As I sit back after a long career in the corporate world covering the Middle East, Africa, APAC and India I see the transformation that has taken place in the talent acquisition function. Being an advisor and consultant to various high profile organizations I am privy to a lot of thoughts that fly around the board rooms. One that I am picking up today is the challenge that businesses face with regards to their talent. An ongoing challenge to say the least. Something that I have always advocated (and tried to practice)… Strategic approach to long term investments and integrating financial results into HR activities!
We have all prioritized this and have made progress in some spheres, but suffice to say – we couldn’t do enough. As a starting point, I relooked at the talent acquisition process and asked, how we could measure this simple activity through revenue contribution lens. Driven by the need for of consistency, cost savings and cultural fit, many large businesses have adopted a COE model for recruiting.
While the COEs have created an edge for organizations, and most organizations have realized a distinct advantage in the pursuit of great talent. However, the risk remains that they will gradually lower the quality of hire over time- whether it is recruiting future leaders or hiring someone to do the job. COEs have also pushed HR generalists further away from the talent market, and are happy with the KPIS being exceeded, mostly cost/time focused.
At a time when business leaders and owners continually reiterate how their people are the greatest asset, why do HR leaders continue to focus on cost? Well… the business algorithms, the planning process, and the so called “overheads” line of thinking will not allow HR to think any differently. HR systems have been very slow to evolve, predictive analytics is gaining momentum but far from delivering results currently. Talent assessment tools have also been a spate of experiments, with line managers constantly challenging validity, and HR struggling with new tools every other year.
So what should be the line of thinking in the current scheme of things? Let’s take recruitment process as an example…
Quickly study your top 20-25% performers hired in the last 3 years. Analyze the data to get the following:
So we can see that measuring these aspects will definitely have a value oriented approach. With higher sophistication of analytics, this will have a direct line of sight to revenue.
Agreed, that it takes a lot more, such as areas like, talent development framework in the company, manager quality, work environment, Pay and benefits etc., for the entire gamut to work. Taking just the recruitment process as an example HR should strive to take this approach if it wants to change the conversation on talent acquisition and, ultimately, shift its role from support function and cost manager to strategic partner and revenue generator.
This change in approach requires heads of HR to invest in developing their team’s financial and commercial acumen. They will need to invest in getting analytics resources onboard, invest in HR technologies, and most importantly change the SLAs with their current talent acquisition COEs to focus more on the KPIs above.
In closing, I would also urge HR leaders to strengthen external orientations. Get connected to potential talent, invest time with external service providers and constantly look out for newer developments in the field of talent metrics.
- Published on 24th July by Anurag Kumar, MD at Mindfield Resources, Former CHRO at PepsiCo MEA