How to Increase the Impact of Your Talent Initiatives with Organization Guidance System

By Dave Ulrich, Norm Smallwood, Alan Todd | November 3, 2020

Key Takeaways:

  • Talent discussions should start by identifying desired results that matter to business leaders. 
  • The Organization Guidance System informs decision makers about which talent initiatives drive key outcomes.
  • Combining the Organization Guidance system with talent discussion shifts talent initiatives from descriptive to prescriptive, delivering profound improvement.

We know it matters. Some go to war for it. Professional sports teams draft for it. Actors and musicians audition to show they have it. Others consider it the ultimate solution and try to manage it. Agents contract for it. Organizations build plans to leverage it. Some are innately endowed with it while others strive diligently to earn it. All try to grow it. Talent.

Talent (called workforce, individual competence, skills, expertise/know-how, synonym for employees, and so forth) has been the hallmark of HR for decades. A multitude of programs and initiatives and untold millions have been invested to attract, retain, and upgrade talent. Yet, how do business and HR leaders know which talent initiatives deliver results?

We have spent the last 18 months creating an Organization Guidance System (OGS) that informs the impact of four Organization Effectiveness pathways on five key results (see Figure 1);

Figure 1
HR Portfolio Grid of Key Results × Pathways to Organization Effectiveness
(5 results × 4 pathways = 20 cells)
  Key Stakeholder Results
1
Employee
2
Business Strategy
3
Customer
4
Investors / Financial
5
Social Citizenship
Pathways to Organization Effectiveness A
Talent
1 5 9 13 17
B
Leadership
2 6 10 14 18
C
Organization Capabilities
3 7 11 15 19
D
Human Resources Department
4 8 12 16 20

In this article, we report the findings from our Organization Guidance System pilot study about which talent initiatives drive key outcomes (cells 1,5,9,13).

Step 1: Identify and measure key outcomes

Prioritizing talent initiatives starts with identifying desired results. The columns in Figure 1 suggest five stakeholder results that a company may prioritize [1] employee (well-being, competence), [2] business strategy (differentiated position, ability to execute), [3] customer (net promoter score), [4] investor/financial (profitability), and [5] social citizenship (environmental, social). Instead of talking about an innovative talent initiative, HR professionals should start talent discussions by identifying desired results that matter to business leaders.

Interested in learning more about our Organization Strategy & Transformation practice?

Step 2: Distill and measure key talent initiatives.

There are innumerable initiatives that could be done to improve talent. In our talent research and work, we identify three major talent domains (competence, commitment, and contribution or experience). Within each of these three domains, we identify a number of talent initiatives. For example, in the book Talent Accelerator we identify 13 talent initiatives to increase competence; in our engagement research, we identify 7 practices that make up VOI2C2E (Vision, Opportunity, Incentives, Impact, Community, Communication, and Entrepreneurship); and in Why of Work we identify 7 practices to increase contribution or experience.

Based on this work, we identify 18 talent initiatives we can assess. From our pilot study, we determined that these 18 talent initiatives could be distilled into 9 initiatives that an organization could invest in (see Figure 2). We created a 36-item index (4 items for each of the nine initiatives) to determine the extent to which each of the nine talent initiatives exist in an organization.

Figure 2
Nine Primary Talent Initiatives
Talent Initiatives Assessment (To what extent do…)
1. Acquiring Talent We bring the right people into our organization
2. Managing Employee Performance We facilitate employee improvement through standards, evaluations, and rewards
3. Developing Employees We find ways to help employees become better
4. Managing Employee Careers and Promotions We manage careers and succession opportunities
5. Communicating With Employees We share information with employees, so they know what is expected
6. Retaining the Best Employees We have the ability to keep our top performers
7. Managing Departing Employees We remove employees appropriately
8. Tracking Employee Engagement We have good ways to track employee emotional response to work
9. Creating a Positive Employee Experience We ensure employees have a positive personal experience at work

Step 3: Report status of talent challenges

We collected data on how well an organization performs on these nine talent initiatives (see Figure 3). This figure reports the overall mean (column A), variance (column B), and reliability (column C) of the measures of these nine initiatives.

