A Study of the Rise of Talent Management



1.1 Background

The assignment is an attempt to explain why the issue of Talent Management has become so prominent now despite the fact that it has been around for a long time its definition, uses, and why companies use it. The argument that it is a business strategy will be looked at and the issue of whether companies use it. Its application and the hard issues that it is meant to address given the fact that it deals with human resources as opposed to other resources that companies harness to achieve its mission and goals in the short, medium and long term.

1.2. Talent Management (TM)

1.2.1 Definition of Talent Management

Talent can be referred to as a person's "natural gift" or skill. In the context of HR we can take it to mean or referred to as a person's values, vision and philosophy, knowledge and competencies.

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Management may be described as the acts of getting people together to accomplish desired goals and objectives efficiently and effectively. Management comprises planning, organising, staffing, leading or directing, and controlling an organisation for the purpose of accomplishing it's goals.

With the above definition one may assume that the management of Talent is the use of management tools to make the best use of the skills, knowledge and competencies of staff of an organisation to implement the strategies, missions and goals of an organisation. Talent Managements are found in both the private and public sectors. In some organisations they are a small part of the HR strategy, while in others it is a Business Strategy [1] . The precise meaning of TM is difficult and as Robert E. Lewis and Robert J. Heckman (Human Resource Management Review16(2009)pp139) has indicated that the terms Talent Strategy, Succession Management and Human Resource Planning are often used interchangeable with TM. In the Mckinsey Survey and the subsequent book "War on Talent" Ed Michael et al [2] indicated that TM is about leadership and managers at all levels of the organisation should embrace TM and make it their mind set.

The following definition of Talent Management is resourced from the Human Resources Management Review 19(2009) pp304.

The activities and process that involve the systematic identification of key positions which differently contribute to the organisation's sustainable competitive advantage, the development of a talent pool of high potential and high preforming incumbents to fill these roles, and the development of differentiated human architecture to facilitate filling these positions with competent incumbents and to ensure commitment to the organisation [3] .

1.2.2 The Processes of TM

Talent Management process and activities involves the following: resourced form Bob Little.

Talent management includes recruitment, induction, goal- setting, performance management, assessment, compensation management, learning, career planning and succession planning processes. Its champions claim that these processes give organisations valuable measurements, performance motivators and insights into workforce skills, competencies and emerging leaders. [4] 

The process of planning and managing the acquisition, attracting, screening and selecting qualified people for a job is in the purview of the HR leader and the entire management team. In TM the organisation needs to recruit the staff with the right calibre as employing the "wrong person" for a job is expensive. Inductions is carried out to put the recruited staff through the works of the organisation


The need for companies to harness the human resources and use it to achieve its strategy and remain competitive in the highly competitive world / environment has led to the recent importance of Talent Management. In other words the changing business strategies, the attrition rate of highly educated work force and the cost associated risks of recruiting the "wrong" persons for jobs has led companies to adopt and create Talent Management "Reservoirs" to build, develop and maintain a pool that they can draw key staff for key positions in their organisations. It is a continuous process that needs to be continuously audited, reassessed and see whether it can address the strategies adopted by the business in the short, medium and long terms. It also needs to be the "mind set" (as pointed out by Ed Michaels et al) of all managers and not the HR Manager and his department. However, its adoption and application is far difficult than anticipated and this is one of the reasons why business / companies finds it difficult to adopt it. Businesses that adopts and utilise it properly has come to realise that it does give them competitive advantages in the industries where they operate.

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Recent changes in technology and the awareness by companies that having highly talented employees will enable them; like other resources of the business; a competitive advantage has led to the prominence of Talent Management. With the awareness of the need to have talented workforce has led to organisations seeking highly skilled work force and the changes in demographic, social and business trends have led to job shortages, skills gaps and a rapid pace of change, eg changes in IT industry. All of these trends - together with some worker shortages in specific industries and jobs, make it impossible for recruitment alone to secure the talent necessary for an organisation to stay competitive in today s business environment. Talent Management focused on filling open positions with highly qualified staff that will not only deliver in their own areas but be able to implement the business strategies (mission, vision and values) of their companies. With rapid changes in technology, organisations may be realised that in order to compete they need the latest technology to keep abreast and not to be left out; but lacks the human resources with requisite skills to handle the new technology.


