Strategic Talent Management Forum
New Era for Talent ManagementToday’s challenges and tomorrow’s opportunitiesKeith Caver, North America Practice Leader, Talent Management and Organizational Alignment, Towers Watson
2 0 1 3 S T R A T E G I C T A L E N T M A N A G E M E N T F O R U M
Workforce SegmentProblems Attracting
Problems Retaining
Critical skill employees 72% 56%
High potential employees 60% 55%
Top-performing employees 59% 50%
All employees 31% 25%
Source: Towers Watson 2012-2013 Global Talent Management and Rewards Study — Global.
Difficulty finding the right peopleand keeping the people you need
2 0 1 3 S T R A T E G I C T A L E N T M A N A G E M E N T F O R U M
Engagement is at risk. It’s not about ‘feeling good’…it’s
about having the tools, colleagues,
time, capacity to fully
commit to work.
““
- Towers Watson 2012 Global Workforce Study
2 0 1 3 S T R A T E G I C T A L E N T M A N A G E M E N T F O R U M
The current state of sustainable engagement of the global workforce
Source: Towers Watson 2012 Global Workforce Study — Global.
2 0 1 3 S T R A T E G I C T A L E N T M A N A G E M E N T F O R U M
Further complicating thesechallenges are other talent realities
Friction points
Structural mismatches
Security
Unsustainability
Skill gaps
2 0 1 3 S T R A T E G I C T A L E N T M A N A G E M E N T F O R U M
global skills
agile thinking
digital business skills
relationship building
The next critical skills
2 0 1 3 S T R A T E G I C T A L E N T M A N A G E M E N T F O R U M
A deeper look at the emerging skill sets
Oral and written communication
Co-creativity and brainstorming
Collaboration
Teaming (including virtual teaming)
Relationship building (with customers,partners, government, etc.)
0 10 20 30 40 50 60 70
% of respondents
Relationship building
0 10 20 30 40 50 60
Ability to see the “big picture”
Managing paradoxes,balancing opposing views
Innovation
Ability to consider and prepare for multiple scenarios
Dealing with complexityand ambiguity
% of respondents
Agile thinking
Ability to use social media and “Web 2.0”
Digital design skills
Understanding of corporate IT software and systems
Ability to work virtually
Digital business skills
0 10 20 30 40 50 60% of respondents
Digital business skills
Global skills
Foreign language skills
Ability to managediverse employees
Ability to work in multiple overseas locations
Cultural sensitivity
Understanding international markets
0 10 20 30 40 50 60% of respondents
Source: Global Talent 2021 Study conducted by Oxford Economics and Towers Watson, 2012.
2 0 1 3 S T R A T E G I C T A L E N T M A N A G E M E N T F O R U M
Future talent friction points
Deficit countries
Surplus countries
At equilibrium
Source: Global Talent 2021 Study conducted by Oxford Economics and Towers Watson, 2012.
2 0 1 3 S T R A T E G I C T A L E N T M A N A G E M E N T F O R U M
Global forces and trends are changing demands on employers and employees
Talent 2021GWS
Transformative HR
TM&R
Ongoing cost pressures and continual belt-tightening in most markets, increasing employers’ focus on maximizing workforce productivity
Dispersed and diverse workforce, enabled by technology to work anywhere, anytime, across national/organizational boundaries in increasingly innovative work arrangements
Dramatic shifts in skill requirements for future growth, coupled with increasing misalignment between supply of/demand for talent worldwide
Pressured, stressed workforce, struggling to do more with less, looking for long-term security and stability in a world that isn’t offering much of either
2 0 1 3 S T R A T E G I C T A L E N T M A N A G E M E N T F O R U M
What are the strategic implications?
