HR can show the way

Future star performers do exist within organisations. Nic Paton talks to two employers that have managed to find them

You’re running a major food retailer and, while the market is tough, everything is going relatively sweetly. To keep on top of things you’re rightly focused on succession planning. You want, in particular, to hire or promote people who have served their time, know the grocery business inside and out and who have already been successful in their particular function.

The only problem, argues Maria Yapp, managing director of business psychologists Xancam, is that by doing this you may actually be setting yourself up for a fall.

“I worked with an organisation just like this a few years ago. The people that were good on the grocery side rose to the top. But it was clear that food retailing was going beyond food, so they needed not just to be reliant on traditional grocery skills,” she says. The organisation accepted this, developed people with the relevant skills and is now competing effectively in both the leisure and non-food sectors, says Yapp.

Talent management is never easy, but too many organisations make it even harder for themselves by overlooking or failing to exploit the talent they already have. In April, for instance, the Chartered Institute of Personnel and Development, suggested that workers were consistently ‘under-managed’, leading to a lack of engagement and a shortage of leaders.

Research carried out for Personnel Today in March by the Cranfield School of Management showed the scale of the frustration felt by many workers, with half of UK managers planning to change jobs in the next two years.

And a study last December by consultants Fairplace found that two-thirds of organisations had not even allocated a specific budget for the retention of their most talented employees.

Identify the talent

The first challenge, argues Yapp, is simply how to identify the hidden talent lurking within your organisation.

People are often recruited to a specific job, they do it, and they may even do it well; but how do you actually tell if they have the potential to be the manager or executive of the future? And at an organisational level, how can you tell if you are too prepared to promote people, but rarely across function, or if you have a culture of leaving adequate performers where they are rather than asking whether they could do even better elsewhere?

Xancam has created a series of psychometric and assessment models that organisations can use to create key lead indicators to help them distinguish between current levels of performance and future potential.

One organisation that has been using this technique to build a pipeline of future business leaders is broadband and media company Telewest.

The UK-based company, which employs around 9,500 people, has seen a vast improvement in retention levels and also benefits in terms of productivity, communications and employee satisfaction levels, says organisation development director Sin Evans.

Its initiative started two years ago when the networking, technology and IT division wanted to find out whether 16 candidates it had identified as being ‘high potential’ were indeed just that.

“Out of the 16, only two came out as having high potential,” Evans recalls. “So we put them all into a development programme designed to target areas of weakness. They have now been together for 18 months and virtually everyone has now either been promoted or given an increased role.”

Of the original 16, two have since left the business, a statistic that in a traditionally fast-moving and high-turnover industry is much lower than expected.

The success of the approach prompted Telewest to extend the programme to all directors and heads of functions in the division – around 45 people – and then, from last October, across the company, covering another 105 people.

“We have kept all the high potentials together so there is increased learning, and there is also self-managed learning,” she explains.

As a result, there have been some “difficult conversations” with people who have not done particularly well, she says, but not one of those going through the programme has so far left the business.

This, Evans believes, is partly because they now recognise that time and effort is being put into their future development, and this encourages them to stay and, hopefully, grow with the company.

In IT-led companies, such as Telewest, there is often a problem that managers may have strong technical skills but be less able when it comes to soft skills such as people management. It therefore focused on developing the emotional intelligence of managers, the astuteness of their relationships and how they manage people, says Evans.

Consistent approach

The original cohort of managers is now being reassessed through a new pilot programme, she adds.

One benefit has been in getting a consistent approach to management development.

“We are giving people a clear picture of their strengths, weaknesses and development areas,” says Evans.

“People have been networking with others from different areas of the business. In the past people have often been stuck in their comfort zones or their silos. Now the light bulb has gone on,” she says.

And the HR function has been central to the whole process. “It has been vital in communicating the process up front, although it has also been important to get buy-in from the senior team – we have had some senior directors go through it too,” she explains.

“HR has been the assessor, giving feedback to the individuals. We wanted to keep that in-house because the relationships were already there,” adds Evans.

