Patents Act 1988. ISBN 978 0 7494 4990 2 British Library Cataloguing-in-Publication Data A CIP record for this book is available from the British Library. Library of Congress Cataloging-in-Publication Data Cheese, Peter. The talent powered organization : strategies for globalization, talent management and high performance / Peter Cheese, Robert J. Thomas, and Elizabeth Craig. p. cm. Includes bibliographical references and index. ISBN-13: 978-0-7494-4990-2 1. Creative ability in business. 2. Ability. 3. Success in business. 4. Organization. I. Thomas, Robert J. (Robert Joseph), 1952– II. Craig, Elizabeth. III. Title. HD53.C47 2007 658.3Ј14--dc22 2007031113 Typeset by Saxon Graphics Ltd, Derby Printed and bound in Great Britain by MPG Books Ltd, Bodmin, Cornwall Contents Foreword v Acknowledgements xi Introduction from the authors 1 1 Talent Imperatives for a New Economic World 7 A new context 8 The strategic importance of talent 11 The need to embrace diversity 15 The importance of learning and skills development 28 The challenge of engagement 35 Managing talent throughout the organization 46 Summary 49 2 A Strategic Approach to Talent 51 The executive perspective 52 High performance – the key drivers 55 How to multiply talent 57 The HR function in the spotlight 81 HR and talent management: an unfinished evolution 82 Summary 86 3 The Discovery of Talent 88 Identifying your talent needs 90 Recruitment: will you discover talent or drive it away? 97 Summary 112 iv l Contents 4 From Talent Development to Deployment 113 New demand for new skills 114 Deploying talent: managing the work strategically 144 Summary 151 5 Engagement 152 Why engagement matters 152 What engagement means 154 Drivers of engagement 163 Gaining more insight on engagement – segmenting the workforce 181 The key ingredient of engagement – the line managers 184 Summary 187 6 Embedding and Sustaining Talent Power 188 Measuring talent’s contribution to business performance 189 Measuring process effectiveness – the concept of maturity 196 A framework for prioritizing and measuring human capital investments 201 The transformation and reorganization of HR 208 Everyone’s responsible 222 Failures of communication 231 Summary 233 7 Next Steps and the New Imperatives 234 Becoming a talent-powered organization 235 Critical tasks for key stakeholders 247 Conclusions – beyond talent multiplication 253 References 255 Index 265 Foreword If you are not yet a believer, this book will convince you that talent has become the single most important force creating strategic value for your organization. And it will give you a new framework for doing something about it. Under industrial capitalism, the key corporate assets were physical resources, physical plant and financial capital. Today physical resources are relatively unimportant in most industries. Even in the steel industry it’s not the iron ore that counts but the people, knowledge, systems and processes that count. In yesterday’s economy, workers contributed their brawn, not their brain. Companies invested in big factories with production processes and sophisticated machinery that required little decision-making or skill from the operator. General Motors 50 years ago did strength tests for prospective factory workers. Physical labour was a commodity sold by workers and organized by their unions to increase its value. Time at work was pretty much time taken away from your life – and working people sought their personal fulfilment through leisure. No longer. Today, the only meaningful assets are knowledge assets and the only meaningful form of capital is intellectual capital. This is why former Citigroup chief executive Walter Wriston once noted that ‘Information about money has become almost as important as money itself’. The revolution in information and communications technologies is at the heart of these changes. The internet and other technologies enable thinking and the communication, management and sharing of knowledge like never before. And workers derive a great vi l Foreword deal of their sense of self-worth from the work that they do and the intellectual contributions they make. This book amply documents that today’s organizations need to be able to learn and teach if they wish to be competitive. In the authors’ words, ‘the key factor in determining the success of any organization is its ability to use human talent – to discover it, develop it, deploy it, motivate and energize it. Human talent – the combined capacity and will of people to achieve an organization’s goals – is a productive resource like no other.’ A company remains competitive only if it acquires, develops and uses knowledge faster than the competition. Any firm can have the same technology as another company; any product can be copied. Competitive advantage is ephemeral as firms constantly seek new ways to create value. Marketplace success hinges on the knowledge and creative genius of the product strategists, devel- opers, and marketers. Peter Senge was right to note many years ago that organizational learning becomes a critical competitive advantage. Coupled with this corporate transformation is the arrival of a generation of workers with a completely new approach to the workplace. Today’s youth are the first generation to come of age in the digital age. Computers and networks are transforming business, entertainment, government and every institution around them. Unlike their parents, they have no fear of the new technology because it is not technology to them. I call them the Net Generation. Their arrival is causing a Generation Lap – they are lapping their parents on the info track. For the first time ever children are an authority on a central innovation facing society. This has profound implications for corporations. Although the Net Generation is savvy, confident, upbeat, open-minded, creative and independent, they are a challenge to manage. To meet their demands for more learning opportunities and responsibility ownership, instant feedback, greater work/life balance and stronger workplace relation- ships, companies must alter their culture and management approaches, while continuing to respect the needs of older employees. Properly cultivated, this generation’s attributes will be a critical source of innovation and competitive advantage to the organization. But while the demand for knowledge workers grows, the domestic supply is shrinking. Enrolment in science and technology faculties is declining in the US and other western countries. The upshot is that companies increasingly conclude that it makes more sense to locate Foreword l vii new research facilities in countries where there is a larger supply of science and technology graduates. This usually means opening offices in China or India. Any job that is not confined to a particular location has the potential to be performed anywhere in the world. If the job activities do not require physical proximity, local knowledge, or complex interactions with colleagues, then location is immaterial. Such jobs may be performed wherever a company deems most attractive. Furthermore, human capital is becoming networked as organizational boundaries become increasingly porous. In 1937 the Nobel laureate economist Ronald Coase asked why corporations exist. After all, the marketplace was theoretically the best mechanism for equaliz- ing supply and demand, establishing prices and extracting maximum utility from finite resources. So why weren’t all individuals acting as individual buyers and sellers, rather than gathering in companies with tens of thousands of other co-workers and effectively suffocat- ing competition within the corporate boundaries? Coase argued that the answer was transaction costs, such as searching the marketplace for the right product and negotiating its purchase. The upshot is that most corporations concluded it was more cost-effective to perform as many functions as possible in-house. That was then. Today is now. The new information and communications technologies centred on the internet are slashing transaction and collaboration costs. The result has been that vertically integrated corporations have been unbundling into focused companies that work within what I call business webs. The mantra ‘focus on what you do best and partner to do the rest’ is serving most leaders of the global economy well. In the past a company would outsource functions and ask for weekly or monthly status reports.

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