HR and Talent - zircon-mc.co.uk · Jennie Walton HR Director PRS for Music Jill Hatcher Deputy Head...

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HR and Talent in the 21st Century

Copyright © 2013 Zircon Management Consulting Limited. All rights reserved.

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How can the leaders of today meet tomorrow’s business needs?

November 2013

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ContributorsThank you to the 39 HR and Talent leaders who contributed to this research, and also to those who could not be named or mentioned in the research. You made this research possible.

Name Job Title Company

Amanda Dias European HR BP Iron Mountain

Amanda Pick Head of Talent VW Financial Services

Andrew Game Director of Talent and Development Fujitsu

Andy Hill Head of Resourcing Invensys

Anne Best HR Director Iron Mountain

Arabelle Towndrow Head of Talent Pearson

Camilla Aitchison SVP Human Resources Inchcape

Clare Phillips HR Director Global Payments

Craig Wymant Global Head of Human Resources – Trading Thomson Reuters

Diana Barrera Torre People Director Pearson International US

Elly Tomlins Head of HR Strategy and OD Thomson Reuters

Faye Shortland Head of Global Talent HSBC

Francesca Campalani Head of Strategy Design RBS

Gill Martin Head of Leadership Development and OD PRS for Music

Helen Smith Head of Leadership and Organisation Development Travis Perkins

Jacky Griffiths HR Director – UK and Ireland ERM

James Bennett VP Business Process Architecture and Change Colt Technology Services

James Hutton Head of Talent and Development News UK

Jennie Walton HR Director PRS for Music

Jill Hatcher Deputy Head HR Directive Talent Management MOD

Julian Atkins Head of HR Coventry Building Society

Laura Ovenden Talent Management Director Beazley Group

Lydia Swartz Senior HR Business Partner Greene King

Lynn McSeveney Director, Group Talent Barclays

Mandy Garner HR Business Partner HSBC

Martin Firstbrook HR Director M&G

Matt Nixon Head of Talent Barclays

Nicole Wade Group Leadership Development Anglo American

Paul Marsden Head of OD Change Pearson English

Pippa Edwards Head of Talent Global Financial Services

Ruth Bailey Head of HR Strategy MOD

Sarah Barrick HR Director American Express

Suzanne Lovell HR Director Heptares

Taryn Sessel Head of Talent Anglo American

Tessa Castles Talent Management Lead BP

Vicki Evans Head of Talent Travis Perkins

Yvonne Sonsino Head of Reward and Performance Global Financial Services

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Contents

LOOKING BACK 6

What External Challenges Impacted HR and Talent Leaders in 2013? 6

What were the top 5 External Challenges in 2013? 7

What other External Challenges Impacted HR and Talent in 2013? 12

What Internal Challenges Impacted HR and Talent Leaders in 2013? 13

What were the Critical Internal Challenges in 2013? 13

What other Internal Challenges Impacted HR and Talent in 2013? 20

TAKING STOCK 21

What are the Characteristics of Successful HR and Talent Leaders? 21

LOOKING FORWARD 23

What are the HR and Talent Priorities for 2014 to 2017? 23

The Top Three Priorities for 2013 to 2017 23

Ten Additional Priorities for 2013 to 2017 25

What do we need from our HR and Talent Leaders from 2014 to 2017? 25

What questions are the business asking when it comes to talent? 27

What Questions should they be asking? 29

The Gap between HR Leaders and Managers 30

CONCLUSION 32

About the Authors 34

References 35Appendix 1 – The HR and Talent Leadership Capabilties 36

TABLES AND FIGURES

Table 1: The Critical External Challenges Impacting HR and Talent 6

Table 2: The Remaining 10 External Challenges Impacting HR and Talent 12

Table 3: The Critical Internal Challenges Impacting HR and Talent 13

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Table 4: The Remaining 10 Internal, Micro Challenges Faced by HR and Talent 20

Table 5: HR Leaders Today 22

Figure 1. Comparing Current and Desired Leadership Characteristics 22

Table 6: The Focus for 2014 to 2017 23

Table 7: The Remaining 10 Areas of Focus for HR and Talent in 2013 to 2017 25

Table 8: HR Leaders Tomorrow 26

Table 9: The Questions Asked by Business Leaders 27

Table 10: The Questions Business Leaders Should Ask 29

Figure 2: The HR Business Partnering Model 30

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HR and Talent in the 21st CenturyHow can the leaders of today meet tomorrow’s business needs?

Zircon interviewed 39 HR and Talent leaders, from national and global organisations, in order to understand:

•Themacro(external)andmicro(internal)challengesimpactingtheHRandTalentagenda.

•HowHRandTalentarerespondingtothoseexternalandinternalchallenges,andtheirresultant

strategiesforsuccess.

•ThecapabilityofHRandTalentleaderstodelivertheirpeoplestrategiesinlightofthesechallenges.

WhatarethecharacteristicsofasuccessfulHRandTalentleader?

•ThefuturerequirementsofHRandTalentin2014to2017andthecapabilityofHRandTalentto

deliverthosefuturerequirements.

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Looking BackWhat External Challenges Impacted HR and Talent Leaders in 2013?

Operating as a successful HR or Talent leader has become increasingly difficult in the past few years with increasing organisational complexity, increased external competition, reduced budgets, reduced head count and tougher demands

from the business. However HR and Talent leaders continue to be passionate about delivering the strategic requirements of the business, despite the external challenges and forces impacting them. HR and Talent are impacted by up to 15

external macro forces, with the majority of the interviewees being impacted by five of the external forces. The five external challenges consistently impacting the success of HR and Talent are listed in order of dominance and impact.

Table1:TheCriticalExternalChallengesImpactingHRandTalent

1 The State of the Global Economy

2 Availability of Talent Globally

3 Increased Globalisation

4 Increased Legislation and Regulation

5 Pace of Technological Change and Digitalisation

TheprimaryexternalforcesimpactingHRandTalentarethestateoftheglobaleconomy,inparticular increased competition

and market saturation; increased legislation and regulation, in particular risk and compliance, technologicalchangeand

digitalisationandfinallyglobalisationandtheavailabilityoftalentglobally.

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The long-term impact of an unstable economy has been to “slash budgets”, constrain staffing levels, and move the budget away from talent, development and succession planning, in order to focus on HR reengineering and downsizing. For many, shifting their focus from business growth, innovation and development, to survival, sustainability and downsizing is a risk. Innovation, creativity and product development is being stifled and future leaders are not being sufficiently developed for the future challenges, thus impacting future sustainability.

HR and Talent leaders are therefore finding creative ways to address talent and people issues, despite reduced budgets.

“With budget cuts we need to

do and tackle things differently

and do more with less, we need

to progress the talent agenda

without being inhibited by the

economic issues. This may for

some organisations mean using

technology more effectively”

Taryn Sessel, Anglo American

The leaders from HR and Talent are viewing and using this challenge as an opportunity to be creative in the ways they deliver their projects. They are negotiating harder with suppliers, to work more efficiently with limited budgets, and are stream lining processes in order to ultimately do more with less. However, the risk is that in their desire to cut costs and find

efficient solutions, organisations may ‘shoe horn’ standardised HR and Talent services into the business to make them fit for the short-term, instead of identifying and investing in the optimum solution for the longer-term – thus taking a curative rather than preventative approach.

1.The State of the Global Economy“We need to progress the talent agenda and build flexibility and resilience into it…although there may be budget cuts, there is always a way to progress the talent agenda.” Taryn Sessel, Anglo American

The HR and Talent leaders consistently mentioned the unstable state of the Euro, the global recession, the shrinking economy, market saturation and increased competition as being the key macro challenges impacting HR and Talent. These resulted in reduced consumer spending and confidence and reduced financial security. The markets particularly impacted tended to be those experiencing political or environmental unrest, including Greece, Egypt, Portugal, Italy, Spain and Japan. The strongest and more stable markets that were mentioned included the USA, Singapore and China.

Looking BackWhat were the Top Five External Challenges in 2013?The top five most consistent challenges faced by the HR and Talent leaders in 2013 are examined in detail:

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“There is a dearth of skills and

talent globally, particularly in

Brazil, China and India, where

we need to do more to develop

the talent from within, rather

than buying it in”

Andrew Hill, Invensys

Barclays are doing this by creating a global standard for calibration, in order to create standardisation and enable globally mobility.

