The document discusses challenges in filling critical roles through external hiring. It notes that while overall unemployment is high, there are shortages for critical roles that require specific skills. External hiring for these roles is costly, can lower productivity and retention, and risks losing top performers who lack development opportunities. Instead, the document argues companies should focus on internal development and mobility as a default, and improve talent data, job definitions, matching tools, and overall strategy to better source talent internally for critical roles.
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3. EXECUTIVE SUMMARY
âș High unemployment is a myth (when hiring for critical roles)
âș Skill shortages for critical roles are bad and getting worse
âș âHiringâ as a default approach is mostly bad
â It costs more.
â It results in lower productivity and performance.
â It hurts engagement and turnover for hi-pos.
âș We need to switch the model to development and mobility first.
âș We need better talent intelligence, job definitions, and matching
tools.
âș But mostly we need a strategy.
4. POLL
âș Are you having difficulty filling critical roles?
âș Yes
âș No
5. THE âHIGH UNEMPLOYMENTâ MYTH
Education Level (March, 2012) Unemployment Rate
Less than high school diploma 12.9
High school diploma 8.3
Associateâs degree or some college 7.3
Bachelorâs or higher 4.2
Masterâs (as of May 2011) 3.6
Doctorateâs or Professional (as of May 2011) 2.4
When it comes to critical roles, which group are you hiring from?
http://www.bls.gov/news.release/empsit.t04.htm
http://www.bls.gov/emp/ep_chart_001.htm
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6. THE CHALLENGE OF CRITICAL ROLES
The R&D shortage is particularly
acute in industries where product
innovation is critical. Among the
Technology/Media/Telecom
companies surveyed, 40% predict a
severe shortage of R&D talent,
while 39% of Consumer/ Industrial
Products companies surveyed and
37% of Life Sciences/Health Care
companies surveyed foresee
shortages in this area.
Talent Edge 2020: Blueprints for
the new normal, December 2010,
Deloitte.
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7. THE CHALLENGE OF CRITICAL ROLES
The R&D shortage is particularly
acute in industries where product
innovation is critical. Among the
Technology/Media/Telecom
companies surveyed, 40% predict a
severe shortage of R&D talent,
while 39% of Consumer/ Industrial
Products companies surveyed and
37% of Life Sciences/Health Care
companies surveyed foresee
shortages in this area.
Talent Edge 2020: Blueprints for
the new normal, December 2010,
Deloitte.
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8. OTHER PERSPECTIVES
The 2011/2012 Talent Management and Rewards Study, North America, Towers Watson
10 Hardest Roles to Fill in the US: 8 Hardest Roles to Fill in the UK:
1. Skilled Trades 1. Finance and Legal Professionals
2. Sales Representatives 2. Customer Service
3. Engineers 3. Technical and IT
4. Drivers 4. Marketing Professionals
5. Accounting & Finance Staff 5. Sales Professionals
6. IT Staff 6. Production Staff
7. Management/Executives 7. R&D
8. Teachers 8. Administrators
9. Secretaries/Administrative Assistants UK Critical Talent Pipelines, 2012, Taleo
10. Machinist/Machine Operator
Talent Shortage Survey, 2011, ManpowerGroup.
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9. AND THE FUTURE LOOKS WORSE
âș Georgetown University Center on Education and the Workforce
on shortfall of college grads in 2018
3,000,000
âș Accenture study from 2006 showed that STEM enrollments
would need to increase by
to meet demand 20-30% between 2006-2016
Instead, enrollments have GONE DOWN.
10. POLL QUESTION
âș How do you typically fill critical roles?
âș Mostly external hires
âș Mostly internal hires
âș A pretty even mix of each
11. CHALLENGES IN HIRING EXTERNALLY FOR CRITICAL ROLES
âș Cost
âș Time
âș Retention
âș Engagement
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12. EXTERNAL HIRE CHALLENGES: COST AND TIME
âș External hires cost more
â Critical roles are usually industry-wide, not company specific
â Thus, there is usually high demand for limited resources
â Critical roles are critical for a reason â unique skills, high need
â Scarcity + high demand = high cost
â âUnknownsâ in external hiring = more focus on âobservable
characteristicsâ such as education / experience = ïĄ pay
âș Scarcity also often means head hunters which adds more cost
âș Scarcity also means longer time to hire, adding opportunity cost
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13. EXTERNAL HIRE CHALLENGES: COST AND TIME
âș External hires cost more
â Critical roles are usually industry-wide, not company specific
â Thus, there is usually high demand for limited resources
â Critical roles are critical for a reason â unique skills, high need
â Scarcity + high demand = high cost
â âUnknownsâ in external hiring = more focus on âobservable
characteristicsâ such as education / experience = ïĄ pay
âș Scarcity also often means head hunters which adds more cost
âș Scarcity also means longer time to hire, adding opportunity cost
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14. EXTERNAL HIRE CHALLENGES:
RETENTION, PRODUCTIVITY, AND ENGAGEMENT
âș External hires arenât as productive as internal hires; new
research suggests that it takes 2 years to get âup to speedâ
âș External hires average shorter tenures than internal hires
âș External hires average lower performance reviews
âș Hiring outside = risk to top performers and high potentials
â âLack of career developmentâ is #1 reason for dysfunctional
turnover
â âTraining and development opportunityâ is #1 driver of
employee engagement
â âMore opportunities to do what I do bestâ is #1 driver of
employee engagement
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15. EXTERNAL HIRE CHALLENGES:
RETENTION, PRODUCTIVITY, AND ENGAGEMENT
âș External hires arenât as productive as internal hires; new
research suggests that it takes 2 years to get âup to speedâ
âș External hires average shorter tenures than internal hires
âș External hires average lower performance reviews
âș Hiring outside = risk to top performers and high potentials
â âLack of career developmentâ is #1 reason for dysfunctional
turnover
â âTraining and development opportunityâ is #1 driver of
employee engagement
â âMore opportunities to do what I do bestâ is #1 driver of
employee engagement
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17. YET WE KNOW NEXT TO NOTHING ABOUT OUR TALENT:
PERFORMANCE MANAGEMENT AND COMPENSATION
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18. YET WE KNOW NEXT TO NOTHING ABOUT OUR TALENT:
PERFORMANCE MANAGEMENT AND COMPENSATION
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19. YET WE KNOW NEXT TO NOTHING ABOUT OUR TALENT:
SUCCESSION AND TALENT MOBILITY
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20. YET WE KNOW NEXT TO NOTHING ABOUT OUR TALENT:
SUCCESSION AND TALENT MOBILITY
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21. YET WE KNOW NEXT TO NOTHING ABOUT OUR TALENT:
TOP PERFORMER AND HI-PO DATA IS UGLY
âș 80% of companies donât know who is a flight risk.