HR role among others involved in the recruitment, development, motivation etc. with other line managers and the top management of the human resources need for organisations. The need to have the right people at the right place and at the right time has led to the elevation of the HR to the business level strategy. Business level strategy is concerned about how to compete successfully in particular markets and in doing so the need for the determination of the right staff with the right calibre arose. The role of HR in an organisation is what made the HR manager to play a business level strategy. HR's role has moved to the business strategy level due to the following:

3.1 Importance of the Human Resource

As the awareness that human beings are the most valuable assets of any organisation, the role of HR becomes more important. As the department that is responsible for the recruitment, developing, motivating and retention of the most valuable asset, HR managers become important at the strategy level to curve the required staff that will enable the organisation to remain focused in the competitive business environment.

3.2 High cost of recruitment and training

The recruitment cost is high and if an organisation recruited the "wrong candidate" for the job then that organisation is likely to lose due to the lack of the right competency to carry out the particular role by the recruit.

To summarise the need of HR Manager to take part at the Business strategy Ed Michaels and his colleagues at Mckinsey has this to say on their book - War on Talent: Attracting, developing and retaining talented people is the stuff of competitive advantage - more so than financing strategies, tax tactics, budgeting or even some acquisitions. Hence the HR leader has much more strategic role to play in the years ahead, arguably one equal to that of the CFO. [5] 

Over the years, the role of HR Director / Manager has become that of an architect for the development of a strategy to create and maintain the pool of Talent for the organisation. They should be the adviser to all leaders on their options and best choices for all job openings be they are new or incumbent positions. Planning of the future requirements and a proper succession planning will enable the filling of the job openings. With a proper TM in place the filling should not be an issue and this will also motivate staff especially the super keepers.


4.1 The Process

Being a process that if implemented properly and developed can give an organisation a competitive advantage we now look at how it should be developed. Building a good Talent Management should not be under the purview of the HR Department only but should involve the entire organisation. The management should undertake an audit of the business, make an analysis of where it is now and look at how it intends to position itself in the future.

4.2 Analysis of the Business Environment and the Business capabilities

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After defining its strategy management should take a proper analysis or audit of SWOT i.e its strengths, Weaknesses, Opportunities, and Threats it faces in the business environment; and assess how Talent Management can be utilised to address these issues in order for them to improve their business strategy. The audit will enable the organisation to raise strategic questions like: why the company exist; it believes and culture; its vision in terms of where it wants to be in the future and it capabilities that it require to achieve those strategies. The analysis will enable management to evaluate whether they have the right talent that can help them stay competitive by taking the SWOT into consideration. Implementing the organisations' strategies does need the "right staff" and the questions to ask may be for example: Do we have the "right staff" / salesmen to expand our market country wide or not?

4.3 Competency of the staff

This is the first step that management should consider after analysis of SWOT. It should determine the competencies that the staff required in order to implement the strategies of the company. Competency is described by Boyatzis (Lecture Notes: Session 6) as "a capacity that exists in a person that leads to behaviour that meets the job demands within the parameter of the organisational environment and that, brings about desired results." It falls under Performance Management as the organisation needs to assess the competencies of its staff and place them in the roles that they are most competent at. A question that may be asked is what happens if the firm discovers that it does not have the staff with the competency that will enable it to achieve it missions and goals. The answer to this question lies in the recruitment and or development of staff.

4.4 Differentiate your staff

After the analysis above, Management needs to "Differentiate" their staff "Differentiating" helps in the determination of the right placement, training and roles that staff should be placed in the company. The building of Talent Management involves segmenting the employees or differentiating staff into the following categories:

Super Keepers


Solid Citizens and


Some commentators categorised them into A,B, and C players. The fourth group are not counted as they are expected to leave voluntarily or the organisation finds a way to let them leave as normally they are either not capable of the tasks / job or they cannot fit into the organisation culture.

I now turn to analysing how the organisations should deal with the three categories by drawing on the suggestions of some of the writers on Talent Management. According the survey conducted by Mckinsy staff and their book "War for Talent", [6] the A players should be retain, develop and get the most out of them while the B players should be acted on decisively or else some of them may fall to the C players. As for the C players, they need to be helped to raise their performance or you remove them from critical areas in the company as they may retard progress and may have an adverse impact on the B or A players.