In the UK, the challenges appear to particularly be in the Isle of Man, the Channel Islands and the Midlands, where unemployment is low and competition for talent is high. On this basis, getting strong available candidates is a challenge. Similarly, Ruth Bailey from the MOD notes that, because organisations within the public sector are less able to compete on salaries, there is a need to find alternative ways to attract people from the private sectors.

Indeed, this challenge of finding the right talent was recognised in both the Payments Processing Market and in the very specialist biomedical research industry.

“There is a real war for talent

resulting in inflated salary levels

and increased competition”

Clare Phillips, Global Payments

“Industry candidates often

need to be sourced from San

Francisco and the West Coast of

the USA”

Suzanne Lovell, Heptares

Most leaders interviewed were confident about their ability to attract and recruit talent at the entry levels. For example, HSBC and The Coventry Building Society are confident about their approach to talent attraction and acquisition at entry and graduate level. Their award winning global graduate attraction and assessment process, continues to produce their largest number of employees, and has resulted in a strong succession pipeline of employees for the future. The real challenge for the acquisition of talent globally appears to be at the senior levels. The pressing concern raised by the HR and Talent leaders is the ability to attract, retain and develop strong, global leaders who are mobile and willing to work in the more challenging and political economies and environments:

“The challenge is that we need

a set of global leaders, to work

across boundaries, to lead the

business forward. Pearson needs

to attract, recruit and retain a

new breed of leaders” Paul Marsden, Pearson

The successful HR and Talent leaders recognise the need to invest in growing talent consistently, throughout their global organisation in order to create a succession pipeline of talent across the whole organisation. They are thinking creatively to find alternative ways to attract talent, particularly at senior levels and are working to increase mobility of talent into new markets. However, there is a risk that organisations may focus too heavily on developing talent from their core markets, to the exclusion of the local ones. Indeed, global organisations are being challenged to ensure there is a representation of global leaders at the senior leadership level.

“It is a challenge to ensure

that a global talent strategy

represents the whole

organisation and not just one

region”

Jacky Griffiths, ERM

2. Availability of Talent Globally “We need to grow quality talent from within and calibrate the quality of that talent with the rest of the world” Matt Nixon, Barclays

The second most significant external challenge for HR and Talent is the availability of talent globally.

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“It is no longer appropriate

to put US business leaders

in to run businesses in local

markets; we need to develop

talent from within. The growth

markets in Asia are creating

a new generation of talent;

with new requirements and

expectations… we need to

change to be successful in the

emerging markets”

Craig Wymant, Thomson Reuters

It is a challenge therefore to create a global talent strategy that considers the cultural and geographical differences when the regions own the talent and not the business. A truly global talent strategy is based on fairness, openness and an awareness of global differences:

“Going global, is really about

assessing people fairly across

the different cultures and

countries. Businesses then need

to be able to compare a job

across geographies”

Camilla Aitchison, Inchcape

Part of this is about explicitly recognising cultural differences when defining and managing talent globally, celebrating those differences and not over simplifying it. Businesses recognise the need for standardisation and consistency when it comes to identifying, developing and retaining talent. However, an HR leader within a global organisation recognises the need to question who actually owns the responsibility for talent; the group talent or the region. This issue is particularly prevalent when both group talent and the regional businesses want to own and drive the talent agenda.

Fujitsu strive to deal with this challenge by bringing people together to have rich conversations about talent, and to have shared learning of what we mean by talent, in order to create a common language and understanding. Indeed, Jennie Walton of PRS for Music recognises the need for HR and Talent leaders to encourage international businesses to collaborate in order to understand each other.

If they fail to do so, they are at risk of operating multiple talent strategies, without fully considering the impact of rolling these out in some of the growth markets.

Successful HR and Talent leaders therefore need to face the challenge of increased globalisation by creating a global talent strategy that can then be adapted to different cultures and local needs. They then need to continue managing the balance between having a global talent strategy to ensure fairness and consistency, and giving the local markets responsibility for talent so that they take ownership and drive the talent agenda locally.

3. Increased Globalisation“Businesses need to have a talent strategy that is global, rather than multinational” Andy Hill, Invensys

There are global complexities of working in multiple markets and the fact that organisations are moving towards a global model is a significant challenge for HR and Talent. Craig Wymant of Thomson Reuters notes that the geographic regions of business are changing. Businesses are operating in new markets and cultures and are no longer able to run the way they have always done. Indeed, Laura Ovenden of Beazley recognises that decisions need to be made about what is consistent globally and what is delivered regionally. Businesses need to be mindful of global cultures and differences:

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Indeed, the risk and compliance regulatory environments have particularly impacted HR within Thomson Reuters, which is impacting both on time and resources. Andrew Game at Fujitsu also recognised how the legislation around immigration makes it more difficult for talent globalisation, as the world is

more protective of its shores.Businesses are therefore required to increase resources and to pre-empt, understand and respond to the changing regulations and requirements in order to keep business running and minimise risk. This can however be a drain on critical business resources. Whilst it is

necessary for business safety and effectiveness, the impact of regulatory red tape is that it slows down business. However, Successful HR and Talent leaders actively work to manage these challenges because non-compliance to these requirements would have a significant negative impact for their organisations.

4. Increased Legislation and Regulation“Regulations impact what we do internationally with our talent... it affects people’s roles, learning, development and change management” Laura Ovenden, Beazley

Consistently, the leaders mentioned that increased regulation, legislation (in particular the Data Protection Act 1998 and the Bribery Act 2010) and tighter requirements are a challenge for HR and Talent. This increased regulation was predominantly mentioned in the safety, immigration, risk and compliance areas.Barclays and Coventry Building Society agree, and confirm that training employees to meet regulatory expectations and standards is critical, particularly in light of the Commission of Banking Standards guidelines published in June 2013.

5. Pace of Technological Change and Digitalisation“In order to be part of the digital future we need to adapt our learning, development and talent programmes to make our people digitally savvy” James Hutton, News UK

The pace of technology change and the move to digitalisation is a challenge we have been hearing from clients for the last few years, however it continues to be a challenge. This is a critical challenge for a number of the organisations interviewed, in particular News UK, Barclays, Iron Mountain, PRS for Music and Pearson, where

being leading edge technology innovators is critical to their success. Even leading edge technology organisations like Fujitsu find this a real challenge. They recognise that they need to attract innovative technologists who are willing to push the boundaries;

“We need to create the right

environment to encourage

innovation... to enable people

to make strong decisions...

and agree which technology to

back”

Andrew Game, Fujitsu

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The impact of organisations moving to cloud based storage and digitalising the way they interact with customers, means that customers can be more self-sufficient which impacts on the type of employees to be hired in the future. Therefore, for each of the aforementioned companies, attracting high quality digital capability and talent is critical to success. Organisations like Barclays and Pearson need to be clear about the technical capabilities required and agree on the benchmark they are comparing themselves against. Indeed, this was recognised by one of our banking leaders who questioned:

“Who do we benchmark

ourselves against to ensure

success... another Financial

Services Organisation or a

Technology Business?”

Global Talent Director, Financial Services

Organisation’

“We need to agree the

technology skill we require and

be confident about the areas

to pursue”Arabelle Towndrow, Pearson

However; identifying, attracting and acquiring digital talent is not that easy. James Hutton of News UK recognises the struggles associated with attracting digital talent. He states that in order to attract the high calibre digital candidates it is important to share the exciting work that they

are doing and the environment within which they work. Ensuring that the organisation is attractive to this new generation of digital talent is half the battle. Organisations are considering the way they communicate and interact with their employees, recognising that Generation Y/Millennial employees are a new breed, preferring to communicate using different technology mediums. However there can be a reluctance from businesses to change and adapt, preferring to keep people in the office. However, research has shown that Generation Y/Millennial employees prefer to have a flexible work and life style, in order to maintain their personal lives.

“Younger generations do not

adapt well to coming into the

office every day and we need

to change to attract the right

digital talent”

Gill Martin, PRS for Music

“We [Pearson] need to be brave

and agile in order to drive

digitalisation and digital content

at pace”

Paul Marsden, Pearson

Successful HR and Talent leaders subsequently appear to deal with this challenge by attracting and retaining individuals who are innovative and adept with technology and by offering flexible working solutions.

