Ten Top Reasons Why Large Companies Fail To Keep Their Best Talent

Having worked in a large international company for many years I can attest to these reasons because I saw it first hand in my 20 years of experience. Needless to say I did preach as did my contemporaries that these issues had to be overcome through strong leadership from the HR team. So here they are:

1. internal and corporate bureaucracy;
2. creating leadership opportunities for top talent to lead projects or teams; 
3. poor performance reviews and where top talent sees and hears poorer performers getting the same reviews;
4. no career discussions taking place at the manager level ;
5. priorities and strategies continues to change taking the focus off talent management;
6. micro management and telling people how to do their job taking away accountability at the talent level;
7. top talent not having the ability to associate or work with other top talent ;
8. not seeing the vision of the talent management process, or should I say no process;
9. management not being open minded where top talent's ideas cannot be heard ;
10. no knowing who the real boss is, bailing out your superiors and not getting credit.

Top talent has to assume some responsibility and it is not all one sided. HR really needs to drive the process, have the accountability and responsibility to manage the process, and work with the CEO and executive team in developing career paths for the top talent. If these reasons are not addresses, YOU lose the competitive edge in retaining your top talent and attracting top talent. 

What are your thoughts?

Peopleclick Authoria – A Perfect Merger or Act of Desperation?

Today, Authoria announce the merger with Peopleclick to create Peopleclick Authoria.  Bedford Funding, the private equity firm that owns Authoria is spending $100 million to acquire and merge the companies.  I’d love to say I had my crystal ball out when we recorded the Bill Kutik Radio Show a few weeks ago and predicted further market consolidation but this wasn’t one of the acquisitions I would have predicted.  Nonetheless, I do believe it is an early indication of what we can expect in 2010 – market consolidation.

The Good News

On paper, the merger makes sense.  It now puts Peopleclick Authoria as the #3 vendor in terms of market share (with Taleo #1 and SuccessFactors #2).  It also brings together one of the deepest talent acquisition vendors (Peopleclick) with one of the most robust talent management vendors (Authoria).  Although Authoria can claim talent acquisition capabilities today (via the acquisition of Hire.com), they are primarily limited to salaried recruiting only.  With Peopleclick, they now add hourly and contingent recruiting, onboarding, EEO/compliance solutions, candidate relationship management (CRM), and vendor management capabilities.  Peopleclick also give Authoria global presence which they really didn’t have previously.   As I recently noted, Peopleclick was newly recognized on the Gartner e-Recruitment Magic Quadrant, a significant accomplishment for the company.

From a pure financial perspective, assuming Peopleclick is a profitable, $60m revenue company, the $100m investment appears to be money well-spent.  Considering Taleo paid $128 million, or a 2.8x multiple of revenue, for Vurv 2 years ago (yes…I understand the market was much different 2 years ago), a 1.6x multiple for Peopleclick makes great financial sense. 

Lastly, Charles Jones, Managing Partner for Bedford Funding, and now Chairman and CEO of the combined company, has a strong track record for acquiring and merging companies.  If you really think about it, Peopleclick Authoria is the merger of 9 companies (6 with Peopleclick and 3 with Authoria) with a total investment over $130 million in venture investment.

The Bad News

The merger of Peopleclick and Authoria appears to be primarily a financially-driven merger.  Private equity firms like Bedford Funding focus on finding undervalued companies, putting in place some operational and financial discipline, and reselling those companies or assets at a premium.

Although they are now have arguably some of the deepest best of breed solutions for talent acquisition and talent management, the two products couldn’t be more different.   Most of Authoria’s products have recently been re-platforming their solution with a J2EE-based architecture (Authoria Communications has yet to be migrated to the new platform).  Authoria 10x, the new platform, has a streamlined and intuitive user experience. 

Conversely, Peopleclick is built on a .NET architecture and the discrete products have gone through varied levels of “modernization”.   Peopleclick’s usability, although intuitive, are process-driven and require significant user interaction.  Over the past few years, Peopleclick has some useful innovations including contact management, onboarding, interview scheduling and social network integration.  The core recruiting management engine though is still dependent on the deliberate complex that still overwhelms most recruiter or user.  What all of this means for either company’s customers is that Peopleclick products and Authoria products look different, act different, deploy different and demand a completely different user experience.  It also mean the distinct architectures will have integration challenges and longer-term cost implications.

