schneiderism

Despite whatever you believe to be our immediate economic reality, it is a good time to be young, smart, and focused. Companies struggle to navigate what is really a seller’s market for “human capital,” and attract the next wave of talent into their fold. The problem? There are several other companies fighting to recruit the same individual. A very successful public company in the consumer lawn care space that I know well admits actively raiding the talent pools of the medical technology companies in the area. Med tech to lawn care? Why not! The thing is, these talent pools are also targeted by financial services firms, retail giants, and others. They’re all competing openly for the same talent. This is a really good case study in supply and demand. You don’t have to look far to realize this is playing out everywhere. Often times, takeover bids between companies are as much about expanding talent as they are about increasing market share. Talent is perhaps the most important weapon in the battle for market success.

And this is nothing new. Look back ten years and business magazines were full of articles about the looming, and now pressing, “War for Talent.” McKinsey released a study back in 1998 that surveyed 6,000 executives in 77 companies which consistently identified that the single most important corporate resource over the next 20 years as talent, define in the study as “smart, sophisticated businesspeople who are technologically literate, globally astute, and operationally agile.” Sounds familiar. Not much has changed in ten years. What’s more, the study goes on to tell us that even as the demand for talent goes up, the supply of it will be going down. Supply and demand in action.

What’s a company to do? Get aggressive, really aggressive. Focus resources on talent acquisition that are commensurate with those focused on market expansion. The reality is that the former will ultimately beget the latter. As a best practice, companies need to be obsessed with ensuring that they are staffed by the best possible people, from the top on down. This is entirely a quality proposition, and it means always having your finger on the pulse of available talent, regardless of the real need for people. It means having an organized HR team that has an effective talent profile, and relentlessly tests for this profile. It means ensuring that your organization is a recruiting machine, that your people, your environment, and your package are not only competitive… they’re compelling. And relevant. And tailored to the people you seek to attract. Stop and think about your company for a moment, and think about your company in two years if a focused plan to attract talent was deployed. I suspect we are talking about two very different companies.

The McKinsey study also revealed ten years ago that only 60% of the corporate officers interviewed said that they were able to pursue most of their growth opportunities. These corporate leaders said that they had good ideas, and that they had the budgets to pursue these ideas, but they lacked the right people to execute. They reported that they did not have enough talented people to pursue their good ideas, regardless of budgetary abundance. They were “talent-constrained.” Ten years ago the implications of this were huge, and was a part of the feeding frenzy that became the .com debacle. Today these implications are staggering and I have yet to find a similar analysis regarding the relationship between growth and talent, but I would surmise that we are facing similar if not more critical deficiencies in growth as it relates to the talent needed to create that growth, and the lack thereof.