What Is Talent? DAVE ULRICH & JOE GROCHOWSKI

RBL Institute
What Is Talent?
DAVE ULRICH & JOE GROCHOWSKI
THE RBL INSTITUTE | MINI FORUM WHITE PAPER | NOVEMBER 2011
Participating RBL Institute Members:
Lynne Segall, Accenture | Rick Vanasse, Bon Secours | Lisa George, Cardinal Health | Yuvi Bhasin, Deutsche
Bank | Sandy Lionetti, GroupM | Jo Eisenhart, Northwestern Mutual | Beth Motzenbecker, Pfizer | Dalila Dabbicco, Prudential plc | Paula Loop, PricewaterhouseCoopers | Lyndsey Lewis, Rio Tinto
O
ur Premise: There are so many frameworks, tools,
“Talent” is not an abstraction. By investing properly, com-
platitudes, programs, and promises in the talent
panies receive real value from building better talent from
domain that it is easy to get confused. Talent has
employee productivity, customer loyalty, investor intangibles,
become a rather nebulous term. The volume of talent confer-
and community reputation.
ences, workshops, and webinars have become affirmations
that talent matters, acknowledgement that leaders must
invest in talent, recognition that training alone is not sufficient
for developing talent, awareness that employee engagement
does indeed lead to higher productivity and renewed commitment that good employees need to be hired and retained.
Executives often leave these talent workshops and webinars
having checked off the talent review box, but not really making concrete progress on improving talent.
A F R A M E WO R K F O R D E F I N I N G TA L E N T
Executive teams talk about talent all the time and almost all
agree that talent is important, but the term talent becomes
less relevant when executives talk in vague terms about
talent. The RBL Group has created a simple framework (see
Figure 1) that looks at four different definitions of “talent” and
enables executives to invest in the unique development needs
of each talent stakeholder.
Figure 1: Overview of Talent Pyramid and Choices
1: C-Suite Executives: Succession, Customization, Teamwork
2: Senior Business Leaders: Square Root of X
3: High Potentials:
4: All Employees
What is Talent? | TheRBLGroup ©2011
5–15% of people, 5–15% of the time;
Personal Development Plan
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1. The C-suite: A primary focus with c-suite executives
is on managing succession—preparing backups on the
tal experiences, and external opportunities to learn.
e.Create measurement mechanisms to track leadership
succession plan and identifying the requirements to fill
success. For example, measure the export and import
senior leadership roles. Development for the c-suite should
of leaders in the company.
be highly customized to continue to nurture and develop
3. High potentials: The old rule of thumb to define a high
them. For example, you may want to develop someone in
potential was whether or not a person could make two
this segment by getting him or her involved in external
vertical moves in five years. RBL’s rule of thumb is this
boards. Teamwork should also be another important focal
group should be about 5–15 percent of the workforce and
point for this group. You need to make sure the c-suite is
about 5–15 percent of their time should be spent on de-
functioning well as a team and that you are assessing the
velopmental experiences. Our definition of what it means
team dynamics.
to be high potential looks at four factors:
2. Senior business leaders (key leadership cadre):
RBL’s rule of thumb is that this segment of talent should
equal the square root of the total number of employees.
For example, if you have 200,000 employees, your key leadership cadre should be about 450 people. The goal with
your key leadership cadre is to develop a systematic way
of building this group of leaders. Here are a few steps:
a. Build a clear business case for leadership.
b.Have a clear theory of leadership. Every company has
a leadership competency model, but these models
tend to be internally focused. The RBL Group suggests
that you also include outside stakeholders when you
build your leadership competency model. For example,
does your model incorporate customer expectations?
Our research on The Top Companies for Leaders
shows that those ranked as Top Companies incorporate outside/in elements in their competency models.
c. Have a clear way to assess people against your
a.Ambition
b.Agility
c.Ability
d.A pattern of achievement
Of the 5–15 percent of the time spent on high potential
development, we suggest that 50 percent of the development should include coaching and mentoring; 30 percent
should be spent on training; and 20 percent should be
development opportunities outside your company—such
as philanthropy.
