It’s not often senior HR executives find the time to meet in one place, much less share insights, discuss best practices and take stock of their profession. When they do, inevitably there is a dialogue about the origin of their discipline. The focus of such gatherings, however, is increasingly and inevitably where the HR function might be headed — HR is poised at a critical point where, with the right set of management competencies, professionals have the opportunity to create a more strategic role for HR within the enterprise.
No matter from where they hail, or what industry they represent, they agree on this key point: If HR wants to retain its seat at the senior management table, the HR and learning organizations must take their relationship to a new level. Increasingly, both learning and HR organizations are going to be judged not on their ability to simply support the basic needs of the business but to deliver strategic insights that proactively address changes and enable organizations to more effectively source, evaluate and motivate employees in an increasingly turbulent business environment.
Across industries, changing business conditions, demographics and globalization have raised the need to understand and manage the dynamics of talent, from sourcing to resource management and training to recognition systems. To allow HR to focus on these more strategic issues, the next-generation HR organization must promote the use of shared services and employee self-service to move away from its traditional role of answering questions and resolving disputes. Further, the HR organization needs to work more effectively with other vendors in its extended enterprise, providing the tighter coordination that is needed to deliver administrative services. Finally, HR needs to look inward at its own talent, training and learning models to ensure its employees have not only the raw talent but the capabilities, skills, confidence, and access to the training and education needed to ensure a strategic and demand-driven flow of properly enabled talent.
In close partnership with the learning organization, HR has the opportunity to create a nexus for learning within the organization. This new link will serve as the catalyst for the learning function, moving beyond the traditional roles of both HR and learning, to become not only the source for coaching, teaching and mentoring within the organization but a key player in the process of deciding where to deploy core organizational resources — namely, talent — to the greatest business advantage.
Five key forces within the marketplace are driving the most impact and pressure on the HR function to adapt and evolve new management competencies, according to discussions with HR executives. These competencies will enable HR and learning professionals to work together to meet new strategic challenges while simultaneously maintaining a focus on the business needs of their respective organizations.
Globalization
In today’s global economy companies no longer are moving operations simply to benefit from labor arbitrage but also to take advantage of the increasing number of talented professionals around the world. Not only are companies setting up back office or customer centers in India, China, Brazil, Russia and other emerging economies, but in those same locations, they also are setting up research and development centers, as well as other types of high-value, knowledge-intensive capabilities.
Whereas multinational executives might once have hung a world map in their office with pins marking the location of key manufacturing and distribution centers, today’s maps are more likely to hold pins that show the locations of “centers of talent.”
Indeed, these new opportunities have led, in some cases, to a reverse migration of talent. According to a recent article in The Washington Post, it is estimated that in Bangalore, the heart of India’s “Silicon Valley,” between 30,000 and 40,000 expatriates have returned to India in the last decade to work for both multinationals and Indian-based companies.
Thus, companies’ decisions on where to place their centers of operation are increasingly governed by the availability of large numbers of talented professionals in many locations around the world. Whether the catalyst is the decision to open an operational hub in one of these emerging centers of talent, to outsource operations or to acquire an existing presence in the region, the nature of the talent game has changed dramatically.
And as the talent game changes, so does learning. The learning implications of globalization increasingly revolve around the need to rapidly and cost-effectively onboard large numbers of new employees. Key to the success of learning programs of this scope and scale will be enhanced collaboration, which will enable employees to work and learn together in formal and informal ways, across geographies, time zones and cultures.
Collaborative learning programs will ensure employees feel valued, retain and increase knowledge in key career areas, and allow the organization to ensure that its global employee base, linked through learning, is aligned with the company’s goals and needs.
Workforce Demographics
At the same time, the changing workforce demographics in the developed world also are starting to place pressure on finding and holding on to key talent. As an example, a recent U.S. Census study estimates that between 2003 and 2010, the number of workers between the ages of 45-64 will grow by 7.6 million. Similarly, in the European Union, the number of people between the ages of 50 and 64 will increase by 25 percent over the next two decades, while those in the 20- to 29-year bracket will decrease by 20 percent.
As the aging baby boomer generation continues to press toward retirement, companies will find it more difficult to replace these exiting workers with younger workers, who will be drawn from increasingly smaller labor pools. While increased levels of immigration could potentially mitigate some of these challenges, on the whole, companies with operations in the United States, Western Europe and Japan will be looking for innovative ways to replace the talent that will be leaving the organization and preserving critical knowledge before it walks out the door.
The increased competition for an ever-decreasing replacement labor pool, coupled with an incredible knowledge drain, perhaps makes the best argument for increased partnering between learning and HR.