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A further 10 Macro challenges were also discussed by the HR and Talent leaders and although they were not mentioned as consistently, it is worth mentioning them. The 10 challenges were wide ranging, they focus on a broad collection of issues from political instability and unrest through to an increased reliance on social media. They include the following:

Looking Back:What other External Challenges impacted HR and Talent in 2013?

Table2:TheRemaining10ExternalMacroChallengesImpactingHRandTalent6 Political Instability and Unrest7 Acquisition and Increased Consolidation in the Market8 Consumer Preferences and Changing Demand9 Global Branding and Visibility10 Generational Differences and an Aging Work Force11 Focus on Cost & Profitability and Shareholder & Investor Return12 Environmental Changes and Natural Disasters13 Supplier and Provider Partnerships and Relationships14 Organisational Reputation and Risk15 Increased Reliance on Social Media

In summary, the HR and Talent leaders interviewed described how environmental changes or political instability and unrest make it difficult to trade and conduct business or to protect brand and reputation, particularly when unemployment and union strikes are high. They therefore recognised the need to anticipate these risks in advance and put strategies in place to mitigate them. This need to protect, improve and maintain brand and reputation was a common theme throughout many of the interviews, particularly with increased competition and the impact upon social media and customer feedback, which can quickly devastate a brand.

In addition to this, HR and Talent leaders referred to the challenge of providing a suitable working environment for each of the different generations in the workplace. They discussed the variation in what different generations are looking for and how new individuals coming into the organisation have differing expectations about how they want to work. Lastly, many HR Talent leaders discussed the challenge of how their organisations have become focused on minimising cost, maximising profit and short term shareholder return, rather than taking a longer term perspective to ensure income is

maintained over time. They are being impacted by the recession, where consumers want more for less and have higher expectations of their suppliers. HR and Talent are therefore finding ways to energise, motivate and engage employees to meet the rising consumer demands and challenges.

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Looking Back:What Internal Challenges Impacted HR and Talent Leaders in 2013?

The interviews not only demonstrated that HR and Talent leaders are dealing with large external pressures and challenges, but also identified 15 internal challenges consistently impacting on the success of HR and Talent. The five core internal challenges that were most consistently mentioned include creating a clear leadership pipeline and talent strategy, delivering organisational change for the future benefit of the organisation and its employees, and maintaining a diverse workforce whilst ensuring a healthy level of employee turnover. These are each discussed in detail as follows:

Table3:TheCriticalInternalChallengesImpactingHRandTalent1 Strengthening and Developing the Leadership Capability2 Successfully Delivering Organisational Change and Restructure Programmes3 Creating and Implementing a Clear Talent Strategy4 Ensuring Diversity at Work5 Achieving a Healthy Level of Employee Turnover

Looking Back: What were the Critical Internal Challenges in 2013The top five most consistent internal, micro challenges faced by the HR and Talent leaders are examined in detail:

1. Strengthening and Developing the Leadership Capability“We need to create the headroom and a clear line of sight for development and growth” Clare Phillips, Global Payments

The most commonly identified challenge faced by HR and Talent leaders was strengthening their leadership capability. As a result, creating a leadership development programme is the first priority for most of the organisations interviewed. In particular they each discussed the importance of identifying the future requirements of the leader and how they need to operate as they are progressing up the chain of command.

“In order to succeed leaders need to understand the whole business, not just the business they are

working in” Sarah Barrick, American Express

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Travis Perkins is investing in a group wide programme in order to create a strong pipeline of talent for the whole organisation, who can deliver the business strategy and be the “leaders of tomorrow”. Jill Hatcher from the MOD recognises the importance of leadership development. She states that leaders need to feel as if they are part of leadership and are able to change, rather than just waiting to be told to do something. Developing leaders and getting people to progress more quickly is a common challenge faced by many organisations who want to accelerate the leadership development and talent process, and enable people to add the most value to the organisation as quickly as possible.

Effective succession planning is also critical to business success and the HR and Talent leaders interviewed all recognised the importance of having a clear and transparent career pathway to motivate, retain and progress talented leaders. This is particularly challenging for organisations that have both technical specialists and generic leadership roles. There is a concern that technical experts may reach a barrier in their career if they are not willing to enter into a leadership position.

“In order to retain talent,

people need to see that there

is the opportunity to progress,

that they can develop and that

the business will give them the

support and direction needed

to push them outside of their

comfort zone”Clare Phillips, Global Payments

In order to achieve this, business leaders need to have real conversations about the business requirements, the critical roles and the risk areas in order to understand the balance of skills and capabilities needed across the business.

Colleagues from Anglo American recognise the importance of this for mobility. Nicole Wade and colleagues within Anglo American are striving to create a global talent strategy that has “global citizens” that can deliver projects in different parts of the world. Organisations are being more “picky” about who they want to give global experience

to and who they make mobile. There is not the appetite there used to be to move people all over the world, but rather to focus on making certain, critical people more mobile. However in some organisations there is a reticence for managers to let go of talent, or to encourage talent to move around the business. Mandy Garner of HSBC recognises the need to encourage the business units to work independently and share their talent.

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With the established markets getting more and more saturated, businesses are looking for new, emerging markets to move into. For example, Iron Mountain an information management services company, are actively pursuing Latin America, Australasia, Eastern Europe and Russia. Indeed, nearly half of the organisations interviewed are undertaking a change or restructure as a result of a merger or acquisition strategy, the acquisition of new senior leaders, a new business model or strategy, or the realignment of the business against external commercial requirements. Unsurprisingly, despite five years of downsizing since the Global financial crisis of 2007-08, a reasonable proportion of the change initiatives mentioned were about down-sizing, cost cutting and increasing efficiencies.

Key questions being consistently asked by the HR and Talent leaders include; ‘what is the organisational structure and is it fit for purpose for the future?’ and ‘how can we be more innovative in the way we deliver our services to our customers?’

In order to ensure a successful organisational change and restructure programme the HR and Talent leaders consistently mentioned the following 10 success criteria:

1. Having a clear vision of the future1 and aligning the business structure to the future goals and strategy

2. Making sure you have the right level of sponsorship and that they want it and will commit to it2 because it really makes a difference how the CEO approaches the change agenda

3. Having a powerful reason outlining the purpose and benefits of the change and restructure 2

4. Having an external focus, considering the business reason to change, the competitive, customer, economic and legislative landscape 3

5. Communicating the proposed change, structure, impact and benefits in easy to understand language 4

6. Showing an understanding that change is difficult but necessary for future success 5

7. Simplifying the complexity in the organisation, in order to create more clarity and consistency 1

8. Focusing on the core activity required to deliver the strategy, making sure that change happens, and ensuring that quality is achieved 2

9. Identifying the core capabilities required to deliver the future strategy2 and the gap in capabilities 1

10.Creating roles that are feasible in the new structure and do not overload managers 6

1Paul Marsden, Pearson2James Bennett, Colt3Laura Ovenden, Beazley4Helen Smith, Travis Perkins5Gill Martin, PRS for Music6Amanda Dias, Iron Mountain

2. Successfully Delivering Organisational Change and Restructure Programmes“Organisations need to take more of a long term view during times of change and continue to develop talent from within” Andrew Hill, Invensys

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James Bennett of Colt recognises that the critical success factors for implementing a change programme are having a clear goal, timeline, method, sponsorship and business case for change. However change management is often underestimated, less than 50% of the challenge is coming up with the solution, and over 50% is taking the solution and making it real, making sure it is owned, understood and continually improved. In order to make change sustainable, you need committed, talented people, however this research recognises that during times of change it is often the people who are forgotten.

“During times of change, the

focus on external business

factors takes precedent…

which means we have limited

time to develop and support

people. Whilst the talented few

survive, there is no clear path

for developing that talent”

Gill Martin, PRS for Music

“During change the focus to

move and recruit new talent

means that organisations often

fail to develop talent from

within during these times of

change and restructure”Andrew Hill, Invensys

“Organisations fail to

understand where the talent

is and understand where the

change makers are in the

organisation”

Jacky Griffiths, ERM

When implementing change, understanding the required cultural fit, technical capabilities and behaviour requirements of talented employees for future success is critical. However, that is not the end of the story. Once businesses have defined who will remain and who will be recruited into the new structure, it is important they develop the talent capability. Businesses now need to invest in those who remain in the organisation in order to ensure that they have the capability and fit with the future requirements of the organisation.