No doubt the companies have very complimentary functionality and Peopleclick Authoria will get into many short-lists due to their “RFP-ready” capabilities (“RFP-ready” meaning they can now checkbox the capabilities listed in most generic RFPs out there).  The question, though, is will the depth of capabilities meet the needs of today’s buyer that demands a simplified and unified experience across all talent processes.  The combined Peopleclick Authoria is a technology stew.  Although both product lines are designed with multi-tenancy in mind, I would consider both vendors to be more hosted providers than true SaaS vendors.  Peopleclick Authoria will need to support many product lines, and many versions of those product lines, deployed uniquely across many customers.  Peopleclick Authoria will be challenged to economically support new innovation and deep customer support for all combined products!  The company has yet to share how they intent to integrate the product lines but considering it has taken Authoria 3+ years to re-platform their solutions, it would be a safe bet to assume the products will remain independent on their separate technology stacks and integration will be at the surface only.  While many other vendors will be focused on deepening the unification of their modules, building capability to support emerging “blended” talent management capability such as talent mobility and planning, and innovating in new areas such as social collaboration, Peopleclick Authoria will be focused on the often painful process of blending two companies and the unique complexities of their underlying technology. 

Authoria is getting a great customer base and an annuity stream that I’m sure became very attractive to Bedford (and as was similar with Sumtotal’s private equity buyers).  But with the talent management market continuing to be a replacement market and talent management buyers become increasingly demanding and cost-conscious, it will be no small task to successful managing the combined Peopleclick Authoria.

Will Peopleclick Authoria be good for customers?  Please share your thoughts and comments.

CEOs' Top Priority: Talent Management

In the latest PwC 14th Annual Global CEO Survey of 1,201 business leaders in 69 countries CEOs said that talent management is their top priority up from 3rd place last year. 55% of US respondents said they were going to increase their headcount in 2012. In contrast 51% globally said they would increase headcount. In addition, 75% of US CEOs plan to make major changes to their talent management strategy over the next 12 months.

This response ties into the Kiplinger Letter forecast that the private sector will add 100,000 to 150,000 jobs a month during 2012.

This is hoping that HR executives are on the same wave length as their CEO and that they have already developed their hiring and talent management plans of the coming year.

Is Your Talent Pipeline at Risk? Engaging High Potentials

Organizations that effectively engage employees realize a significant advantage over competitors — including performance gains that lead directly to improved financial results. Without a strategic approach to talent that includes a focus on employee engagement, many companies fail to ensure employees are satisfied in their roles and committed to achieving key strategic goals — risking turnover of key players and the inability to meet overall business objectives. Adding to this challenge is the fact that many disengaged workers are actively seeking new opportunities as the economy grows, while competitors are looking for ways to gain an edge by actively pursuing your high performers.


a reprint from the Human Capital Institute

7 Tall Tales of Talent Management

I was real lucky the other day when a friend of mine gave me a book that was published by Aon in association with the Kellogg School of Management called " Hot Topics Cool Ideas, Insights from the 2010 Client Symposium. 


One of the topics that really caught my eye was the title of this post" 7 Tall Tales of Talent Management" by Mary Kay Vona, Ed.D and Executive VP @ Aon Hewitt. So why this topic you may ask? Well, since we have begun to come out, and I mean slowly out, of this economic recession, employees are restless, not happy, and most of all not overly engaged in their businesses. Why, well all the HR huff and puff with training, incentives that don't mean much, inflated philosophies about people not leaving a company in a recessional period, and a blind eye to really watching the ball has caught many HR professionals off guard with real good talent their companies.


