The two most common questions clients pose to me as a workforce planner are what is best practice and how can we get best engage in the war for talent? Ironically these two questions are deeply connected yet neither need have any relevance in today’s business world.
Let’s look at the term ‘best practice’ in terms of workforce design. What does it actually represent? It involves looking to those who are deemed industry leaders and developing workforce strategies that mimic theirs. Often, what we fail to realise is that these workforce strategies have been developed to align to the organisational strategies of these industry leaders. Hence, following what others are doing is actually developing a workforce strategy for our business based on the organisational strategy of another. Furthermore, the notion of ‘best practice’ often takes an academic lens and is not truly embodied within the context of real business opportunities and/or threats.
The economic impact of numerous organisations following ‘best practice’ cumulates in what we refer to today as ‘the war for talent’. The war for talent (first coined by McKinsey in 1997) is essentially a buzz term that has gathered momentum over time and has become a ‘scapegoat’ for poor planning processes and recruitment outcomes. It represents a false economy born from large numbers of organisations with fundamentally similar workforce strategies, competing for a relatively fixed pool of ‘ready now’ resources. The term ‘best practice’ is largely to blame for this false economy. Following the same set of processes and practices as other organisations leaves our workforce strategy fundamentally the same as that of our competitors. Basic economics tells us that high demand and low supply forces prices (salaries) up and places the balance of power firmly in the hands of talented job seekers.
Further compounding this issue is the fact that as ‘people’ we think in terms of ‘people’. The obvious solution to most workforce related problems is, you guessed it, ‘people’. If we can shift our mindset towards thinking in terms of ‘capability’ not ‘people’ we open up the options around sourcing capabilities far beyond traditional recruitment channels. Attached is a link to an article from the Australian Financial Review detailing how Newcrest Mining Limited CIO, Gavin Wood used a capability based approach to revamp his IT strategy by developing a set of reusable capabilities to support business outcomes. Through taking a capability based approach, Newcrest has been able to build a multi-faceted workforce strategy that doesn’t rely heavily on engaging in the so called ‘war for talent’. The strategy acknowledges trends like the gig economy and works with these emerging trends to borrow capabilities on a needs-be basis. Approaches such as this aren’t limited to the technology space, they are highly relevant across all business disciplines.
Through taking a capability based approach to strategic workforce planning, we can reduce our reliance on external recruitment to satisfy future workforce demand and significantly reduce the pressure on our internal recruitment teams. Relying exclusively on sourcing ‘people’ (permanent employees) to satisfy workforce demand is very much a ‘shot in the dark’ style strategy containing no certainty, no predictability and too much variability. Imagine a world where organisations knew with confidence the exact capability they required in order to deliver against their strategic objectives and, better still, had all of that capability on hand! Wouldn’t we sleep better at night knowing we could avoid the ‘war fortalent’ altogether?
In addition to providing a variety of alternatives to external recruitment, understanding an organisation’s enterprise capabilities also enhances talent planning and development as well as succession planning. Furthermore, enterprise capability mapping helps mitigate strategic risks through the alignment or workforce development initiatives to future capability requirements. The ability to understand future capability requirements and quantify the gaps is an incredibly powerful asset representing the cornerstone of contemporary workforce planning and design.
The journey towards greater workforce certainty through taking a capability based approach to strategic workforce planning starts with developing an understanding of enterprise capabilities – the capabilities responsible for implementing strategic objectives. Once these are understood, we can develop a map of where we currently sit (through a current state capability mapping activity) and a capability roadmap around sourcing new capabilities or enhancing existing ones can be developed.
The ‘war for talent’ is real…. but only because we, as a ‘best practice’ focused economy make it real. It’s merely a bubble and by taking a capability based approach to managing our organisational resources, we can burst it. Recruiting will always need to form part of our workforce strategies, organisational growth and a healthy level of turnover will continue to demand it, but it should form just that – a part.
For further information on taking a capability based approach to strategic workforce planning please contact the workforce planning institute at firstname.lastname@example.org or investigate our Enterprise Capability Mapping training certification here.