The issue of talent management has climbed steadily up the corporate agenda in recent years. Now, as business leaders prepare to take advantage of an economic upswing, the urgency with which companies must find the right talent with the right skills to execute on growth strategies is becoming ever more pressing.
Despite the importance that senior managers are placing on their business’s ability to get the best people in the right roles at the right time, many companies are struggling to deliver on this objective. This is due to increased complexity in both their talent needs and in navigating the labour market. Indeed, according to recent research undertaken by The Corporate Executive Board’s Corporate Leadership Council, 70% of recruiters report working on requisitions where requirements change substantially. Also, while the number of applicants has increased by 128% since 2007, 83% of recruiters report that fewer than half of applicants are have the right qualifications.
Navigating this increased complexity in talent needs and candidate volume has been made even more challenging given the budget and staffing cuts that most recruiting departments have experienced during the downturn. More than 70%of recruiting organisations expect recruiting budgets to be at or below 2009 levels in 2011. At the same, time nearly 60% of organisations expect recruiter requisition loads to increase.
Part of the solution lies in identifying what the best recruiting organisations look like and how they are getting the right candidate in the right role more quickly. Line managers today continue to view in-house recruiters in the context of “order takers” rather than trusted advisers. However, CLC Recruiting’s latest research has found that the most effective recruiters are better characterised as “Talent Advisers”, demonstrating their acute knowledge of both the strategic needs of their organisation and the nature of the external labour market. This in turn gives them greater influence over hiring decisions and enables them to develop the right pipeline of talent.
One of the areas where HR needs to apply a longer-term strategy to attract talent is in the creation and delivery of the organisation’s Employment Value Proposition (EVP).
The EVP, a collection of attributes perceived by professionals to be the value gained from employment with a specific organisation, directly impacts on that organisation’s ability to attract candidates and retain employees. These attributes range from compensation, health benefits, holiday entitlement, the organisation’s culture and the quality of managers and colleagues.
Developing an EVP that resonates with a desired target segment of the labour pool carries two distinct advantages. Firstly, it can strengthen the corporate hand when negotiating pay, with our research indicating that organisations in Europe with a competitive EVP are paying 8% lower salary premiums to persuade candidates to work for them. Secondly, it can increase an organisation’s potency in the labour market by 50 per cent, enabling it to extend its reach to passive talent more effectively.
While an organisation’s EVP naturally has a vital role to play in attracting talent; it also plays a crucial part in retaining valuable employees. In order to create an EVP meeting both these objectives, HR needs to understand how candidates’ priorities change when they become employees. A key example of this would be remuneration, which is a high priority for candidates but becomes less important once they make the transition to employee, when attributes such as work-life balance come into play.
So, why does an EVP designed to retain and engage employees impact on an organisaton’s ability to attract talent? This is because, according to our research the views of employees past and present are those most likely to be trusted by candidates, holding far more sway than the more formal organisational channels designed to reach the labour market, such as websites, career fairs and advertisements, which earn the trust of less than half of candidates.
Too often hiring managers and recruiters feel under pressure to over-promise to candidates in order to deliver on critical talent needs. This overlooks the need for the organisation to deliver on the EVP promise they have made to those they employ or risk creating increasingly disengaged and disappointed employees who will be far less inclined to speak positively about their experiences with the organisation.
The absence of these advocates among past and present employees could lead the best talent to the door of a rival organisation. This is just one reason why the EVP offered by an organisation to both internal and external talent plays a key role in the battle for talent.
Christoffer Ellehuus is managing director of Corporate Executive Board’s Corporate Leadership Council