First and foremost she points out that many talent management programs operate from generally accepted assertions that are untested, outdated, or purely anecdotal.  So she outlines the 7 myths as follows:

1. Shifting demographics will create a global talent void - panic you say "we don't have enough people". Reality is the younger generation will fill the void of the Boomers and retirees.Case in point the number of people working past normal retirement age has increased from 12.9% to 16.8% over the past decade.
2. There are no good organically grown HR leaders - well think about that and I will not expound any further. Hogwash I say!!
3. Performance evaluations are the only way to measure talent - "its not the tool stupid, its the talent", need I say more. Think about all the hoops you jump through each year doing evals, talent succession planning, and where does it go? I can tell you from experience that doing a month+ work of work never was acted upon in my 30 years of HR except for a 2 year period in 1999-2000 at a technology think tank and design division. 
4. Reverse mentoring is a crazy idea - mentoring in general has proven to be the differentiators for many, including yours truly.
5. Leaders cannot impact climates of innovation - it is more than a team of thinkers and futurists, it requires big action, that only comes from the top of the organization.
6. Talent assessments have plateaued - well they work believe it or not and I am not contradicting what I said in #3.
7. In the current economy, people are lucky to have jobs...talent is always available - I think she says it best hubris + hyperbole = an unhealthy approach. 

In summary, the evolution of business models, trends, combined with navigating the current recession and employees' changing attitudes towards work represent a complex equation for leaders at all levels. Don't take anything for granted and make sure you keep your prize talent. 

There are many to thank for this besides Vona. Peter Capelli, Alison Overholt, Dave Ulrich, Leonard/Bersin & Associates. 

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Talent Edge 2020: Blueprints for the New Normal

As companies worldwide struggle to move beyond the great recession of 2009, many business leaders are adjusting their talent strategies to meet the shifting demands characterized as the “new normal.”

While the inclination may be strong to revert to strategies that served them well prior to the economic crisis, many executives seem to recognize that the forces shaping future talent needs, such as globalization and an aging workforce, continued to accelerate during the downturn and now require new talent strategies to position their companies for success.

To bring these issues into clearer focus, Forbes Insights and Deloitte launched Talent Edge 2020—following in the path of the 2009-2010 survey series, Managing Talent in a Turbulent Economy. Based on a survey of 334 senior executives, this first Talent Edge 2020 study aims at exploring talent strategies, concerns of global companies, and unfolding employee trends as companies confront a fresh set of challenges that could influence the next decade and beyond. 

To download a pdf of the study, please fill out the following information. The report will appear in a new window. If you experience any trouble, please send an email to: insights@forbes.com.


a reprint from Forbes Insight

How to Keep Your Top Talent

Practically every company these days has some form of program designed to nurture high-potential employees. But a recent study by the Corporate Executive Board demonstrates that nearly 40% of internal job moves made by people identified by their companies as "high potentials" end in failure. Disengagement within this cohort of employees also is remarkable: One in three emerging stars reported feeling disengaged from his or her company. Even more striking, 12% of all the high potentials in the study said they were actively searching for a new job--suggesting that as the economy rebounds and the labor market warms up, organizations may see their most promising employees take flight in large numbers. Why do companies have so much trouble bringing along their next generation of leaders? The Corporate Executive Board's research showed that senior managers make misguided assumptions about these employees and take actions on their behalf that actually hinder their development. When dealing with high-potential employees, firms tend to make six common errors: assuming that all of them are highly engaged, equating current performance with future potential, delegating the management of high potentials down in the organization, shielding promising employees from early derailment, expecting stars to share the pain of organization-wide cutbacks, and failing to link high potentials and their careers to corporate strategy. These mistakes can doom a company's talent investments to irrelevance--or worse.

Here are some things you should do to keep your top talent on track:

1. don't just assume they are engaged - give them stimulating work, a chance to prosper, and recognition or they will walk
2. don't mistake current high performance for future potential - test candidates for ability, engagement, and aspiration
3. don't delegate talent development to line managers - this will limit the talents access to senior members
4. don't shield talent - place talent in live fire roles
5. don't assume top talent will take one for the team - compensate top talent differently and creatively
6. don't keep young leaders in the dark - share strategy with them

How does your talent management program stack up against these areas? If you think your program needs a thorough review you should click on the link above and read this article in detail.

Top Human Resources Issues for the Future

HR has been at the proverbial crossroads for far too long. Walking the fine line between demonstrating strategic value and providing traditional HR services, the industry remains stuck, as the business environment around it grows increasingly global and complex.



While there is no silver bullet, Hewitt believes HR’s survival and success depends on four “bold bets” that not only provide a solid foundation and add organizational value, but also work to expand the influence of HR leaders. While HR’s soft side is still important in today’s post-Enron business world, in order to thrive in tomorrow’s HR environment, companies need to take bold steps to provide holistic, business-focused, data-driven human capital solutions.
 