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There was recognition throughout the interviews of the importance of motivating, engaging and retaining talent. It is important that organisations are clear about what they mean by leadership and capabilities, and that they recognise the importance of adequately preparing and developing individuals to ‘step up’ by providing them with the opportunities that they desire sooner. However, there is also a consideration of how to assess talent fairly and objectively; organisations are still working to identify the optimum assessment process because it is critical to have the correct talent assessment process, without bias, that is credible and accurate, to ensure that the right individuals are being provided with the opportunities. For example, it was recognised that more attention

also needs to be focused on offering an alternative career path from leadership roles, into senior specialist roles, for talented individuals.

Whilst HR and Talent leaders recognised the importance of developing a clear talent management strategy, it was evident that there is a need to gain buy in for this. It is important to provide evidence to the business that there is a substantial need for a talent intervention and for introducing talent programmes within functions. For example, Clare Phillips (Global Payments) discussed how the management and development of talented individuals through one-to-one coaching interventions should be seen as something that the business requires.

In order to overcome this challenge, HR and Talent leaders need to consider how to then communicate the talent strategy. Jill Hatcher (MOD) recognises the importance of publishing short, succinct documents and considering the timing of release to ensure a high level of receptivity. It is therefore not just about developing the right talent intervention for the organisation but then communicating this at the right time.

3. Creating and Implementing a Clear Talent Strategy“The biggest challenge is how organisations move away from what was training and development to strategy development and strategic talent” Craig Wymant, Thomson Reuters

Another commonly identified internal challenge for the organisations interviewed was developing and implementing a clear talent strategy, in order to effectively recruit, assess, engage and grow talent. Craig Wymant, Global Head of HR for Thomson Reuters, expressed how there is currently an ‘old school’ training and development mindset to talent. He states that the biggest challenge is moving away from this to strategy development and strategic talent management. Consequently there is a need for organisations to move towards a more sophisticated way of identifying and managing talent, moving beyond a simple appraisal system to an integrated talent management system.

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One key area where there tended to be a lack of diversity was in senior leadership teams, where it was reported that either they were mostly male dominated or lacked geographic representation. For example, an HR leader within a global organisation explained how although the company is global, the senior leadership teams tend not to have diversity; there is no US representation at the Senior Leadership level. In many organisations now, there is a need for greater female presence within leadership roles. Mandy Garner explained, they are seeking to address this within HSBC by educating managers, promoting flexible working, writing blogs in order to understand and share alternative views, exploring reaction to female progression within the organisation and educating female talent on how and when to progress through the organisation.

Another example of where organisations can lack diversity is when they belong to traditionally very male dominated industries, for example the MOD. Ruth Bailey and Jill Hatcher both recognised the limitations within the MOD, identifying that the organisation often requires a very specific set of experiences that are relevant to the sector and so can limit the types of individuals who apply for the roles. However, they are looking to overcome this in other ways – for example seeking to develop people once they are in the organisation, as opposed to expecting them to have all the desired skills straight away. In addition to this, they are speaking to organisations with a similar background to defence which is traditionally a male environment and trying to identify what can be done better – ‘comparing apples with apples’ – then putting in place development and mentoring programmes to improve diversity.

Other organisations are also seeking to develop onboarding programmes for multi-cultural and multi-generational employees with the intention to integrate new cultures into the business and ensuring the right infrastructure.

It is therefore evident from the interviews conducted that there are multiple challenges to overcome in order to develop diverse and inclusive working environments, most of which take time to address, seeking to influence ingrained attitudes or update traditional and out of date infrastructures. HR and Talent leaders who are successful in overcoming these obstacles, challenge traditional ways of thinking, promote inclusive working practices and seek to make real and visible changes to the organisation around them.

4. Ensuring Diversity at Work “We need to build a stronger pipeline and see more females moving into senior leadership roles” Craig Wymant, Thomson Reuters

Diversity in the workplace, or lack thereof, was another key internal challenge for many of the HR and Talent leaders. The need to encourage and further promote diversity was mentioned by a number of different leaders, with each of them recognising the importance of a diverse and inclusive working environment. However, the challenges HR and Talent leaders face when it comes to developing diversity often do not have ‘quick fix’ solutions; for example, ingrained attitudes and tradition, underdeveloped assessment processes, and a lack of infrastructure to support employee differences.

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Many of the organisations interviewed are recognising that since the economic downturn there has been an unhealthy, low level of turnover, with levels ranging from 2% to 5%.

“In some areas, we have

a lot of turnover which is

difficult to manage, but in

other areas, there is very little

movement, which depending

on circumstances, can be just as

difficult to manage from a talent

perspective”

Taryn Sessel, Anglo American

While average turnover rates vary according to discipline/profession, industry, region and country, and are impacted by factors such as economic conditions, geography and politics, the healthy level of turnover according to Gallup is 10% which is therefore between two and five times higher than current rates.

Our research identified that when an organisation has a

low voluntary turnover rate, the workforce can become static and unmoving, preferring to deliver current requirements and work within safe and predictable boundaries.

The impact of this, as three HR and Talent leaders mentioned, is a potential reduction of proactivity, creativity and entrepreneurialism. It may also negatively impact change and future growth within the business which can reduce performance culture. This can be a problem where there is a low voluntary turnover rate within leadership teams where some individuals have been in the role for 25 years. It can be demotivating and frustrating for the high potential talent, who should succeed into these roles.

Some of the organisations interviewed are managing this low turnover in the short term by not extending fixed term contracts and by creating attractive redundancy packages. It was agreed by many of the

businesses interviewed that it is necessary to set some clear expectations and make some tough decisions about what they need from these people. They also consistently agreed that they need to be stronger and deal with this head on.

The successful HR and Talent leaders are facing the challenge of a static workforce, not by asking the question “How many are leaving?” but rather asking, “Who is leaving and who is staying and why?” and “What is the impact of this on our business?” The successful HR and Talent leaders interviewed from PRS for Music, Pearson, Greene King, Anglo American and others are all looking at positive ways to create a healthy, flexible workforce that reflects the strategic requirements and needs of the future business, and by challenging those who are “static” to check their fit with their future business needs and requirements.

5. Achieving a Healthy Level of Employee Turnover“The long serving leadership team creates tremendous headroom pressures”

HR Director, Global Business

One of the challenges recognised by HR and Talent leaders was establishing targets and taking steps to manage employee turnover. When turnover is healthy, it works to remove low performers (i.e. problem staff and/or those not willing to improve) and nurture an engaged, high-performing, world-class workforce. However, a number of the organisations involved in this research are grappling with low turnover and a static workforce which is impacting on their talent capability and growth.

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Looking Back:

What other Internal Challenges Impacted HR and Talent in 2013?

In summary, the HR and Talent leaders interviewed described how maintaining an effective and efficient work environment by managing costs, budget and location was one of the key internal challenges faced by HR and Talent leaders. Furthermore there is a need to ensure effective talent acquisition by providing clear guidelines on leadership and capabilities. In addition to this, the change of leadership at the CEO and Board Level has meant that leaders are not clear about the future. They discussed the need to identify the requirements of leaders and future leaders.

Expansion of the business was another challenge identified. It is important to recruit for the future, whilst managing organic growth within the organisation by thinking longer term. The HR and Talent leaders interviewed also recognised the importance of an engaged workforce being fundamental to retaining the right people and creating a good working environment. Equally, importance was placed on enabling an innovative and entrepreneurial culture. These results highlight the importance of maintaining a high level of capability within HR in order to ensure that HR

and Talent colleagues have the ability to handle the multitude of macro and micro challenges, communicate these strategies to deal with these challenges clearly to the business, share their knowledge and learning openly with others and create a motivating and engaging environment for others to buy into.

The interviews identified a further 10 internal forces and challenges impacting HR and Talent.

Table4:TheRemaining10Internal,MicroChallengesFacedbyHRandTalent

6 Maintaining an Effective and Efficient Work Environment (Includes: Managing Costs, Budget and Location)

7 Ensuring Effective Talent Acquisition (Despite the Skills Shortage)

8 Change of Leadership at CEO or Board Level

9 Business Expansion via Acquisition and Organic Growth (Acquiring and Integrating New Businesses versus Organic Growth)

10 Creating an Engaged Workforce

11 Managing Outsourced Contracts and Supplier Partnerships

12 Ensuring High Levels of Capability within HR

13 Creating an Innovative and Entrepreneurial Culture

14 Managing Knowledge to Ensure a Competitive Advantage

15 Creating a Motivating Reward and Benefits Strategy

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Taking Stock: What are the Characteristics of Successful HR and Talent Leaders?

