Leading industry experts answer your strategic questions

Citation

Landsberg, M. (2010), "Leading industry experts answer your strategic questions", Strategic HR Review, Vol. 9 No. 5. https://doi.org/10.1108/shr.2010.37209eab.004

Leading industry experts answer your strategic questions

Article Type: Q&A From: Strategic HR Review, Volume 9, Issue 5

How should the board be involved in talent management?

Max LandsbergBased at Heidrick & Struggles.

Poll after poll shows that boards most want to spend more time on understanding the talent in their organizations. For example, a recent McKinsey survey found that 53 percent of boards would like to increase the amount of time spent on talent management (The McKinsey Quarterly, 2008). It is natural for them to seek out best practice as a guide, but there are few published standards for the board to follow, no equivalents to the regulations that guide financial custodianship, and few agreed principles such as those employed in market research to scrutinize the customer base.

In the absence of a standard framework, we have crafted 20 questions to stimulate discussion and act as an accessible checklist for the board director and HR leader to use – see list below.

A checklist for talent assessment:

1. 1.

   Direction

   • •

     Do we have a talent strategy, and does it support our business strategy?

   • •

     Do we have a set of principles that reinforces all aspects of talent management consistently?

2. 2.

   Champions

   • •

     Are our most senior executives competitive versus the external talent market?

   • •

     Have we identified successors for the most pivotal roles?

   • •

     Do we have a robust pipeline of leaders and managers?

   • •

     Do we have an effective board that contributes to the business?

3. 3.

   Engagement

   • •

     Is our employer brand more attractive than competitors, to both current and potential employees?

   • •

     Do we “own” relevant channels for attracting talent?

   • •

     Do our employees feel engaged and loyal to our organization?

   • •

     Is the turnover of strongest performers sufficiently low?

4. 4.

   Performance

   • •

     Is performance measured, managed and communicated properly?

   • •

     Is there a clear process for planning succession, and is it used well?

   • •

     Is our workforce planning based on a robust understanding of strategic needs and the dynamics of the various different employee segments?

   • •

     Do we recruit effectively and efficiently?

   • •

     Do we onboard people in ways that accelerate early performance and later retention?

   • •

     Do we promote and exit the right people at the right times?

   • •

     Is development delivered as and when needed, for the various segments of our talent?

   • •

     Do we reward people appropriately?

   • •

     Do we make the most of our alumni networks?

5. 5.

   Review

   • •

     Do our metrics for managing talent provide insight and point to required action; does the board review it in enough detail; do board members know the profiles of key managers in depth and by heart?

They are designed to help organizations ensure that talent is indeed being managed and developed in ways that support the business strategy and create the necessary conditions for superior performance. The questions are the result of Heidrick & Struggles’ extensive experience in working with a range of boards and managements (CEOs and HRDs). They are divided into five areas that follow a logical progression: direction, champions, engagement, performance and review. Taken together, these areas address comprehensively the three crucial governance questions implied by the commercial goals and strategy of the organization:

1. 1.

   What leadership and talent do we need?

2. 2.

   What leadership and talent do we have?

3. 3.

   How do we close any gaps, and keep them closed, to mitigate talent risk?

While some of the questions need only a simple yes or no answer, the implications for the business can be nonetheless significant. For example, if the answer to question 6 “Do we have an effective board that contributes to the business?” is “We have no way of telling”, then it is apparent that some form of assessment from a third party is desirable to conform to best practice.

Since few boards will address all these topics in a single board meeting, some boards have established a rolling agenda for scrutiny and debate, and others have established a formal talent management committee with participation from HR and one or two (other) board members to consider the questions, collect the facts and then report to the board with a set of recommendations as to how to move forward. To stay objective it is often necessary to include stakeholder opinions from around the organization. For example, call up the recruitment firms you work with to find out how your brand is viewed by candidates in relation to your competitors. Exit interviews with people you are reluctant to lose provide another valuable opportunity for candid feedback.

These issues cannot be marginalized as being “soft”, since the direct costs of recruitment and the indirect costs of underperformance when people are not developed well are huge. The ultimate price of poor talent management is apparent when a CEO leaves without an internal successor and leaves a void at the top. Share prices in listed companies then tumble as the organization conducts a search (often public) from the back foot. This is never a desirable situation, and it can be avoided if active talent management creates a pipeline of potential internal successors who ultimately will keep the ship sailing smoothly if there is trouble at the top.

About the author

Max Landsberg co-leads Heidrick & Struggles’ Leadership Consulting Practice in the UK. This practice includes work in talent management, executive assessment, leadership development, corporate governance and executive coaching. He joined the firm after 16 years with McKinsey & Company where he was a partner, and after five years running his own practice in leadership, coaching and assessment. He holds degrees in Theoretical Physics from Cambridge University, and in Business Administration from Stanford University. Max Landsberg can be contacted at: mlandsberg@heidrick.com