Four Bold Bets on Where HR Is Headed

Based on Hewitt research, HR must place their bets on four key areas: performing predictive analysis on human capital processes, delivering a steady talent supply, driving organizational performance, and building integrity and trust in the workplace. What makes these bets particularly bold is not so much the focus itself, but the fact that the HR of the future will drive and be held accountable for these areas in their entirety. Rather than reduce the role of HR, these four bets broaden the scope and impact of the role, pushing HR to operate more like a business unto itself—a business focused on driving organizational capability. All four areas bring a holistic approach to addressing human capital challenges with a clear tie to fact-based results and metrics, and produce a more strategic, business-focused HR organization.
 
Human Capital Research and Development



HR of the future is taking the lead in advanced data mining and predictive modeling of human capital processes to identify new business insights. Moving beyond traditional scorecards or dashboards that provide a static snapshot of progress, these HR functions are taking a true R&D approach using systematic, fact-based, and scientific methods, to uncover new relationships and opportunities for human capital to drive organizational performance.
 
Driving the Talent Engine



HR of the future is also redefining and expanding its focus in the area of talent by managing a seamless “human capital supply chain” to ensure the organization’s talent engine is always humming with a ready supply of top talent. This includes the challenge of harnessing the capabilities of a more diverse, global, and virtual workforce. Leading HR organizations are breaking down barriers and taking a holistic approach to managing the sourcing, development, and mobility of their top talent and inventing new approaches to accessing required skills for both today and tomorrow.
 
Organizational High Performance



HR of the future is taking accountability for driving performance at the organization, team, and individual levels. By managing performance as an end-to-end process and focusing on business outcomes, HR has an opportunity to integrate the various components that impact performance into one framework. This means a much more rigorous approach to establishing performance expectations, tying opportunity to potential, and ensuring rewards are tailored by population. This includes newer HR areas such as space management and organizational design that impact employee engagement and productivity.
 
Organizational Stewardship



HR of the future is also assuming a renewed role in building a sense of community, trust, integrity, and even spiritual meaning for the organization. In response to the anxieties of a post-9/11 and Enron world and the growing awareness that people want more meaning out of their work life, more and more companies are striving to build a stronger connection with employees and their communities. What HR brings to the table is not merely employee advocacy experience, but a unique ability to weave together the various components of stewardship, build a stronger bond between employer and employee, and prove the long-term benefits of investing in employees.
 
Pass along your thoughts to me at wgstevens2@gmail.com or kulshaan.singh@hewitt.com at Hewitt

A View From the Top

A good friend of mine has a search company in Atlanta that just put this out in an email. It is so important that I had to share it with our readers. Take heed future HR Execs:

It’s time for HR Leadership to shine!



During the later part of 2009 and in 2010, we have observed that corporate leadership and corporate boards are placing an increasing emphasis on knowing about the depth of talent, experience and competencies within their corporate ranks.


For the first time, boards are viewing leadership as a true enterprise risk. This has been highlighted and perhaps, exacerbated by the current economic situation and by the pressure on corporations to adjust to a new reality while establishing a baseline for growth. Shareholders are demanding enhanced value and are evaluating the depth of their corporate leadership for their ability to execute and deliver.


Now, the human resource function is in the spotlight and CHROs have a true opportunity to step forward. Talent, not access to capital, is at the forefront of this value equation.


Research suggests that the impact and success of talent management programs is largely determined by the continuing importance that is placed on these programs by the CEO. And, without CEO support, talent management fails to gain acceptance or be baked into the corporate culture and performance expectations. That is why that only a small percentage of companies that embark on these programs have met or exceeded expectations.

Now, the tables have turned.



Boards and CEOs are looking to their CHRO to “truly” be the Chief Talent Officer!


Our progressive clients are placing much more emphasis on talent management with recognition that it is a key element of developing and executing any growth strategy. It is “the” critical link that so often is missing or underappreciated. We are seeing this trend among companies of all sizes and dimensions.


Here is what we have learned about succeeding with talent management and a few thoughts to keep in mind.


One size doesn’t fit all.


