In the first part of this article, we defined management by objectives and regular performance and potential analyses as important, fundamental systems in a company’s management culture. How can these approaches be meaningfully supplemented with other management systems? How do they interlock as gears to benefit both the company and the employee? What is the logical sequence for implementing these systems?
Talent Management
The first step is to establish sustainable talent management. Let’s look at working in a company from the following perspective: as people accumulate, so does talent within an organization. Over time, this results in a sum of knowledge and skills (or: competencies) that need to be managed – a classic task of the HR organization and managers. It is primarily a matter of managing and coordinating talent in its entirety (“the right person in the right job”) and developing it further, thereby shaping it into careers.
How can talent management be structured chronologically?
1. structuring
The structures are determined on the basis of the previously defined corporate objectives and the associated strategies (“structure follows strategy”). This involves defining, for example, how many jobs with which competencies are needed for what, how many hierarchy levels there should be or which jobs are key positions. In short, it is about determining the optimal division of labor.
2. job planning
The structuring is accompanied by the definition of target competencies for the individual positions. Based on these definitions, an individual target/actual comparison can now be carried out with the help of regular performance and potential assessments. The assessments are used, for example, to optimize the deployment of employees within the company, for further development in the existing position or for a new position.
If the target/actual comparison reveals a difference, it is rectified through personnel development measures. This means that these are no longer just a means to an end, but become target-oriented management tools. For example, employees can be developed at an early stage to meet the required competencies of another (e.g. more senior) position. The same applies to leadership skills. They are also defined as a target in the context of management positions (e.g. derived from overarching management principles) and compared with the existing actual competencies of the job holder. Any target/actual differences identified are then reduced, e.g. in management training courses.
Job planning also makes internal career paths more transparent and allows you to show employees possible internal prospects more easily.
3. personnel planning
Personnel planning supplements position planning by regularly reviewing the specifications made as part of the organizational structure. In all areas of the company, a comparison is made, for example on an annual basis, of the employees available and required in the company. The inclusion of the associated personnel costs extends personnel planning to personnel cost planning. If salary budgets are made available to those responsible for costs as part of personnel cost planning, a genuine control element is created as part of the management of the company.
The implementation of these planning measures is primarily the responsibility of the HR departments.
4. succession planning
Succession planning is often neglected, although it only involves a manageable amount of additional work. As the name suggests, this systematically defines and monitors who is intended as a successor in which position. This is an effective management system for keeping an eye on foreseeable individual personnel measures (e.g. retirement) in good time and being better prepared for replacements in the event of unplanned staff departures. Here, too, personnel development tools can be used in a targeted manner.
So if you want to manage talent in companies in a planned manner, there are a number of effective management systems available to you. Cleverly organized, these systems work together and can make HR and management work much easier. Nevertheless, not all or only a few of these tools are used consistently in many companies.
If talent management is used to create efficient management processes and structures within the company, this provides an important basis for inspiring employees and, in the next step, retaining them in the company in the medium to long term.
5. employee retention
There have always been reasons to keep one or two employees in the company who have made a particular contribution to the company’s success. However, we can confidently define targeted, planned and overarching employee retention measures generated from a certain conviction as a management system.
But why is the topic of employee retention so important today and why should employees be retained by companies at all? There are many correct answers to this question. But the central point is: it really does exist, the “battle for talent”. Whether a company wants to form the most effective sales force against direct competitors, another wants to fill all of its key positions with high potentials or wants to secure the best graduates from a university – the demand for good employees varies, but is nevertheless consistently recognizable.
The current framework conditions are also contributing to this struggle. Currently and in the near future, there is an employee market in which applicants can largely choose the company that is right for them, with the greatest possible transparency right down to the corporate structures and processes and with advancing globalization. The much-described Generation Y no longer just accepts, but asks questions and wants explanations; financial matters are not the sole focus.
There are also internal reasons for companies to avoid high staff turnover. These include, for example, high recruitment costs for new appointments, the loss of know-how when an experienced employee leaves, the resulting unrest in the team, etc. There are therefore a number of valid reasons for the employee retention management system.
But what should such a system look like? Are purely financial incentives, such as salary and an extensive bonus offer, what counts here? Is it more about good working conditions and social components? How important are the aforementioned well-functioning systems and processes? Certainly, as is so often the case, what counts is an attractive and, above all, authentic “overall package”, whereby it is a matter of consciously addressing the advantages of the organization and working out the appropriate measures for employee retention.
These benefits identified within the organization result in an increase in the company’s attractiveness to the outside world. According to the motto “Do good and talk about it”, it is perfectly permissible to communicate the advantages of a company to the outside world in a next step and use them to advertise. In the form of employer branding, the whole thing becomes a management system as a targeted, planned course of action.
Employer branding
As described above, employees are increasingly in a position to choose which employers they want to work for. In order to make their choice as difficult as possible, many companies are now trying to emphasize their attractiveness. With employer branding, the employer itself becomes a brand, promoting its benefits primarily for the purpose of employee recruitment and retention. As with a product or service, the same applies here: the brand must ultimately deliver what is promised in the marketing.
In order for employer branding to systematically focus on the best possible external impact, the conditions for this must first be created internally, as described above. The “employer brand” will be most effective if it authentically and honestly reflects the actual (and not the desired) advantages of the company. To use sales jargon: don’t sell anything here that you don’t have.
Final chapter
The use of suitable management systems in practice creates the basis for a performance and employee-oriented attitude in the company. Those who know how to apply these management systems comprehensively and use them professionally create recognizable advantages in the company, which are suitable for ensuring that employees feel fairly treated and comfortable and are happy to remain loyal to the company in the medium and long term. Coupled with an authentic corporate and management culture and a cleverly chosen strategic direction, the employer becomes a brand whose benefits can be communicated and presented to the outside world with a clear conscience as part of employer branding. Employees will be able to distinguish real benefits from empty promises.
by Uwe Conradi, trainer at Lorenz-Seminare