4. The company as a whole (all employees): The key
question here is are you creating a culture dedicated to
building talent? We argue that there are three parts to
talent:
a.Competence: Does the individual have the required
knowledge and skills?
b.Commitment: Is the individual engaged?
c.Contribution: Is the individual able to find a sense of
theory of leadership.
d.Make sure you are investing in training, developmen-
meaning and purpose at work (see Figure 2)?
Figure 2: Talent Overview
Talent, Workforce, People
Talent =
COMPETENCE
Right person, right place,
right time, right skills
• Set standards
• Assess
• Invest
• Integrate
What is Talent? | TheRBLGroup ©2011
X
COMMITMENT
Enact an employee value
proposition
• What do I get?
• What do I give?
X
CONTRIBUTION
Create meaning at work
• Identity
• Purpose
• Relationships
• Work environment
• Work itself
• Learning/resilience
• Civility
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GROUP QUESTIONS AND ANSWERS ON TALENT
During the call we asked participating Institute members
to share any questions or comments they had about talent.
Below is a recap of the comments.
culture), “emotional intelligence,” “intellect,” and “engagement”
(with the company and its values). This approach encourages
managers to think more broadly about their assessment of potential and ensures they are not focusing on past performance.
Deutsche Bank: Through talent reviews we make sure we
Defining High Potential
calibrate performance and potential.
Deutsche Bank: We have a talent review process in place
Bon Secours: We have end-of-year reviews that focus on
and have found that as the process has matured in the Bank
performance. But we also do mid-year reviews that are much
the quality of the data and discussions around talent has
more focused on development and aspirations. About 80 per-
improved. In talent review conversations we tend to find
cent of the mid-year review is focused on development with
the anchor of the discussions is more on performance than
the other 20 percent spent on performance. For the end-of-
potential. How do other companies define high potential?
year review, it’s the opposite—about 80 percent is spent dis-
What tools / approaches have helped shift the discussion from
cussing performance and about 20 percent on development.
performance to longer potential?
Cardinal Health: We look at the person’s track record of
Tracking High Potentials
performance over time, assess the person against our leader-
Accenture: We are interested in finding better ways to track
ship behaviors, which we call “leadership essentials,” that
include internal and external factors, and we have realistic
discussions about whether the individual is willing to do
what it takes to be a high potential (which we define as the
our high potentials.
Bon Secours: We use a company called Success Factors that
tracks our high potentials against our 9-box grid.
ability to move two levels). We find it is hard for managers to
Deutsche Bank: We also use Success Factors, which
assess ambition. The goal is to get our managers to have a
provides the ability to track the outputs of our global talent
realistic discussion with employees. We tend to find that some
reviews.
managers define high performers as high potentials but a high
performer does not always equal a high potential.
Pfizer: We use PeopleSoft. We have customized their tool a
lot so we can do the type of tracking that we want. A question
Deutsche Bank: We have worked over the years to clarify
I have for the group: what are you doing around individual
our definition of potential. Some of the thinking right now is
development plans?
to anchor it to tangible factors such as readiness to move to a
larger role.
Dave Ulrich: When you are trying to determine whether
Bon Secours: During our mid-year reviews an individual development plan gets created and it is included in our Success
Factors tool to look for trends and themes.
or not a person is willing to do what it takes, we find HR
can do some important “behind the scenes” work to ensure
that people are not put in a situation where they are offered
a promotion they can’t take. For example, before you offer
someone a new role or promotion, HR can talk to the person
beforehand to see if the new role or promotion fits in with his
or her current family situation (e.g., maybe they can’t or don’t
Developing High Potentials
PwC: After we do our high potential analysis we make
sure there is transparency to educate the individual and the
coaches. What innovative things are other companies doing to
develop their talent?
want to relocate).
Bon Secours: We use 360-degree feedback and coach-
Pfizer: We have a learning agility questionnaire with about
ing and all the feedback is shared with the coach to build it
82 questions. We look at three factors: input from colleagues,
into the development plan. We use both inside and outside
performance, and talent review conversations.
coaches.
Rio Tinto: We provide managers with a template outlining
Dave Ulrich: We are finding that if you spend X dollars on
the key indicators of potential within Rio Tinto, which are “aspiration,” “alignment” (with Rio Tinto’s safety and behavioral
What is Talent? | TheRBLGroup ©2011
a training program and add X additional dollars on coaching
along with the training, the total cost goes up by about 20
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percent but the impact goes up 50 percent when you add
Deutsche Bank: In some of our divisions we have disclosed
coaching on top of the training.
the 9-box grid position to the employee but in others we
Cardinal Health: We have three high potential programs
and all three have external coaching built into the programs.