For many years, HR departments have been challenged for being “too touchy feely”, “operational” and “compliance focused” (Kreissl, 2011). Despite the plethora of external and internal challenges being handled by HR and Talent leaders, many organisations still see HR as an “overhead” rather than a “strategic partner”. This stereotype still exists today because over 50% of HR leaders and professionals are

very effective executors of projects and requirements.

“HR can be great at delivering

business requirements however

they do not always challenge

the business sufficiently or think

commercially”

Sarah Barrick, American Express

“The problem is that many

HR professionals are order

takers, they service today’s

business needs, rather than

serving the business for longer

term sustainability and future

growth”


Andrew Hill (Invensys) reports that the lack of challenge from HR means that they are often process driven, and, while they are clear on accountability, they are not flexible. As a result HR are often regarded as ‘purist and theoretical’ and as a result they are not always pragmatic. They can be seen to have an “old school” mentality, and to see each business unit as a separate business, meaning they work more in isolation than collaboratively.

The research suggests that successful HR and Talent leaders are strategic, broad business thinkers and they are thought leaders and forward thinkers.

“Strategic HR and Talent leaders

are driven by change, they

are commercial and focused

on what the business needs in

order to be successful. Their

commerciality drives the HR

agenda”

Amanda Dias, Iron Mountain

“Strategic HR leaders are more

direct, pushy and business

focused, they are also less

democratic and inward looking”


All of these characteristics rarely exist in one person so businesses need a blend or mix of HR professionals in order to meet each of the demands of the organisation. This research suggests that there is indeed a mix of HR and Talent types and characteristics in global organisations. This research found that 22% of HR and Talent

leaders are strategic and future focused, a small proportion of HR leaders are Commercial (6%), Change Agents (4%), Collegiate (6%) and Technical (5%). The remaining 57% of HR and Talent leaders are therefore described to be less strategic, commercial and change focused, and are therefore functioning in a more operational way. They are described as “order takers” and while they are highly responsive to business requirements, they are not challenging the business, driving change, or taking a broad business perspective to a problem.

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Type of Core Range of Average HRLeader Strength Percentages Percentage

Operational Execute Projects 20 – 90 57%

Strategic Broad Business Thinkers 0 – 50 22%

Commercial Numerate and Financially Focused 0 – 60 6%

ChangeAgents Innovative & Challenging 0 – 33 4%

Collegiate Cohesive & Democratic 0 – 30 6%

Technical Specialist, Deep Business Thinking 0 – 25 5%

Andrew Hill (Invensys) agreed that commercial HR leaders are less common, yet such leaders are often considered critical for business effectiveness because they are numerate, financial and data driven. However, this may be because the HR role is traditionally less focused in this area. Another less common type of HR leader are those who act as Change Agents, and these individuals are responsible for innovative thinking and challenging the business.

“The HR leaders who are

Change Agents are more

challenging and direct and

want to drive change”

Nicole Wade, Anglo American

The HR leaders regarded as Collegiate are cohesive and democratic. Andrew Hill (Invensys) states that the collegiate HR leaders want to get on well with each other, are people focused and want to work in harmony. They are consensus driven, protective and want to

do things well. According to the interviewees, they bring the organisation together to achieve objectives, creating collaboration and cooperation. They are seen as critical to ensure harmony and good will in an organisation and to treat each other with respect. Finally, the Technical Specialist leaders are experts in their area and have deep business knowledge and expertise. They are required in order to give balance to the more generalist HR Directors and to share their deeper technical knowledge.

The HR and Talent interviews therefore identified that the successful HR and Talent leaders are change agents and strategic partners of the business.

They are dynamic, visionary, commercial, broad focused, and look both externally and internally when planning and benchmarking. However the reality is that over 50% of HR and Talent leaders are operational and rule following, therefore they are strong at executing and delivering projects. They do not challenge, drive change or push the business sufficiently to drive commercial success. Having over 50% of the HR population solely responding and reacting to business requirements is a potential risk for organisations given the plethora of external and internal challenges impacting the future success of the HR and Talent projects.

*HR and Talent leaders are defined as those who are budget holders

Table 5: HR Leaders Today*

Figure1.ComparingCurrentandDesiredLeadershipCharacteristics

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Looking Forward: What are the HR and Talent Priorities for 2014 to 2017?

Now that we have established the Macro and Micro challenges facing HR and Talent leaders, it is interesting to understand the challenges that are on the horizon for 2014. The main priorities highlighted by the research are to create a clear and sustainable talent development strategy, improving the capability of their managers and leaders, and to ensure that the business is sufficiently agile and innovative in order to fully respond to change and growth requirements. Each of these areas are discussed in further detail below.

Table6:TheFocusfor2014to2017

1 Defining a Clear and Sustainable Talent Development Strategy

2 Improving Management and Leadership Capability

3 Creating an Agile and Innovative Organisation to Support Business Growth and Changing Business Needs

Looking Forward: The Top 3 Priorities for 2013 to 2017Thethreemostconsistentareasoffuturefocus,identifiedbytheHRandTalentleaders,areexamined in detail:

1. Defining a Clear and Sustainable Talent Development Strategy “We need to be clearer on how we enable the talent to develop in the organisation”


One of the main areas of future focus, across many organisations, was the need to define and implement a clear and sustainable talent development plan, in order to bring talented people together successfully. A number of leaders discussed this as an important milestone for them and their organisation, in order to promote successful

business growth. A clear talent plan can form the backbone of an organisation, being a catalyst for driving successful performance across multiple business areas. The development and success of this area within an organisation should influence and assist the development of other focal areas, creating a lasting domino effect, and should therefore

be a prime contributor within any organisations future. The benefits of a robust recruitment and selection process is widely recognised by the HR and Talent leaders, forming a key aspect of an overarching talent strategy which should resonate throughout an organisation to ensure best practice.

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“We need a leadership

development process, to

understand strengths, gaps, EQ,

fit, future and to ensure that we

have the right population”

Paul Marsden, Pearson

The benefits of concrete leadership and management are clearly understood by the HR and Talent leaders who voice a keen interest in developing these within their organisations. It is important for organisations

to look to raise the standard of their managers and focus on enhancing their capabilities within their role. Leaders need to take charge and operate as leaders, not managers. It is important for them to understand this difference and use their competencies to bridge the gap between the two.

By improving this area of the workforce, leaders and managers can create bespoke development and learning activities that map

to the necessary capabilities and then ensure these are embedded and practiced throughout the whole organisation. Additionally, leaders and managers should not just focus on the behaviour of their team, but should instead think about each individual as a ‘whole person’, in terms of their values, capabilities, strengths, aspirations, motivations, intelligence and fit to the organisation.

2. Improving Management and Leadership Capability“We need to develop our leadership capability across the organisation and not just focus on the partners” Jacky Griffiths, ERM

The second area identified as an important focus for 2014 involves embedding leadership competencies within the organisation and promoting management development.

3. Creating an Agile and Innovative Organisation “We need to know if we are efficient, effective and agile enough to meet the needs of the business, and then continue to review the business model and how it operates” Mandy Garner, HSBC

Creating an agile and innovative organisation to support business growth and changing business needs also appears to be on the future agenda of many HR and Talent leaders. Many recognise that the change agenda must align with the future strategy, goals, culture and vision of the organisation, and should proactively consider what the organisation needs in order to move forward, rather than taking a reactive approach.

Within News UK, “agility, ambiguity and resilience” are three key words associated with their success. Being an agile organisation means that News UK are able to move quickly, handle complex and ambiguous data, and demonstrate resilience in

the face of change and uncertainty. James Bennett (Colt) recognises that effective agility means that the outcome is ‘fit for purpose’, to support successful business growth, and promote innovation and change in the desired direction.

Being better connected and having open lines of communication within the organisation was also identified as being critical to support business growth and changing business needs.

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There were a number of other areas of future focus mentioned by the HR and Talent leaders, as displayed in the table below. The need for career and workforce planning and flexibility was mentioned by a number of leaders. The benefits of this would be to stabilise the workforce and provide more confidence within the roles of the organisation. Furthermore, balancing HR support and activity with the business requirements is also a key focal point for 2014, in addition to building the confidence and engagement of the workforce, and enhancing performance management processes.