To attract talent and preserve critical organizational business knowledge, businesses are looking to learning leaders for answers and solutions. Through corporate learning initiatives, aging workers can pass along a career’s worth of knowledge in a formalized and planned manner, guided by the strategic needs of the company. Additionally, many workers facing retirement are choosing to continue working, even if they change their jobs.
Organizations can capitalize on this trend in several ways. They can use learning to help workers update their skills, enabling them to continue to contribute and combining their core competencies and long-term expertise with new skills. Organizations might offer these individuals corporate teaching or consulting positions that focus on maintaining the knowledge chain through education and mentoring programs.
Employee Retention
While the supply of talent is strongly influenced by external factors, it is also driven by the ability to retain high performers. Given the changes in workforce demographics, employee mobility and globalization, holding on to valuable employees continues to be a significant concern of HR executives. This is particularly true in developing parts of the world, where high economic growth rates, coupled with limited pools of experienced workers, have caused high levels of turnover similar to those experienced by companies during the late 1990s in North America.
By ensuring employees have access to top-level, career-relevant education programs, HR and learning executives can greatly increase both the ability to retain talent critical to the organization’s future success and engender a feeling of caring and interest in employee development. Indeed, these programs should address not only learning, per se, but the role learning plays in mapping an employee’s overall career progression. As the learning approaches the unique, the individuality of the learning environment becomes more proprietary and a stronger competitive differentiator for the company.
In fact, learning also might be a factor in re-recruiting individuals who have left an organization. HR and the learning function can join forces to stay close to recently departed high performers and develop the learning and career-development opportunities that might persuade them to return to the organization.
Matching Talent and Training to Corporate Strategy
While the supply of available talent influences the choices an organization makes in terms of where and how to source and retain talent, the demand for talent primarily is driven by the organization’s strategic direction. One of the core capabilities deemed critical to the success of HR’s mission is the ability to derive the human capital requirements from the organization’s strategic plan. Many HR organizations, however, often find themselves passive participants in the strategy process, if they are engaged at all.
HR needs to aggressively assert itself into the planning process of the overall strategy-development cycle. Within this planning process, HR needs to work closely with line executives and the corporate strategy group to clearly articulate and address the human capital components of long-term directives.
These components include whether the organization has the talent resource to develop a new initiative in-house, or whether it must consider tapping into the resources of its extended ecosystem. Closely related to this consideration is whether the organization possesses the right mix of knowledge and skills to execute the initiative. Yet another key component is whether the organization’s culture supports the effort and focus required to successfully carry out a long-term directive.
Clearly, factoring human capital components into the planning process also implies the development of corporate training and education programs mapped closely to company strategy needs. It is no longer enough for HR to merely source talent matched to organizational strategic needs — it must go beyond and work with the learning function to design a long-term development program for employees that supports organizational strategic direction.
Balancing Talent Supply and Demand
Organizations in some industries, for example those with substantial call center and retail operations, have long dealt with the need to balance supply and demand within an often part-time or contingent workforce. Learning leaders today, however, must develop and apply these management competencies to the knowledge workforce. For example, how do you optimize the allocation of talent when you have 1,000 software engineers in seven global development centers, working on 50 projects at various points in their life cycles?
First and foremost, you need to know where your skills are. One of the best ways to do this is to develop an expertise taxonomy that employees can use to create and update their personal profiles, typically stored electronically within an organization’s intranet or employee portal.
In doing so, organizations need to consider the appropriate level of detail in developing these profiles, ensuring there is sufficient understanding of employee capabilities without drowning individuals in reams of meaningless categories. Organizations must know whom they can tap for a given project at a given point in its life cycle. Equally as important, learning leaders must understand where skills gaps exist, and they must develop on-demand learning modules that knowledge workers can access when and where they have a window of opportunity to learn.
Changes in business conditions, workforce demographics and the continually evolving landscape of globalization are exerting a profound impact not only on business structure and strategy, but on learning and HR strategies. This environment demands the right management competencies, as well a new level of partnership between learning and HR. These competencies include the ability to onboard large numbers of new employees quickly and effectively, as well as across multiple geographies.
They also include the ability to provide learning to a multigenerational workforce, including programs that meet the needs of a new generation of workers replacing retirees, and programs that upgrade the skills and leverage the knowledge of those who choose to continue working. New learning management competencies include thinking and acting not only in terms of a comprehensive learning program, but a comprehensive career map to foster loyalty and retain critical talent. Additionally, they include the ability to match talent and training to organizational strategy and to apply that talent dynamically and efficiently to organizational initiatives.
More than ever before, HR and learning professionals are in a unique position to extend their reach throughout the organization as they become true and valued members of the corporate leadership team.
Eric Lesser is an associate partner for IBM’s Institute for Business Value. Lesser’s research interests include knowledge strategy, communities of practice, social capital and the use of customer knowledge in organizations. He can be reached at elesser@clomedia.com.