We also use mentoring and engage mangers of the participants (done both pre and post the mentoring).
Northwestern Mutual: For our c-suite candidates we use
an external coach to do a 360 process and help create a development plan with the individual. Then, the direct manager,
the CEO, and CHRO work together with the coach and the
individual to ensure alignment with the plan and progress is
made in development.
Accenture: In one of our management consulting programs,
the person gets one hour with an external coach. The people
who have gone through this program find this to be the most
beneficial part of the program (it’s also the most expensive
part of the program). We also have a program for a select
group of our women where they are partnered with external
haven’t. Our experience is that where the process is more mature we are able to have open and honest conversations. It really depends on the experience of managers and the maturity
of the process. Transparency will be accepted and expected if
the maturity is there.
Cardinal Health: We tell people if they are high potential.
This is new for us. We find that some managers handle it a lot
better than others. The question that often comes up is: what
about the rest of us who are not considered high potential?
We stress that everyone has to have developmental opportunities. We steer people to other development opportunities.
We have a tool called “Development is as easy as 123”—it’s
a tool for managers to develop the rest of their people. Every
employee can have development plan.
F I N A L G R O U P CO M M E N T S
communications coach and they also get one-on-one follow-
To end our discussion, we asked each participant to share
up sessions. It’s a very high touch program but it has a huge
something innovative they are doing around talent or some-
yield. Currently, we are building a program for most of our
thing they are currently focused on with respect to talent.
c-level staff that incorporates high-level coaching. It is costly
Below are the final comments.
but provides a lot of value.
Accenture: We are doing customized training programs
For the program we have for our women, we have seen
(university model where you can customize around your
promotions increase. The percentage of total promotions went
schedule).
from 17 percent to 25 percent in one year. The coaching in
Bon Secours: We have nine-month training program with six
this program focuses on communication skills and there is an
coaches in the program that run a “feedback and formation”
internal sponsor who coaches the women on their careers.
group. People meet with coaches and they also meet as a
GroupM: We are new to deploying coaches. We are trying to
team. So there is team feedback and coaching that adds value
get good measures on the return of this type of investment.
beyond the duration of the program.
The “old guard” sees coaching as an expense for inneffective
Cardinal Health: The way we have integrated our leader-
managers. But there is a culture shift where people see the
ship behaviors (“leadership essentials”) into all aspects includ-
importance of having coaches for high potentials.
ing the culture and the fact it focuses on internal and external
elements.
Transparency about High Potentials
Northwestern Mutual: Development course (People Leader
Rio Tinto: Do other companies share talent assessment infor-
Development Forum) for people before they become people
mation with employees, and openly identify people as high
managers so they can be prepared to move into leadership
potentials? And how do other companies approach the com-
roles. Plus, we’ve created an alumni program for attendees of
munication of the focus on high potentials as a group with the
the course to continue to grow and learn from each other.
broader organization?
Deutsche Bank: We are looking at employee engagement
Bon Secours: We tell people that they are in our 9-box, but
data by different talent segments and have found that there
we don’t share potential numbers. We don’t feel our busi-
are certain survey questions high performers/high potentials
ness is quite mature enough to handle this well, plus there is
tend to rate higher than the average employee.
subjectivity involved in the process. We have given people
GroupM: Integration of talent management across the entire
definitions of what it is to be a “high contributor” and provide
(highly diverse) organization.
feedback.
What is Talent? | TheRBLGroup ©2011
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Pfizer: We have a senior leaderhip program for 800 people (VP and
above) that includes business simulations and this program is now
being carried down to the next generation of leaders.
Rio Tinto: We are looking to ensure talent management is better
integrated with other people management processes including human capital planning, succession planning, and career frameworks.
The focus is on linking talent management outcomes with broader
business plans and HR processes to extract maximun value from
the organizational and individual talent discusssions.
Prudential: We have a long-term development program. It is a
six-year program that includes two job rotations. There are about
ten people in each group.
What is Talent? | TheRBLGroup ©2011
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