Table7:TheRemaining10AreasofFocusforHRandTalentin2013to2017

1 Career and Workforce Planning and Flexibility

2 Culture and Climate Change

3 Embedding an Internal Resourcing Strategy

4 Balance HR Support and HR Projects with Business Requirements

5 Creating a Coaching and Learning Environment

6 Defining the Desired and Actual Organisational Culture and Values

7 Agreeing What the Future Will Look Like

8 Building the Confidence and Engagement of the Workforce

9 Delivering the New CEO Agenda

10 Enhancing the Performance Management Process

Looking Forward: Ten Additional Priorities for 2014 to 2017

Looking Forward: What do we need from our HR and Talent Leaders from 2014 to 2017?

“They need to be integrated in the business, commercial and externally focussed”


The role of an HR and Talent leader in the 21st Century is increasingly stretching and challenging. Not only do they need to effectively manage and handle the aforementioned macro and micro challenges and have a number of stretching targets for 2014, they are also required to be visionary, strategic, articulate, commercial and pragmatic. All of this means that it is very ‘tough at the top’ and it is rare that an HR or Talent Director is likely to possess all of these qualities. Businesses therefore need a mixture of HR professionals in order meet these requirements and be successful.

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The demanding macro and micro challenges mean that it is no longer sufficient for HR to merely be responsive to business requirements. Jennie Walton (PRS for Music) states there is a need to be more assertive, proactive and participative outside of HR, in order to guide, direct, lead, challenge and encourage business leaders. HR are subject matter experts in their field, however they lack external focus, breadth and commerciality.

“HR are too siloed and too

internally focused, they need

to be integrated into the

business, and commercially

and externally focussed.

We need to empower HR

managers and leaders to

be more change and future

focused. We need to give them

ownership and empowerment

to make decisions. They need

budget responsibility, they

need to be held to account

for the financials, they need to

be commercial and business

minded”Craig Wymant, Thomson Reuters

Sarah Barrick (American Express) notes that whilst it is important

for organisations to have a blend of HR leaders, the emphasis is overly focused on ‘order and note takers’ and there is not enough focus on identifying strategic thought leaders and forward thinkers. HR needs to move away from being transactional and towards understanding the business landscape, finding the best solutions and creating the future.

“You need to be strategic to

survive as a modern HR leader.

You cannot purely focus on

operational delivery”Ruth Bailey, MOD

Table 8: HR Leaders Tomorrow TypeofHRLeader CoreStrengths AveragePercentage

Operational Execute Projects 30%

Strategic Broad Business Thinkers 30%

Commercial Numerate and Financially Focused 10%

ChangeAgents Innovative & Challenging 10%

Collegiate Cohesive & Democratic 10%

Technical Specialist, Deep Business Thinking 10%

When we examined this further, we found that the HR leaders consistently agreed that the ultimate collection of leaders would be an even mix of operational implementers and strategic change agents as shown in Table 8. Specifically, businesses are looking for HR leaders who are:

• Pragmatic and decisive

• Commercial, numerate and business focused

• Holistic, entrepreneurial and externally focused

• Credible, consultative and professional

• Open minded, innovative and visionary

• Challenging and dynamic

• Positive and courageous

• Strong communicators and agile thinkers

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HOW CAN WE ATTRACT AND RECRuITTALEnTEDPEoPLE?

How do we set the bar at the right level?

How can we recruit the right talent into the organisation?

What do we need to pay in order to get the right person?

Where do we get the people from?

Are we in the right location to attract talent?

HOW CAN WE CREATE TALEnTMobILITy?

How can we move talent around the global offices?

How can we solve the mobility issue?

HoWDoISPoTHIgHPoTEnTIALS?

How do we know if my high performers have got potential?

Who is our talent?

How do we identify my high potentials?

How do we identify who is talent?

What are the key requirements for success for our people?

Who has future potential?

Where is there data to prove what talent looks like?

What does good look like?

How do we identify talent further down the organisation?

WHATDEvELoPMEnTPRogRAMMESAREAvAILAbLE?

Can we have a talent programme?

What opportunities are there to develop our talent?

How can we embrace talent and develop it, without a formal “development or talent management programme”?

What is the organisation doing regarding talent?

What do we do with our talent and how do we develop them?

What development can we give this person?

How can we give our people broader experience at no extra cost?

What are you doing to develop the technical skills of our high potentials? (not just leadership skills)

How can we encourage our specialists to stay and remain engaged?

What is our structured framework for developing talent?

As we grow as a business, how do we grow our talent at the right time and in the right areas?

Looking Forward:What questions are the business asking when it comes to talent?The 39 interviews were analysed in order to understand the types of questions the HR and Talent leaders were being challenged with by their internal stakeholders and customers; only 10% of the HR and Talent leaders were not able to list any talent questions raised by the business leaders. The 10% stated that their business is currently not asking any questions about how they could better recruit, develop, manage and retain their talent; “they are not asking much about talent, particularly with the change agenda, managing talent is not a priority”. Despite this, for 90% of the organisations interviewed, talent is a priority and as a result the HR and Talent leaders interviewed were easily able to list the types of questions posed to them by the business leaders.

The questions asked by the businesses are clustered into 8 main categories in Table 9 below. These show that the business leaders are inquisitive and want more information about the talent programmes and opportunities available to their people.

Table9:TheQuestionsAskedbybusinessLeaders

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HOW DO WE RETAIN THE MoSTTALEnTEDPEoPLE?

How do we retain key talent when there are no future roles for them to progress into?

How do we develop and keep them?

What are we doing to retain the talented people? What opportunities are we offering them?

How do we know that we have enough people with the right skills and knowledge?

WHATISouRAPPRoACHToSuCCESSIonPLAnnIng?

What is the talent pipeline?

How do we progress people within the business?

How do we know if the talent is ready to progress to the next stage?

What is my career path? What is available to me?

What do we need to do in order to be successful?

How do we give them the next role or opportunity?

How do we know whether we have enough people who want to progress their career with us?

HoWDoWEMoTIvATETALEnTEDPEoPLE?

How sustainable is it to ask our managers to keep delivering more, with less?

How can we rally and motivate the troops to go over and above, with less?

How can we motivate people after the talent programme has been completed, particularly when promotion opportunities are limited? What’s next?

How can we motivate talented people when there are pay freezes and all of the messages are negative?

How do we motivate them? How do we keep them challenged?

HoWCAnWEuPSkILLTHEMAnAgERSoFTALEnT?

How can we manage talent better?

How can we successfully manage an under performer?

How can we equip managers to have those difficult conversations?

How can we equip our managers to have courageous conversations with their people?

How can we equip our managers to have good career discussions?

What are we doing to develop the coaching skills of our line managers?

These results confirm the 2012 Zircon Talent Research that business leaders want more information about how they can successfully attract, retain, develop and motivate their talented people. They want to know what is available to them, and how HR and Talent can support them in the management of talent.

Business leaders therefore need to achieve an open flow of communication with their HR and Talent colleagues about what is on offer to them, what they need to do, and how HR and Talent can help them to develop their high potential employees. The business leaders are asking for more detail, depth and understanding about what programmes, initiatives and support is on offer to them and their team in order to successfully manage and retain their talented people.

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WHATCAnIDo?

What can I do to help the talent progress and develop?

How can I increase my effectiveness as a leader?

What should I be doing to drive this for myself?

What can I do to support you?

What can I do about this?

How can I engage and influence my senior stakeholders more successfully?

How can I engage my talented people?

WHATbEnCHMARkIng DoWEDo?

How do we benchmark the capability externally with our competition?

What are our competitors doing?

What are our competitors doing that differentiates them?

What is best practice in the talent arena?

WHAT IS THE RETURN ON InvESTMEnT?

Who is paying for this?

What is the financial implication of this intervention?

What is the cost benefit analysis of what we are doing?

What is the return on investment?

How can we get a ROI on this investment in talent development?

How do you know this works and adds value?

How efficient is this process?

Are we investing in the right things? What is the proof?

HOW SUSTAINABLE IS THIS APPRoACHFoRTHEFuTuRE?

What is the strategic driver for talent?

What is the talent strategy?

What do we need in 5 years and beyond?

What do we need to do in the future?

How does the team need to be structured in the future to be successful?

What else should we working on?

What are we not doing? Why?