âș 78% of companies donât know who is on a succession plan.
âș 80% of companies donât know who has a career path.
âș 65% of companies donât know much about who theyâre
retaining.
âș 84% of companies donât if their development plans are working.
âș 65% of companies donât know much about Hi-Poâs.
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22. ADDRESSING THE PROBLEM
External Hires Internal Hires
âą Fresh eyes and âą Anytime the
perspectives other criteria
âą High growth, new donât applyâŠ
territories, new âą In other words,
strategic this should be
directions the âdefaultâ
model
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26. YOUR DEFAULT HIRING FLOWCHART
Catalog
External
Talent
Talent Development
Catalog Profiles Plans
Internal
Talent
Potential Green light
Match Assess Gaps
Candidates Candidates
Update
Catalog Job Requirements
Requirements Job Roles
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27. YOUR DEFAULT HIRING FLOWCHART
Catalog
External
Talent
Talent Development
Catalog Profiles Plans
Internal
Talent
Potential Green light
Match Assess Gaps
Candidates Candidates
Update
Catalog Job Requirements
Requirements Job Roles
#TaleoTalent
28. YOUR DEFAULT HIRING FLOWCHART
Catalog
External
Talent
Talent Development
Catalog Profiles Plans
Internal
Talent
Critical
Potential Green light Talent
Match Assess Gaps Add
Candidates Candidates Pipelines
Update
Catalog Job Requirements
Requirements Job Roles
#TaleoTalent
29. Catalog
ADDRESS YOUR TALENT INTELLIGENCE GAPS Internal
Talent
âș Where are your skill and competency gaps?
âș Do you have robust talent data for your team?
â Pre-hire experience, job roles
â Skills, capabilities, competencies
â Self-identified skills developed in personal life
â Career aspirations and related gaps
â Learning and development plans
â Crowd-sourced assessment of potential, capabilities, fit, etcâŠ
â Current and automatically updated talent data
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30. Catalog Job
ADDRESS YOUR JOB ROLE GAPS Requirements
âș Have you defined requirements for each job?
âș Do you have job families?
âș Can you identify potential career paths based on competencies,
capabilities, experience?
âș For critical roles, have you identified longer-term competency
development strategies?
â Required experience and levels of mastery
â Education and formal knowledge requirements
â Bridge roles or âstepping stoneâ roles that provide experience
â Assessment models
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31. Development
DEVELOPING YOUR TALENT Assess Gaps
Plans
âș Career Aspirations
âș Skill Gap Assessment
âș Action Learning
âș Stretch Goals and Assignments
âș Talent Mobility
âș Multi-stage Development and Competency Model
âș Mentor / Mentee Models
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32. Update
UPDATE REQUIREMENTS Assess Gaps
Requirements
âș Is the job definition static or dynamic?
âș How much âwiggle roomâ is there to rethink work assignments
and responsibilities to overcome gaps?
âș Do requirements change over time in response to changing
competitive landscape, strategy, new opportunities or threats?
âș Job roles and related requirements are a means to an end
â Reflection of âbestâ way to organize work, not the âonlyâ way
â Often better to rethink work assignments than lose a top
performer or hi-po for lack of internal opportunities
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33. MATCHING â NOT DEEP ENOUGH Match
âș Goal is not to âhire,â but to match talent to requirements
âș Yet we donât know the basics
48%
say that their skills go unnoticed
feel that their work history &
experiences are not leveraged by
their employer
75%
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34. MATCHING â NOT SOCIAL ENOUGH Match
âș Co-workers know talent best, yet arenât involved in matching
Professional & work Professional & work
capabilities aspirations / ambitions
None of the
Other None of the Other above
1% above 1% 6%
Donât know 3% My family / Donât know My family /
5% partner 5% partner
21% 43%
My line manager
My line manager 13%
22%
My friends HR software /
outside of work systems
4% 1%
HR software /
systems
1% My colleagues
My colleagues and peers
and peers 22% My friends
43% outside of work
9%
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40. WRAP UP
âș High unemployment is a myth (when hiring for critical roles)
âș Skill shortages for critical roles is bad and getting worse
âș âHiringâ as a default approach is mostly bad
â It costs more.
â It results in lower productivity and performance.
â It hurts engagement and turnover for hi-pos.
âș We need to switch the model to development and mobility first.
âș We need better talent intelligence, job definitions, and matching
tools.
âș But mostly we need a strategy.