As talent management programs are long term commitments, moving forward at a pace that is consistent with your organization’s willingness to “own” such a process is essential. Pressing ahead too quickly, oftentimes will lead to stumbling blocks or derailment that will not result in the desired outcome. We recommend a tailored approach specifically geared to your company’s unique requirements, thereby offering the best opportunity for creating a true leadership to value pipeline synching up with your corporate strategy and culture.


From a career point of view, we have conducted several HR searches in the past year. Companies seek strategic insight from their human resource leader. More to the point, our clients seek a CHRO who understands how to attract, evaluate and retain critical talent.


Are you one of those HR executives who possess this experience, mindset and competency?

Thanks you to the Koblenz Group

How To: Implement a Social Media Business Strategy

Sharlyn Lauby is the president of Internal Talent Management (ITM) which specializes in employee training and human resources consulting. She authors a blog at hrbartender.com.

Over the past few months, we’ve talked about whether you should have a social media policy and what should be included in that policy. It only seems logical to discuss the next step in the process, which is what to consider when implementing a social media strategy in your workplace.

Just having a policy isn’t good enough — you need a plan to put it in place. Here are five areas to discuss when implementing a social media strategy.

Determine Your Objective:
Luis Ramos, CEO of The Network, reminds us that creating a social media strategy is a complex exercise because “it includes not only looking inside the organization to establish appropriate practices, usage policies and content parameters, but it also includes looking outside the organization to determine the proper degree of engagement."

Figure out why you’re getting on the social media bandwagon and what you want to accomplish with it. This step is absolutely necessary if you plan to measure ROI or develop your own internal metrics tracking.

When General Motors put together their social media strategy, they had some specific objectives they wanted to accomplish. Christopher Barger, director of global social media at General Motors, outlined the following:

• Become more responsive to people/consumer audiences
• Incorporate audience/consumer feedback into your organization more quickly and effectively than has happened traditionally
• Make your brand a little more “human” to the outside world, and show people the smarts, personality and passion of the people behind your logo
• Increase awareness of the strength of your current product lineup, and provide perspective/accurate information about your company
  

The other benefit of defining objectives is that they can guide the timetable for implementation. I can’t tell you how many times I’ve seen an organization’s list of objectives and knew there was no way they could implement everything at once or in the timeframe they intended. Having well-defined objectives can assist in prioritization and creating the best way to phase-in a social media strategy.


Developing objectives and a timetable could also prompt a conversation about content management. Ramos suggests including in the strategy the position responsible for updating content as well as the update frequency. “Many organizations have grand plans of updating content on a regular basis only to quickly run out of topics, leaving content to become stale. As a best practice, a specific employee is typically assigned to create and manage the company’s social media pages, so he/she can respond to messages and questions within 24 hours.”

Find an Internal Evangelist:
This is a constant source of discussion right now on the Internet, but the bottom line is, some department needs to “own” social media. Lots of departments might be consulted when it comes to decision making, but ultimately someone has to be held accountable for the outcomes.



Which department ultimately gets the responsibility could be dependent upon the size of your organization and corporate culture. For example, Barger says social media at General Motors is “owned within the communications team, reporting up through the Vice President of Communications, who reports directly to the Chairman/CEO. Social media leadership has a seat at the communications leadership table and acts as an integral part of the larger corporate communications function.”


Smaller organizations might not have that amount of structure, so responsibility might simply fall to sales or marketing.

Another option to consider is using external resources (i.e. consultants) for certain aspects of the strategy and internal resources for the rest. Barger explains, “We use internal resources whenever possible; given that two of GM’s main goals are to become more responsive to the public and to incorporate insight back into the organization, these are things we can only effectively do if it is our team who are engaged. We use agency partners for monitoring/measurement, for identifying new opportunities and new influencers for us to reach out to, for video production, and for counsel on tactics/strategy.”

Consider Your Employees:
This is a biggie. Organizations need to understand their employees’ level of knowledge and interest. Offer training. And one noteworthy item for non-profits is to think about your volunteer base. Diane Gomez, public relations manager for the Public Relations Society of America (PRSA), mentions that not only is PRSA staff involved, but volunteers are as well. “This includes monitoring and interacting with members (and nonmembers) who reach out to us via these channels, and is in addition to pushing out information of interest to our members.”


