The Project Management Institute released its annual global outlook for the project management industry, the Pulse of the Profession. Over 1,000 project professionals participated in the research, which concludes with identifying five areas of focus for 2012:
- Talent development
- Tight economic conditions
- Shifting market conditions
- Organizational agility
- Project benefits realization
When examining the list, two of the focus areas are external to organizations and three are internal. When contemplating the two external factors, tight economic conditions and shifting market conditions, many organizations operate in a reactionary mode as the global influence expands and contracts. Of the three internal factors, talent development, organizational agility, and project benefits realization, it is talent management that could be a key success factor influencing all other focus areas.
Talent management is the process of managing human resources from the strategic perspective. There are dozens of talent management models but most include the processes of acquiring, retaining, developing, and assessing human resources as an investment for future competitive advantage.
Before making human capital investment decisions, organizations often need to see the quantifiable return on investment. One way to quantify the investment is by considering monies saved. It is estimated that the average costs to replace a worker are anywhere from 25 to 200 percent of annual salaries. For a $60,000 per year employee, the cost to replace him or her is somewhere between $15,000 to a staggering $120,000. Might it be more cost effective to develop existing talent rather than replacing or hiring new talent?
While talent is on the short list of the most critical success factors, having a formal ‘Project Manager Competency’ development process is declining. Thinking back to the five areas of focus, talent management is the only one that can be completely controlled by the organization. The global economic unrest does not directly influence the success of an organization’s talent management plan. Organizational agility and project benefits realization are only more fuel for ‘why’ talent management is a critical strategic imperative.
Could talent management incentives shift us back to mutual loyalty? My father had an expectation that he would work for one company his entire life. His organization considered him a strategic asset and provided incentives to retain his talent (a career ladder to progress, salary increases, and a pension). But a noticeable shift emerged in the mid-80s as organizations’ strategies changed, as evidenced by traditional pensions transitioned to defined contribution plans – the 401(k). Add to this scenario the current workforce philosophy in which changing jobs is considered career progression rather than a black mark. The blend of organizational benefits pull back and lack of work force loyalty could be contributing to the costly talent drain that we are seeing today.
From your leadership perspective, could Talent Management be THE ‘manageable’ a missing link?