4.5 Design the Development of your staff

Learning and performance improvement should be an integral part of talent management. Employee training has a long history of ensuring an organisation has a skilled, motivated, and competent workforce. From orientation programs and technical training classes experienced early in one's career, to leadership development and executive coaching, training and development is deeply woven into the fabric of talent management practices. [7] Training and development of staff should make it easy for management to replace staff when the need arises.

Changes in technology were one of the reasons that gave rise to TM. Changes in technology will undoubtedly give rise to a change in the talent that will be required to manage that technology. Recent changes in Information Technology have cause the need for a high demand of IT skilled staff leading to a high turnover in that industry. Therefore there should always be the need to train staff by upgrading their skills. In recent years there has been a rise in Continuous Professional Development (CPD). This helps staff to upgrade themselves and keep abreast with latest developments in their professions.


5.1 Definition of Business Strategy

Business strategy is the second level of strategy concerned with how the organisation should compete successfully in particular markets, how and when. What this means is that after the overall strategy has been defined at the top as to the future direction of the organisation, it is the business level of strategy which should determine how when where and the resources that are required to implement the strategies.

From analysis, management should move on the defining the competencies that the organisation needs and categoriesd them into core, leadership and job specific. The core competences will look at the qualities and behaviours of all employees. This will determine whether they (the staff) fit into the company culture. Leadershp competencies covers the qualities and behaviour of managers and executives while job specifics will look at the staff skills, knowledge and behaviours. These analysis should reveal the needs of the company now and the future and with this management can dedcide to start on buliding a talent reservoir for the future. It is from these reservoirs that the right talent will be drawn from to fill the vacant positions.

5.2 Why Business Strategy

HR is the department that is responsible for the coordination of the human resources needs of the organisation. At Strategic HRM planning, HR is involved in design and implementation of systems based on employment policy and the manpower strategic plan. It should match the HRM policies and use the human resources to achieve the competitive advantage that the organisation needs against its competitors. Here it will be helpful to give a brief definition of completive advantage.

An organisation is said to have a competitive advantage over its rivals if it is able to offer its customers what they need more effectively and better than its competitors.

According to L.A. Berger and Associates Ltd., the HR Manager will always continue to play the following three main strategies:

Identifying, selecting and cultivating Super keepers;

Finding, developing and positioning highly qualified backups for positions critical to their organisation's successful;

Allocating resources for compensation, training and development to employees based on their actual and or potential contribution to organisation success.

According Ed Michael et al, with the current trend on TM, HR Managers will continue to perform the following roles in their organisation. These roles are not new but with the current trend managing talent will require these functions to involve all managers across the organisation and bearing in mind the Business Strategy.

Some of the roles that HR leaders should assume:

Help forge the link between business strategy and talent

Serve as the thought leader in understanding what it takes to attract great talent HR office should help management team clarify and strengthen the company's attractiveness to talent - and should monitor how satisfied managers are through surveys and informal discussions.

Facilitate the talent review and action plans.

Become the architect of the development strategy for top 50 to 100 managers. Should be the adviser to all leaders on their options and best choices for all job openings.


As Ed Michael has said, as the HR Manager is responsible to attract, develop and retain talented people with the support of management to achieve competitive advantage; their role has become much more strategic in nature and they have a role to play in the years ahead, arguably just as that of the Chief Financial Officer (CFO). As the CFO is responsible to harness the finance that will be utilised to acquire the assets, none current assets and other assets for an organisation; so does the HR Manager is responsible to attract the best talent to enable the organisation to gain competitive advantage. This is why Talent Management has become a "Business Strategy".

With the rapid change in technology and the interest developed by researches in recent years; the literature will continue to reveal the importance of this subject. As organisations change their strategies due to the changes in the business environment; Talent Management will also change. What is however certain is that the fight to acquire the best talent in the job market will continue.


Lecture notes: Session 3

Ed Michael et al on "War for Talent"

Journal of Management and Development Vol. 271, 2008 pp5.12

Human Resources Management Review 19 2009 pp304-313

TalentKeepers: Fredric D.Frank,Craig R.Taylor, Human Resource Planning pp33-41