UP-SKILL
Re-skill
Creativesourcing
SustainabilityWORK
DISAGGREGATION
technology
develop
2 0 1 3 S T R A T E G I C T A L E N T M A N A G E M E N T F O R U M
How to respond
Retain key people
Hire more from outside
Grow and develop
Improve performance
Raise engagement
2 0 1 3 S T R A T E G I C T A L E N T M A N A G E M E N T F O R U M
Savvy employers will need to thinkdifferently about their practices in the future
Apply the samerigor, effort andsophistication tohuman capitalplanning as to
business planning
Think more broadly– and creatively –
about wheretalent is sourced
Embrace the virtualworkplace andsupport a wide
range of differentwork scenarios
Invest more heavilyin retraining and
reskilling
Rethink andrestructure how
certain workis accomplished
Business rigor
Talent sourcing
Virtual workplace
Re-skillingRethinking
work
2 0 1 3 S T R A T E G I C T A L E N T M A N A G E M E N T F O R U M
Our latest research
• Engagement is at risk• Pay continues to be major headline, but career advancement is the new
retention risk• Talent Paradigm – know the critical roles for future business success; know
your critical talent ; focus your interventions on those holding critical roles,or your talent that shows critical potential – SEGMENTATION
• MIND THE GAP – about EE/ER differences andabout growing engagement gap
Sustainable engagement
2 0 1 3 S T R A T E G I C T A L E N T M A N A G E M E N T F O R U M
Behind these numbers are gaps in areas particularly relevant in today’s environment
Traditionally Engaged
Belief in company goals and objectives
Emotional connection (pride, recommendation)
Willingness to give extra effort to support success
Energy
Can sustain energy needed at work
Have social supports in work environment
Have sense of enthusiasm and accomplishment at work
Enablement
Freed from obstacles to succeed at work
Have resources to perform well
Can meet work challenges effectively
Ensuring people are capable of doing their
jobs well
Ensuring people have capacity to perform at
their best
2 0 1 3 S T R A T E G I C T A L E N T M A N A G E M E N T F O R U M
The payoff for closing gaps in the drivers of sustainable engagement is substantial
Only 17% of employees with high engagement are high retention risks
compared to 58% of disengaged employees
3x
High sustainable engagement companies’ operating margins are
3x higher than those with the lowest levels of engagement
6.5
An average of 7.6 days of lost productivity per year for employees with high engagement vs. 14.1 days for the disengaged
41%
operating margin fewer days lost
lower retention risk
Source: Towers Watson normative database.
2 0 1 3 S T R A T E G I C T A L E N T M A N A G E M E N T F O R U M
The top drivers are influencedby an employer’s value proposition,EVP, and Total Rewards programs
Leadership1 Effective at growing the business Sincere interest in employees’ well-being Behave consistently with organization’s core values Trust and confidence in job being done
Stress, Balance and Workload2 Stress levels at work are manageable Healthy balance between work and personal life Work arrangements are flexible Enough employees in work group to get job done right
Goals and Objectives3 Good understanding of organization’s business goals
and steps needed to reach those goals Understanding of how job contributes to the
organization achieving its business goals
Supervision4 Treats me with respect Encourages new ideas and ways of doing things Acts in ways consistent with his or her words Effective career development conversations
Image5 Organization highly regarded by general public Organization conducts its business with honesty and
integrity
Source: Towers Watson 2012 Global Workforce Study — Global.
Top Drivers of Sustainable Engagement
2 0 1 3 S T R A T E G I C T A L E N T M A N A G E M E N T F O R U M
Differentiate to attract and retain
Use the employee value proposition to drive the right behaviors and performance.
Differentiate for key employee groups.
2 0 1 3 S T R A T E G I C T A L E N T M A N A G E M E N T F O R U M
A formalized EVP helps organizations address critical challenges with attraction, retention and engagement of talent
5Xmore likely to report their
employees are highly engaged
2Xmore likely to report achieving
financial performance significantly above their peers
Companies that have adopted an increasingly integrated approach to Total Rewards strategy, design and delivery decisions — supported by an overarching Employee Value Proposition — are:
2 0 1 3 S T R A T E G I C T A L E N T M A N A G E M E N T F O R U M
Questions