How sustainable are these solutions for the future?

Are these long term solutions?

What are we doing at the lower levels of the organisation?

WHAT ARE WE DOING AT THE LOWER LEvEL OF THE oRgAnISATIon?

How can we spot high potentials earlier in their careers?

What does talent look like at the lower levels?

What does high potential look like at entry level?

What Questions should they be asking?The research found that different types of question are not being asked by the business leaders. The HR and Talent leaders interviewed, expressed that the following questions shown in Table 10 below, are not being asked, but should be asked given the current challenges in their organisations.

Table10:TheQuestionsbusinessLeadersShouldAsk

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The business leaders’ questions focus mainly on understanding the programmes and support available to them in order to attract, recruit, develop, motivate and retain their talented people. The questions they are not asking tend to be more strategic, future focused, externally focused, long term and financially driven. Consistently the HR and Talent leaders impression of the business leaders is that they do not explore what they can do

as business leaders to drive the talent agenda, and rather focus upon what can HR and Talent do for them.

These results show a different mindset between HR and Talent and the Business. The 2012 Zircon Future of Talent Management research identified that business leaders want more information, depth and complexity in order to deliver talent strategies more effectively.

However the 2013 research suggest that this information is more about what HR and Talent can do for them than what they can do for themselves. The impact of this is that business leaders remain distant from, and do not fully own, the implementation of the talent strategy. It is therefore seen as a service rather than something that they are part of, and do not necessarily see themselves as being critical to its success.

Looking Forward: The Gap between HR Leaders and Managers

Nearly all of the organisations interviewed in this study follow the Ulrich (1997) Business Partner model. Their aim being, to deliver strategic change through strong partnerships with their internal customers. Ulrich (1997) defined four roles within the HR Business Partner Model, namely Strategic Partner, Change Agent, Administrative Expert,

and Employee Champion, and furthermore argues that you need a blend of each to make the organisation successful. The Strategic Partner aligns the HR functions with the global business in order to map the people strategy to the business strategy. The Change Agent drives the change agenda and creates the capacity for the change to

be delivered. The Administrative Expert is expected to ensure the delivery of the highest possible quality services at the lowest costs to the organisation, and the Employee Champion is the HR professional who takes the utmost care of the employees’ needs and issues and looks after them during the change process.

PROCESS

PEOPLE

STRATEGICFOCUS

Strategicpartner

Administrativeexpert

Employeechampion

Changeagent

OPERATIONALFOCUS

Figure2:TheHRbusinessPartneringModel

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Our research suggests that while most senior HR leaders are commercial, change agents and strategic partners (equivalent to the 32% of the HR and Talent population), the more junior HR business partners and managers, are predominantly functioning as administrative experts, technical experts and employee champions (68%). While these roles complement each other, there appears to be growing gap between the capabilities of the HR leaders and their reports.

HR leaders are required to drive business success and be strategic drivers of change in order to be effective. On the other hand the HR business partners and managers are required to champion the employees by being supportive, collaborative, rule followers, and administrative experts. The main and most pronounced difference is that HR leaders are strategic, and balance having both an internal and external focus, whereas HR partners are operational and are primarily inwardly focused. The impact of this is significant on succession planning and talent management within HR, with organisations finding it increasingly difficult to identify future HR talent from within, as the gap is too big to bridge.

This is because many organisations have promoted by default, without having a clear articulation of what HR needs to achieve at the more

senior levels. At times they have failed to recognise that there are significantly different requirements for HR professionals as they progress further up the organisation. Consequently, there is often a real gap between the desired and actual leadership capability of HR and that of their successors.

Beazley started to address this gap in 2011; “we realised we were order takers and prided ourselves on service and delivery, however we recognised that this wouldn’t help drive the future of the business. As a result we are now more challenging of the business, we focus on pushing the boundaries, and we work with them in order to evolve and grow the organisation. As a result we are trusted advisors, and are more progressive” (Laura Ovenden, Beazley)

Ulrich (2008) himself recognises the failure in the model is that those in an HR business partner role have interests and abilities that “may make them focus on administrative detail rather than embrace the larger and more complicated perspective of the business as a whole”. Our research has found that many of the more junior HR colleagues may want to operate as partners to the business, but they do not know how to proceed. Our research therefore concurs with Ulrich’s finding that some “20% of HR professionals will probably never be able to fully adapt

into the HR business partnering role”, and more worrying is that more than 50% of HR colleagues are working in an operational, administrative, rule following manner, that has no relation to the strategic, dynamic, challenging and commercial role of the HR director. The research also identified that this gap is getting larger.

Our research suggests that the majority of HR professionals are not able to adapt to a full business partnering role because of the time required to cover all the four aforementioned aspects of HR partnering, the capability to be both operational and strategic, the fit with their personal strengths, and their personal values and beliefs about their role as an HR colleague. These results suggest that those people who progress to HR director positions have a very different belief and value system to those who are successful HR colleagues and partners. The director aims predominantly to ensure organisational success, and the colleague works for the employees.

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HR and Talent in the 21st Century Conclusion - How can the leaders of today meet tomorrow’s business needs?

Zircon interviewed 39 HR and Talent leaders, from national and global organisations, in order to understand HR and Talent in the 21st Century and in particular, the macro and micro challenges impacting them. We found that the role of an HR or Talent leader is demanding, and that the HR and Talent agenda is being challenged by a number of internal and external forces. The main external challenges were the global economy, the pace of technology and change, increased legislation, increased globalisation and as a result the availability of talent globally. The main internal challenges were delivering successful change programmes, creating a clear talent strategy, ensuring diversity at work, strengthening the leadership capability, and ensuring a healthy level of turnover.

As HR and Talent are central to all of these challenges and changes, the 39 interviewees were able to fully discuss the impact of the critical challenges on the long term success of their organisations. As a result of these challenges, leaders need to be even more externally and commercially focused in order to deliver the requirements of 2014 and beyond. To do this, they also need to fully engage the business and partner with them to co-deliver the talent agenda. HR and Talent need to convince the business to work together with them in order to make talent management both successful and sustainable, even though the business would often like HR to deliver the talent solutions for them rather than with them.

HR and Talent leaders can vary significantly in terms of their strengths. Talent leaders tended to be more focused on the impact of the macro and micro challenges, where as HR were more focused on the impact of efficiencies and effectiveness. However, both HR and Talent leaders need to be innovative, challenging, strategic, future focused, commercial, and pragmatic in order to be successful. The reality is that often only the most senior HR colleagues are operating as commercial, future focused, change leaders, with a large proportion of HR managers and partners operating as “order takers” and “service providers”. The gap between HR leaders and HR business partners is therefore growing, with HR leaders demonstrating evidence of being innovative, strategic, challenging, future focused, dynamic and resilient, and HR Business Partners tending to be operational, tactical, empathic and present focused. This marked difference in styles, strengths and approach between HR leaders and managers/business partners suggests that the succession of HR may be a significant challenge in the future.

Our research demonstrates that over the past few years organisations have responded to market forces and have rationalised, reviewed and streamlined operating models. HR and Talent leaders have been reactive to the needs of their organisation, aligning themselves to the strategic agenda and applying processes to deliver, often operating in a transactional style. However, organisations are preparing for a future state which includes growth, digitisation and commercial advantage which will require new ways of operating and a change in approach. In order to ensure success, leaders need to be more externally and commercially focused to deliver the requirements of 2014 and beyond. Organisations should review their mix of talent within HR teams to ensure there is balance of strategic, articulate, commercial and pragmatic approaches to be fully effective.

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They also will need to engage the business to be more strategic and future focused when it comes to talent, and to consider the ROI, ROE and the effectiveness of the methods used. Businesses however would like HR to deliver solutions to them, and to provide a service that they can pick up and use. HR, Talent and the business need to speak the same language and have the same understanding about the future talent requirements in order to be successful and sustainable. Executive leaders need to understand the talent agenda and its importance to the success of the organisations’ strategic plan. To maximise impact, they should become champions of the talent agenda, communicating a clear and consistent future vision which is fully aligned to that communicated by the HR and Talent Leaders.

The future success of HR and Talent therefore depends on investment in the development and succession planning of their internal resource. They should aim to develop a blend of HR and Talent professionals with a variety of capabilities and strengths in order to meet the multitude of complex micro and macro challenges.

