Winning the War for Talent
It’s been nearly 20 years since McKinsey & Company first introduced its groundbreaking study, The War for Talent, highlighting the importance of recruiting the best leaders as a strategic business challenge and a critical driver of corporate performance. The talent war wages on today, but conventional warfare has changed, thanks to increasing diversity, technological advancement and a more mobile and global workforce. Remaining competitive in the war for talent requires strategies to address these evolving challenges in order to recruit, retain and develop top talent.
For our Spotlight SeriesSM breakfast on June 6, we invited a panel of experts to share their thoughts on what it takes to win the best leaders in today’s war for talent. Our esteemed panelists included:
- Glen Goodman, Vice President of Global Talent Acquisition, Sabre
- Lisa Nelson, Senior Vice President of Human Resources, Match Group
- Warren Strickland, Senior Advisor and Director Emeritus, McKinsey & Company (and Pearson Partners board member)
- Stephen Konstans, Vice President, Pearson Partners International (Moderator)
Changing Work, Changing Workforce
At the time The War for Talent was written in 1997, attracting, retaining and developing talent were big challenges, and twenty years later, they are even more so as organizations compete in our global marketplace.
Today’s business leaders are concerned about retaining their employees in an increasingly competitive recruitment market, protecting their proprietary data and engaging employees so they stay longer. In an online world, candidates can easily develop a realistic hypothesis about a potential employer’s culture, brand and values. Enabled by technology, talent management and career decision-making happens faster now than ever before.
The talent pool has also changed, thanks to increasing globalization, as has the work, with technologies such as machine learning making some jobs irrelevant even as they create new employment opportunities. Some industries are showing a shift toward using freelancers rather than full-time employees. All of these changes mean companies must think differently about how they attract, retain and engage talent.
The Culture Question
Many companies still follow traditional processes for assessing and recruiting new employees. It’s common for companies to seek workers that fit their culture, yet it’s also wise to consider whether introducing a “culture disruptor” might be a healthy move. Recruiting to fit the culture is only a positive if the culture already works well. Hiring workers to fit a broken culture only magnifies existing problems. For some companies, it may be best to hire people who don’t fit in and can drive culture change.
However, it’s important to introduce disruption carefully. Hiring someone to come in and change the culture often results in the current culture rejecting the new person, as the existing teams may feel their work is being criticized. Often, when a new hire doesn’t understand the drivers of the existing culture, their change efforts are met with resistance.
Instead, companies that bring in a catalyst for change could ask the new executive to spend six months observing—immersed in and learning about the culture and the company’s values and environment, navigating organizational politics and building a followership before initiating change. It may also be helpful to hire an entire team at once to act as a force for change.
Culture is just one factor to consider in hiring, and it’s far from the most important. Any hiring initiative should begin with defining needed skills and assessing candidates to ensure they have the right capabilities.
Pay Parity vs. Total Rewards
Compensation will always be one of the biggest drivers in the employment market. But increasingly, attracting and retaining top talent requires much more than a big paycheck. Today, companies must go the extra mile to strike the right balance of pay and benefits that keeps employees happy and successful.
Younger workers are particularly concerned about pay parity, with some even going so far as to expect time off to evaluate other opportunities and come back to the table to negotiate. This new generation of talent is more transactional and less loyal. Companies must balance workers’ expectations with cost-of-living factors in various areas where they do business, as well as with competitive factors and individual and company performance.
With pay becoming increasingly transparent and competitive, companies must learn how to win the war for talent based on a total rewards package rather than individual compensation. One way to make this work effectively is to find the value proposition that will engage employees. Some ideas from our panelists include:
- Channel a sense of purpose. Give employees opportunities to serve the greater good through their work. This can be especially helpful for attracting and retaining former military or government employees who wish to transfer skills to the private sector.
- Appeal to individual motivators. Find out what’s important to your talent pool—whether it’s perks or time off or travel—and offer it.
- Give people freedom to innovate. Opportunities to contribute to innovation help people find meaning in their work. For example, Google allows employees to spend 20 percent of their time working independently on what they think will most benefit the company, a freedom that has resulted in popular new products.
- Have a claim to fame. Everyone wants to be part of a winning team, so tell prospective employees what you’re “the world’s best” at doing. Prove that your organization is a high-talent place they want to be part of.
- Sell your location. Convince job candidates that the city where they’ll be working is a great place to live.
- Provide networking opportunities for newcomers and their spouses. Too often, companies lose good people after they’ve relocated because the new hire and his or her spouse never find a community.
The war for talent within American businesses is not limited to the U.S. talent pool, yet the current geopolitical environment and uncertainty are presenting additional challenges for companies seeking to attract and retain good people.
With immigration and diversity as hot topics in the news, companies are grappling to balance inclusivity with potential legal concerns. Immigration is one facet of a diverse recruiting strategy, but publicly stating support for open, inclusive immigration policy can isolate employees, board members or investors. Companies must use nuanced dialogue as they strive to empathize with the uncertainty their immigrant employees may be experiencing, without damaging stakeholder confidence.
To win today’s war for talent, companies must invent new approaches to attract and retain employees in ways that reflect the changing employment landscape, the evolving nature of work, an increasingly mobile and global workforce, and the many impacts of technology.
With all of these trends in play, the value that Pearson Partners can offer to clients matters now more than ever. Our immersion in a changing business and employment environment spans multiple industries, honing our expertise while building our network of connections and presenting more opportunities to help both candidates and clients win the new war for talent.
Pearson Partners Spotlight SeriesSM Breakfast
Save the date for our next Spotlight SeriesSM breakfast scheduled for September 12. Look for details and invitations in August. Did you miss one of our Spotlight SeriesSM events? Check out summaries of past events.