If your company has trouble hiring, developing and deploying talent — building bench strength — the problem might lie with you, the business owner. So, before you point fingers and lament about the talent shortage, look in the mirror.
“In an ideal world, the business owner is fully engaged in designing, developing and nurturing a strategic talent management system,” says Stacy Feiner, business psychologist and management consultant at BDO USA, LLP.
Business owners need to know their people as well as they know their numbers. They have a responsibility and the privilege to define the core expectations they want in their employees’ behavior and performance.
When an owner is detached from talent management — defining the expectations and thus the processes to get to those expectations met — the culture may unwittingly become a reflection of their worst traits, Feiner says. Long-standing distraction from shaping your culture can lead to neglect, and neglected environments will result in a slow decline, at best, or create organizational injustices like ignoring internal conflicts or undermining employee attempts to add value.
Smart Business spoke with Feiner about the mistakes business owners make and how they can overcome those to strategically build bench strength.
Where do business owners falter when it comes to talent management?
Many business owners see talent management processes and capabilities in isolation. They look at recruiting as a transaction, a cost and sometimes as a necessary evil. In contrast, succession planning is viewed as a strategic initiative that is supported with a budget and encouraged by the board. But really, succession planning and recruiting are different sides of the same coin.
Just think about professional sports teams — they don’t outsource recruiting because it’s a critical capability. Ultimately, people drive the numbers. That’s where your focus should be, even though human dynamics are challenging and not all business owners are interested or good at managing them.
Another concern is when business owners don’t have a mechanism to evaluate talent across their enterprise. This intelligence is already there; you just need to gather, package and translate it for employee development and succession planning. Think about how much easier it is to build bench strength with a clear picture of your current talent’s skills, potential, tendencies and temperament. People, generally, change jobs 14 times throughout their career, so why shouldn’t you leverage those changes? If your company is growing, the natural indication is to look out, rather than at top performers inside the business.
Also, once you’ve evaluated your talent, there needs to be a method for providing honest feedback on performance.
How can business owners recognize if they’re detached from their talent management practices?
The signs of detachment are pretty straightforward: not having a budget for talent management; holding a view that the activities of human resources and talent are an expense; and pushing talent management off to HR, without giving enough vision, insight or instruction.
What other critical elements help your company build bench strength?
It’s a mindset. Part of a business owner’s job is to shape the culture that in turn nurtures talent. It’s not HR’s responsibility to manage talent; HR must facilitate the owner’s talent initiatives and directives. It is HR’s job to partner with managers, so that together they can manage and meet employee expectations.
In the early 1980s, General Electric’s Jack Welch popularized the concept of talent management, and a disciplined system, that trickled down to the middle market. The middle market, however, wasn’t nearly as successful at developing culture and adaptive talent. What got lost in translation is that it wasn’t Welch’s system that created the success; it was that he used his philosophy.
Each business owner must define his or her own philosophy about people, in order to create the mechanisms and an integrated process to accomplish and achieve those expectations. You must be involved. And once you become engaged, it will create its own momentum.
Insights Accounting & Consulting is brought to you by BDO USA, LLP