In addition to posting GM’s social media policy, Barger explains several things the company did to convey the company’s approach. “We posted a 45-minute ‘Social Media 101’ interactive training course on the intranet that gives employees the basics on how/why/where to engage in social media. Additionally, we developed a ‘201’ level ‘train-the-trainer’ course that introduces more complete tools and tips. Those who’ve taken this course are authorized to train others within their departments on the basics of social media.

Finally, we have an internal blog, ‘Making Conversation,’ that focuses on sharing lessons we’re learning through social media outreach.” Though she’s the president of a smaller firm, Crystal Kendrick used a similar approach with The Voice of Your Customer. “Our employees are very social media savvy and understand how to technically use the sites. We discussed the spirit of the policy and reviewed examples of ineffective social media policies. Training for our employees focused on the strategic and professional applications of the social media sites. We use ‘key word rich’ content, approved messages and in some cases, scheduled time for posting.”



Gomez added they are encouraging staff to participate in social media on behalf of the organization. “We are looking to establish an overall strategy that departments will follow when deciding when and how to use social media.” I’ve found many companies developing job aids, such as flow charts or decision trees, to help employees determine when and how to respond to blogs and inquiries on other social networking sites.

Check Your Tech:
While most social media doesn’t need a huge technology investment, you should still take a look at the technology capabilities of your company and make sure the system can support the strategy.



As Ramos reminds us, this includes making sure social media applications aren’t hidden behind firewalls. “Before any social media components are engaged, there needs to be an understanding across the organization of the following:

• Who will have access to the sites?
• Are there any firewalls that would prevent access?
• What are the rules about time spent and content posted on the sites?

Listen First:
A lot can be learned by watching others. Don’t be afraid to ask questions on and offline so you can learn more.



Barger encourages companies to remember “that few ideas should be rejected out of hand; not everything is going to work, but in 95% of the cases, even if something doesn’t work there is value to be gained and lessons to be learned from the ‘failure.’ The only exceptions to this rule are efforts that would contradict the basic etiquette and/or rules of social media – transparency, openness, authenticity, and avoiding ‘pure traditional marketing’ plays, etc.”


According to Kendrick, “The first few weeks were a bit hectic.” Like GM, they began to share best practices among employees, identify expert users to follow and recommend connections. She notes, “We matched our target customers to the demographics of our connections and identified gaps in our networks. From there, we began to focus on making connections with persons in target companies, industries and geographic regions and joined groups and lists of industry groups to ensure that we maximized our exposure and business opportunities.”

Conclusion:
During 2010, more companies are expected to explore and engage in social media activities. While some might categorize using a social networking application as easy, that doesn’t mean developing a strategy is simple. Proper planning and execution is the key to integrating social media into your organization.



What are some other key factors in developing a social media strategy? Be sure to post your thoughts and ideas on this blog.

Qualified Employees Still Tough to Find

With a plethora of professionals looking for jobs, one would think hiring managers can take their pick of qualified candidates.

Not so, according to a study of 501 hiring managers byRobert Half and CareerBuilder, which found that 44 percent of resumes presented to hiring managers are submitted by unqualified applicants. The 2009 EDGE Report also found that 47 percent of hiring managers cited under-qualified applicants as their most common hiring challenge.

Two-thirds, or 68 percent, of managers surveyed said they were willing to cut pay, hours and benefits to avoid losing talent through layoffs, while 36 percent said they would rehire people who were laid off.

About 61 percent said they are willing to pay for qualified candidates and would negotiate higher compensation if that meant getting the right person for the job.

While the job market remains ultra competitive, more than half of the managers surveyed said they plan to hire full-time employees in the next year.

Succession Management

A common misconception is that succession management is a human resources driven exercise with little impact on the company. Well, the opposite is true. For those companies that do not have a pure succession plan it has a damaging effect on the long-term impact on the companies bottom line. So where does your company stand on this very important issue especially in today's high impact, fast moving environment of business activity and mobility of great talent. Here are the guideposts and where do you stand:

Level 0 - no succession plan. 21% of companies fall into this category

Level 1 - Replacement Planning - companies only focus on senior level management and an A list of potentials is created. 15% operate at this level

Level 2 - Traditional Succession Planning - Talent review are conducted and plans are put in place. 52% of companies operate like this today

Level 3 - Integrated Succession Planning - A company targets all critical positions at all levels and it is tied to business strategy. 12% operate like this today

Level 4 - Transparent Talent Mobility - no companies operate at this level today where companies completely understand the capabilities and potential of their human capital where decisions are made naturally based on business need and the company as a whole.

