Image courtesy of Flickr/Jannis Andrija Schnitzer
Which of your organizational leaders routinely gives up their best talent? Which of them knows exactly when they’ll leave their position to their successor?
Talent management systems often focus on questions like these:
• How many leadership roles have designated successors?
• What is the diversity of our early-stage high potentials moving through a career development path?
• Have we measured the abilities that distinguish great leadership?
• Is our workforce engaged and committed to the organization and its mission?
Many organizations have retooled talent management as a supply chain, evolving from a focus on isolated activities, units or individuals, toward systems that track the movement of talent and capability as a seamless process from sourcing to entry to deployment to exit. The supply chain is a formidable framework for this kind of retooling.
Yet don’t overlook how retooling talent management as a supply chain offers opportunities to engage your leaders in new ways, and how it offers opportunities to recognize great talent leaders who might otherwise be overlooked.
One example is the importance of stepping aside. A video from M&G Investments, a subsidiary of Prudential Financial Inc., depicts Graham French, head of the M&G Global Basics Fund, handing over leadership to Randeep Somel.
The video is for fund investors and brokers to assure them of continuity. It’s also a talent succession primer and a lesson on talent management execution.
In the video, French candidly states that future growth will be in sectors where his successor is better-suited. French and Somel both recount their five-year collaboration to prepare Somel, and they describe other examples of this kind of succession at M&G.
Could your organization make such a video? Do you celebrate and reward your leaders for building talent and then stepping aside graciously?
The bane of any supply chain is bottlenecks in the flow of information, products or money. Smoothing these out improves the supply chain. What are the bottlenecks in the talent supply chain and how do we smooth them?
A common talent bottleneck is when leaders retire too late, holding up the flow of successors — hence the lesson in the M&G video.
Another bottleneck happens when managers say, “I will release my talent to other units, but only when I have a replacement as good or better.” This logic maximizes the single-units performance, but it hurts the organization if moving the talent will add value that offsets the performance drop in the unit they left. This is true even if the releasing unit must take a less valuable replacement. If you wait for a perfect replacement, you may never move anyone.
Why would managers voluntarily release talent when it reduces their unit’s performance, even if it’s for the greater good? In many talent systems, it’s done by force. Yet, in traditional supply chains, managers often happily run “lean” to free up resources for others.
Traditional supply chains have systems like transfer pricing that reward one unit for giving up its resources to another. Managers can actually get financial kudos for being good at transferring resources, even if hoarding them would have increased their individual unit’s performance.
Transfer pricing is often missing from talent systems. Talent systems should use logic and data to discover when leaders should give up talent or step aside. That’s just the beginning.
Talent systems should also celebrate and reward leaders when they release talent or step aside appropriately.
The technology, data and algorithms of talent supply chains are compelling, but like traditional supply chains, success requires that courageous leaders get recognized and rewarded.