Another firm that believes it has benefited from this approach is IT company Fujitsu, which last year launched an ‘account manager academy’ to help it identify, groom and develop future talent.

The company employs 17,000 workers across Europe, the Middle East and Africa – 10,000 of them in the UK. The role of account manager is a pivotal one, and is often a springboard into general management positions. Yet traditionally, the account managers who normally run the company’s multi-million pound accounts have largely been recruited externally, and are often people from a relatively narrow sales and marketing background.

This time, says people development manager Rachel Rose, the company, which was looking to appoint 10 account managers, wanted to make a specific effort to search out untapped or unrecognised talent from within the organisation.

“We sent a note around the organisation via the intranet, asking if anyone was interested in being considered, that we were recruiting people into the role and looking for people with potential,” she explains.

Rigorous assessment

Some 300 candidates applied, who were whittled down to 260 through a self-assessment process. Following this, candidates were asked to bring forward a senior-level sponsor to argue on their behalf and explain their potential capabilities.

From there, the numbers were reduced to about 40, who then went through a rigorous assessment process.

“The 10 came from right across the board – sales and procurement, technology and service delivery – from all sorts of different functions,” says Rose.

Each successful candidate was then set up with an individual development plan and they are now regularly evaluated and have ongoing feedback sessions.

While it is too early to get a clear sense of what long-term difference recruiting people this way will make to the business, some benefits are already starting to emerge, says Ian Williams, Fujitsu’s head of organisation and people development.

“We are already seeing some individuals turning accounts around,” he says.

On a wider level, employees now see Fujitsu as an organisation where they can build their career.

“You might sit in an obscure part of the organisation but you know you can be spotted or put yourself forward,” says Rose. “It is saying to employees that you do not just have to have the same career path.”

The company is extending the academy to other areas of the business – specifically HR and sales – although some of the methods of selection may be tweaked, says Williams.

Even where candidates are not successful, there can be benefits, he adds. Simply going through the process helps employees better understand where they want to go and what skills they need. It also helps managers identify people who may still be talented, but not necessarily in the direction of the role they applied for.

As a function, HR needs to sit at the heart of this talent-spotting process, stresses Williams. “It needs to be an HR-driven initiative. But for it to fly within the business it does need sponsorship from the top level,” he adds.

HR also has a central role to play in presenting the argument effectively and showing the board just what the business benefits are likely to be.

Similarly, HR needs to be the primary mover when it comes to communicating the initiative at all levels – to the board, to line and senior managers and to employees themselves, suggests Rose.

What HR should look for

Xancam’s Maria Yapp suggests that organisations should look for individuals with the following attributes:

Emotional agility – an ability to influence with ease and sensitivity, a strong emphasis on ‘winning’, achieving through teams and partnering
Strategic agility – ability to see the bigger picture, thinking beyond current business cycles and being commercially analytical
Learning and growing agility – a hunger for learning and growth, a constant desire to stretch self or team and always looking to move beyond the comfort zone

How psychometrics can help

Using psychometric testing and assessment techniques to identify talent within an organisation is currently at the cutting edge of business psychology, argues Kevin Kingsland, chairman of the Association of Business Psychologists.

But it is by no means the only innovative thinking surrounding talent management at the moment, he suggests.

There is a drive to encourage organisations to take a wider, systemic approach to talent management, focusing on organisational structures rather than individuals alone, he argues.

“The notion of leadership coming from individuals is being modified. We are trying to look at the talent within teams and groups as well as within individuals,” says Kingsland.

Organisations are being urged to look at individual needs as much as performance as a way of gauging current and future potential, he argues.

“Often people feel diminished and they want to leave an organisation, even places that are thought of as good employers. But if their goals are being met they feel enhanced,” he says. “So it’s looking at how you release the talent around you.”

How knowledge is generated, used and retained within an organisation is another vibrant area of debate at the moment,
he adds.

For the future, the impact of the West’s ageing population, and competition from the younger populations of China and India, are likely to have a major impact on the way businesses think about and manage their talent, he predicts.

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