So where are you in this talent slide? Bersin & Associates have dealt deeply into this subject and the full text is in this months issue of Workforce.

When Workforce Planning Meets the Talent Shortage Myth

You don’t hear much about the “Talent Shortage Myth” anymore.

Just a year ago, you could hardly turn around without bumping into overhyped media coverage about how the baby-boom generation was going to be retiring en masse and how this was going to create a huge talent shortage for American business. I didn’t buy this notion then, and of course, that kind of BS is completely laughable now given what has happened to the economy.

In fact, a lot of baby boomers want to stay on the job longer these days given what the recession and economic downturn have done to their IRAs, 401(k)s and other retirement accounts. These are people are a lot like me—boomers who want to work as long as they can, or at least until age 70 so they can maximize their Social Security payout.

But in an odd twist, a lot of boomers are now retiring unexpectedly, and “Instead of seeing older workers staying on the job longer as the economy has worsened, the Social Security system is reporting a major surge in early retirement claims that could have implications for the financial security of millions of baby boomers,” according to a story in the Los Angeles Times.

“Since the current federal fiscal year began Oct. 1, [Social Security retirement] claims have been running 25 percent ahead of last year,” the Times story adds, and “that compares with the 15 percent increase that had been projected as the post-World War II generation reaches eligibility for early retirement, according to Stephen C. Goss, chief actuary for the Social Security Administration.”

This shows you just how hard it is getting a fix on where workers’ heads are and what they might do, and it makes long-range workforce planning extremely difficult. In fact, just last December, a CareerBuilder survey found that 60 percent of workers older than 60 said they planned to postpone retirement and stay on the job.

What has changed, of course, is the economy. While I believe the CareerBuilder survey accurately captured the mood of boomers wanting to continue working back in December, it clearly didn’t anticipate the huge plunge in the economy and job losses in the first quarter of 2009. Yes, a lot of older workers want to keep working, but what do you do if you lose your job, can’t find a new one, and have the Social Security retirement option available?

If you are in that kind of fix, you do what most people would do: You take the retirement money and run, even if that’s not what you planned or wanted to do.

Here’s what is going on, the Times story indicates: “Many of the additional retirements are probably laid-off workers who are claiming Social Security early, despite reduced benefits, because they are under immediate financial pressure, Goss and other analysts believe.” And, the story adds, “The ramifications of the trend are profound for the new retirees, their families, the government and other social institutions that may be called upon to help support them. On top of savings ravaged by the stock market decline and the loss of home equity, many retirees now must make do with Social Security benefits reduced by as much as 25 percent if they retire at age 62 instead of 66.”

This just goes to show you how ridiculous it is trying to make broad-brush assumptions—like baby boomers retiring in a huge wave—given how unpredictable the economy can be. And it just shows again that no matter what part you play in the workforce—employer, manager or down-in the-trenches employee—the smart thinking in this economy continues to be pretty simple: Always hope for the best, but make certain that you prepare for the worst.

So what talent drought? Are you one of those that still think this?

What Will Human Resources Look Like in 2010

Earlier this month I indicated that I would identify 5 major changes to HR that will dramatically change how HR professionals do their work. Some are top of mind, some on the cusp of change, and some you have not seen yet. Here they are in no particular order:
Administrivia will reside fully with managers and employees through self service and HRIS systems will be a thing of the past for HR. There will be no such thing as an HR assistant or administrative assistant in HR.
HR as we know it will become a profit center and be measured on profit success.
Entire benefit packages will totally be outsourced to third party vendors and employees will have an a la carte menu. Health care providers will provide light workout equipment that is ergonomically designed to fit in the workplace so workers can get exercise and work simultaneously.
There will be at least 2 senior HR professionals today that will run companies in excess of $100M by 2010.
All data will flow through handhelds on the go rather than through desktops/laptops and the typical HR department as you know it today will not exist.
You will notice that I did not mention talent management or succession planning. Those topics will be dealt with early in 2009.
What do you think of these changes and do you agree or disagree? I would appreciate your opinions. Please send your comments to wgstevens2@gmail.com.