In summary, the HR and Talent leaders of today can continue to meet tomorrow’s business needs by challenging themselves to consider:

3 What are the core challenges and changes impacting HR and Talent?

3 What blend of HR and Talent leaders do we need to successfully deliver the change programmes?

3 Review the strengths and capabilities of our HR and Talent population

3 Do we have the right blend of leaders?

3 How big is the gap between our managers and leaders?

3 Do HR and Talent have the same priorities?

3 How well do HR and Talent initiatives partner with the business?

3 Do we sufficiently invest in the attraction, recruitment, development and succession planning of HR talent?

3 Do HR and Talent have the power to make decisions and influence the business?

3 What does our focus need to be moving forward?

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DrAmandaPotterCPsychol,CSci,AFbPSs,PhDManaging Director

Amanda is the founder and Managing Director of Zircon and has worked in the Psychology and talent arena since 1995. Whilst her experience and expertise spreads across all of the Zircon disciplines, Amanda splits her time between running the business and building client relationships and delivering client projects. She particularly works with clients to define, design and implement their talent assessment, development, executive coaching and succession planning strategies.

SarahLintonbA(Hons)Direct of Talent Assessment

Sarah has been a Director of Zircon since 2006. Her expertise is talent assessment and development and she has 12 years experience in FTSE 100 companies. Her experience and expertise is in the areas of recruitment and assessment for Director and C-suite level appointments, assessor training, career development, succession planning, designing and delivering assessment centres, conducting outplacement counseling and career planning and campaign management.

MelissabentleybSc(Hons)MScBusiness Psychologist

Melissa joined Zircon in 2010, following the achievement of her MSc (Distinction) in Occupational and Organisational Psychology at the University of Surrey. Since working at Zircon Melissa has become actively involved in managing projects for clients and is involved in a wide spectrum of activities including assessment, training and product design. Melissa is a Graduate Member of the British Psychological Society (BPS) and is an Affiliate of The Association of Business Psychologists (ABP).

katiebissellbSc(Hons)MScBusiness Psychologist

Katie gained international cultural experiences, living in Hong Kong, Australia and Germany. She has gained work experience in a variety of roles including working within the NHS mental health services, not-for-profit organisations, customer service and retail, the airline industry and hospitality. She has gained valuable insight into how people behave in different cultural situations. Through these work experiences and her University studies, Katie has assisted individuals to view their work more positively, conducted group training sessions and designed bespoke research materials.

JadebennettbSc(Hons)Business Psychologist

Jade has broad experience across multiple domains including working in medical health, care, professional sport, and hospitality sectors, both within the UK and France. Following the completion of her degree, Jade joined Zircon and has been involved in a wide range of tasks including project management, assisting the development of talent assessment tools, report writing, proposal development, proofing assessment reports and client materials, development of user guides for large client projects and keeping up-to-date with current research.

Thank you also to Sarah Green and Lucy Elmer, without whom all of this would not have been possible.

Contact Us:To find out more about our talent consulting offering, please visit our website www.zircon-mc.co.uk or call the Head Office on 01737 555 862.

About the Authors:

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ReferencesExecutive Office, Talent Management Team. United Nations Joint Staff Pension Fund. New York Secretariat Headquarters. Traditionalists, Baby Boomers, Generation X, Generation Y (and Generation Z) Working Together. WHAT MATTERS AND HOW THEY LEARN? How different are they? Fact and fiction. (2009).

Kreissl, B. (2011, July 26). Improving HR’s Image. Combating negative, outdated stereotypes. Candaian HR Reporter. Retrieved from http://www.hrreporter.com/blog/HR-Policies-Practices/archive/2011/07/26/improving-hrs-image

Smith, B. & Rutigliano, T. (2002). The truth about turnover. GALLUP Business Journal. Retrieved from http://businessjournal.gallup.com/content/316/truth-about-turnover.aspx

Ulrich, D. (1998). Delivering Results: A new mandate for human resource professional. Harvard Business Review, 76, 124-135.

Ulrich, D. & Brockbank, W. (2008). The business partner model: 10 years on- Lessons learned. Retrieved on 15th October 2013, from, http://www.hrmagazine.co.uk/hr/features/1014777/the-business-partner-model-lessons-learned

Zircon Management Consulting. (2012). The Future of Talent Management. Coulsdon, Surrey: Potter, A., Lee, J., & Linton, S.

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1.MakesCalculatedDecisions Decisive and rational, leaders

with this capability use their analytical skills in order to make robust and objective decisions, which benefit the wider business. They take ownership of decisions and empower others to do the same, encouraging a trusted and supportive environment. They provide a clear rationale for their decisions and readily seek input from others.

2.Innovative&Creative Leaders with this capability

enjoy being creative and they are open to challenging traditional ways of working if there is a better way of doing something. They consider the broader needs of the market and seek to develop innovative solutions. They encourage others to be creative and develop a culture where new ideas are valued.

3.FinanciallyAware Financially and commercially

astute, people with this capability keep their eye on the “bottom line”. They understand key global trends and the associated implications for the organisation, and they therefore respond commercially to get the best financial deal for the business. They demonstrate a strong understanding of financial data and use this to make robust and financially viable decisions.

4.business&IndustryFocused Leaders with this capability

have broad as well as in depth knowledge about the industry within which they work. Furthermore, they research and anticipate economic, technological and legislative changes and understand the implications for the organisation. They demonstrate awareness of competitors and seek ways to respond positively to these challenges.

5.SimplifiesComplexity Leaders with this capability,

analyse and integrate the multitude of complex, ambiguous issues within the organisation and the external market. They take the complex business information and break it down into easy to understand steps and language. They then communicate this information clearly and simply for others, without losing the critical meaning for the business.

6.StrategicThinking Leaders with this capability,

develop longer term objectives consistent with the “big picture” and broader organisational and market factors. They influence desired organisational outcomes by seeing, communicating and modelling how things will be, so others can understand and imagine what the future should look like.

7.builds&SustainsRelationships People and team oriented,

people with this capability demonstrate a sincere interest in others and strive to create effective teams where each individual can add value. They therefore build and maintain positive, two way relationships, collaborating closely with others in order to achieve shared objectives, for the greater good of the organisation.

8.CommunicateswithImpact Impactful and credible,

people with this capability communicate openly with others, adapting their communication style according to their audience and the purpose of their message. They demonstrate active listening skills, ensuring that there has been two way understanding and ask insightful questions in order to constructively challenge others.

9.Influences&negotiatesEffectively

Leaders with this capability are skilful negotiators they know how to influence other people’s opinions and attitudes, successfully gaining agreement and commitment to a particular decision or course of action. They generate win-win situations by understanding what is important, knowing when to push forward and when to compromise.

Appendix 1 – The HR and Talent Leadership Capabilities

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10.CourageousRiskManagement Courageous and bold, people

with this capability go against the status quo, they take measured risks to benefit the organisation and see risk as a way of creating improvements. Individuals with this capability have the courage to act when others hesitate. They anticipate unwanted risks within the business and proactively plan to minimise these risks.

11.DemonstratesResilience Calm and resilient, people with

this capability remain positive and focused under pressure. They are determined to succeed even in challenging or stressful working environments and bounce back from adversity. They use past experiences in order to inform future actions and develop greater levels of confidence in the process.

12.Passionate&Courageous Passionate and courageous,

people with this capability are inspiring and compelling, they convince others of the organisations purpose and gain acceptance from others. Their passion and courage shapes conversations and activities that build focus and wider understanding, and ultimately results in organisational progress.

13.Adaptability&Flexibility Flexible and adaptable, people

with this capability are able to operate effectively within ambiguous circumstances. They adapt quickly and effectively when situations change and they are open to alternatives. They encourage a culture of openness, opportunity and cooperation, particularly when change is required.

14.ActswithIntegrity Highly values driven, people

with this capability treat colleagues respectfully and honestly. They honour their commitments and encourage others to do the same. They treat people fairly and with respect, always maintaining confidentiality. They live and breathe the values of the organisation, acting as role model to others.

15.opentoChange Is open to and accepting

of change, recognising the long term, sustainable benefits for the business. They know when to depart from traditional methods of working and proactively seek to identify obstacles to success and appropriate solutions. Furthermore, they lead and support others through change by providing adequate support and resource.

HR and Talent - zircon-mc.co.uk · Jennie Walton HR Director PRS for Music Jill Hatcher Deputy Head...

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