This figure indicates which of the 9 initiatives are better done (positive employee experience (#9) and communication (#5)) and which score lower (retaining employees (#6). The results also confirm that these are valid measures of the nine dimensions.

Most talent research ends by showing global averages and comparing them to the scores in column A.

Figure 3
Talent Initiatives: Basic Statistics
Talent Initiatives
(Sample of 119 people in 45 companies)
A
How well we do it?
(1–5) Mean
B
Variance
Standard Deviation
C
Reliability Alpha
1. Acquiring Talent 3.33 0.49 0.87
2. Managing Employee Performance 3.41 0.54 0.77
3. Developing Employees 3.32 0.72 0.81
4. Managing Employee Careers and Promotions 3.14 0.66 0.84
5. Communicating With Employees 3.50 0.68 0.82
6. Retaining the Best Employees 2.86 0.64 0.59
7. Managing Departing Employees 3.33 0.62 0.61
8. Tracking Employee Engagement 3.34 0.69 0.80
9. Creating a Positive Employee Experience 3.51 0.63 0.79

Step 4: Report guidance on talent practices

To move from these talent descriptions (Figure 3) to prescriptions, we offer guidance in Figure 4. This figure shows the relative impact of each of the 9 initiatives (rows) on four outcomes we measured in the pilot (columns B, C, D, and E). We used proprietary analytics (variance decomposition) to understand how different talent initiatives will deliver different results (note: in the pilot, we focused on 4 results; we now have added a fifth, social citizenship).

Figure 4
Talent Initiatives: Basic Statistics
Talent Pathway A
Global
(1–5) Mean
What guidance can we offer?
(relative impact on… divide 100 points)
B
Employee
C
Strategy / Business
D
Customer
E
Financial
1. Acquiring Talent 3.33        
2. Managing Employee Performance 3.41        
3. Developing Employees 3.32        
4. Managing Employee Careers and Promotions 3.14        
5. Communicating With Employees 3.50        
6. Retaining the Best Employees 2.86        
7. Managing Departing Employees 3.33        
8. Tracking Employee Engagement 3.34        
9. Creating a Positive Employee Experience 3.51        
Model R2   19.8 24 15.7 10.7

The findings in Figure 4 dramatically shift the discussion of talent from what is done to what should be done. Some findings include:

  1. In general, the talent activities with the most overall impact on results are acquiring the right people and tracking their employee engagement. The overall least impact is removing people.
  2. Employee results increase the most through tracking employee sentiment and managing performance.
  3. Business strategy results are most accomplished through acquiring the right people and tracking their engagement.
  4. Customer results are most impacted by tracking employee engagement, communicating with employees, retaining the best employees, and acquiring the right employees.
  5. Financial results are most impacted by developing employees, acquiring employees, and managing careers and succession.

Implications

The implications of implementing the Organization Guidance System into talent discussions are profound. Depending on the results an organization seeks, business and HR leaders can utilize the information from the Organization Guidance System to provide data on where to focus talent initiatives.

Read the Organization Guidance System pilot results of the three other pathways: Leadership, Organization Capabilities and Human Resource Department.

Learn more about the Organization Guidance System and contact us to get started.

Dave has published over 30 books on leadership, organization, and human resources. These ideas have shaped these how people and organizations value to customers, investors, and communities. He has consulted and done research with over half of the Fortune 200 and worked in over 80 countries.  He has received numerous public recognitions and lifetime awards for his work. 

About the author

Norm Smallwood is a partner and co-founder of The RBL Group. His research and consulting focuses on helping organizations increase business value by building organization, leadership, and people capabilities that measurably impact market value. He has written extensively about leadership and organization effectiveness in eight books and over a hundred articles. 

About the author
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