Is it Time to Rethink the War for Talent?
Business leaders seem resigned to the negative effects of the so-called “war for talent.” Employers, desperate for any advantage in a highly competitive age, focus tremendous energy (and money) filling up their hiring pipeline with talented people. Meanwhile, high performers in the organization slip out the side door for better opportunities and the cycle continues.
Writing in the Harvard Business Review, Wharton School professor Peter Cappelli puts it succinctly:
“Businesses have never done as much hiring as they do today. They’ve never spent as much money doing it. And they’ve never done a worse job of it.”
Cappelli points to two main reasons companies are struggling:
- Employers rarely promote from within — In the 1970s, 90% of vacancies were filled internally, whereas now few hiring managers even look internally.
- Retention has gotten much more difficult — 95% of all hiring today is to fill existing positions.
Cappelli offers several remedies, including requiring internal job postings, getting more realistic about job requirements, and measuring the results of hiring practices.
We think organizations can do even more. And it starts with understanding why the “war for talent” is an inept metaphor that leads to bad business practices.
Wars, real or metaphorical, are defined by their scope — they are what has to be won. You can lose a battle but still win the war. The “war for talent” implies that the ultimate objective is to gather the best troops; an idea that is false in both military and business contexts. The objective of a business is not to win the war for talent — it is to win the war.
The “war for talent” implies that the ultimate objective is to gather the best troops; an idea that is false in both military and business contexts.”
Successful business leaders are focused on driving outcomes, not stockpiling talent.
At Catalant, we’ve seen several forward-thinking companies rethink the relationship between strategy and talent. Rather than making marginal improvements to hiring practices and philosophies, these organizations improve total business performance by focusing on business agility.
Agility Goes Both Ways
The war for talent got a lot harder when things got better for employees. Even beyond the hot job market, today’s employees have several advantages previous generations didn’t, including remote work options and increased skills portability. This gives them agility — employees can more easily than ever change their work situation to better meet their goals.
Business agility is the perfect compliment to employee agility. Both want to deliver on important work. Both want to surmount obstacles like silos and dysfunction.
What is Business Agility?
Business agility means going as fast as possible without losing stability.
How agile is your organization?
Take our Agility Benchmark assessment to see how you stack up to other organizations in your industry.
For senior leaders, business agility means focusing on execution. Simply defining goals and KPIs for the organization is not enough. Leaders need to fully understand the work to be done in order to properly allocate resources and support. The result is better business performance all the way around, from bottom-line growth to retention.
Below are just a few examples of organizations we’ve seen focus on business agility to drive business performance.
Unilever Grows with Expanded Talent Pool
At Unilever, growing the bottom line meant thinking differently about how to access and deploy talent. The organization’s BeResourceful initiative was launched as a way to help business leaders in the organization get out of the war on talent and into a more flexible, modular strategy that leveraged talent bases outside the organization. So far the results include:
- An initiative in Pakistan to develop a new product to guarantee ice cream delivery in 10 minutes or less. The initiative included a hackathon with over 350 ideas, plus a partnership with a logistics company that developed a dedicated AI platform for the product. The result was an additional 1% growth in the 1 billion Euro market.
- An effort to launch five new beauty products in Indonesia with limited marketing support. By filling the gap with temporary marketing talent accessed through the Catalant platform, the division was able to successfully launch all five new products in nine months or fewer.
- An initiative in China to market a shampoo brand to millennials. With few millennial workers on the team, Unilever created a crowdsourcing campaign that helped create a successful new campaign in only two months.
Agile organizations are able to…
Make decisions 3x faster
Agile organizations are able to…
Develop products 5x faster
Anheuser-Busch InBev Takes a Fresh Look at Internal Talent
Rethinking the war on talent doesn’t necessarily mean looking to supplement in-house talent with external talent. In the case of Anheuser-Busch InBev, the focus on business agility meant finding new ways to identify and access the right skills for the company’s key business initiatives.
To combat disruption, Anheuser-Busch InBev sought to disrupt itself. For example, in 2015 the company launched ZX Ventures with the mission to fund and support potentially disruptive ideas both inside and outside of the company. The initiative was part of a broader effort to tap into the best resources and ideas, and to move quickly to close the gap between strategy and execution.
“We have over 200,000 people in our company. Most of the expertise, most of the knowledge that we are looking for in the market, we already have,” says Fabio Kapitanovas, VP of People and Management at Anheuser-Busch InBev.
To encourage leaders in the organization to think more flexibly about aligning talent to strategy, the organization is also changing compensation models to encourage dynamic re-prioritizing of critical projects rather than static annual goals.
“We have over 200,000 people in our company. Most of the expertise, most of the knowledge that we are looking for in the market, we already have.”
– Fabio Kapitanovas, VP of People and Management, Anheuser-Busch InBev
Shell’s Innovation Exploration
At Shell, a highly volatile market landscape led the organization to rethink nearly everything about how it executed on strategy. The company had grown to be one of the largest oil & gas companies in the world, but pressure from climate change and digital disruption meant change was in order.
“We realized we needed to do a lot more commercial innovation, and started to look at what that meant. And we realized that meant a lot of experimentation, digital innovation, and incubating ideas. We recognized pretty quickly we were not set up with the resources and talent to actually drive that.”
To address the challenge, Missen and her colleagues set out to test new ways of driving innovation. One of the first projects they launched was a reverse mentoring initiative, in which the team identified 50 people within Shell who were qualified to help senior leaders understand different aspects of digital innovation (eventually 8 of the 50 were selected to participate). Missen says the initiative showed them how limited job titles are when searching for specific capabilities for a defined project.
“What was interesting was that these people came from all parts of the organization, and very few of them were working in what we’d call digital roles. Most of them were pretty junior in the organization and they were hidden,” says Missen.
The success of that project sparked a larger initiative within Shell to think differently about how it could close the gap between strategy and execution by quickly aligning new projects to strategies, accessing and allocating the right people and capabilities to those projects, and tying the results of those projects to business value.
Using Catalant as a platform for tracking and organizing projects as well as the skills and interests of its employees, the Downstream Commercial business started by encouraging people to use their discretionary time (about 20% of their total work time) to work on projects throughout the organization. The “Opportunity Hub,” as Shell calls it, has already started to pay dividends. In one case, Missen says, an employee in Houston was able to produce real results on an eight-week supply chain sustainability project after locating an employee with the right skill set working in a manufacturing plant near Cairo, Egypt.
“We absolutely believed that this is one of the things that’s going to change our company,” she says. “People love the fact that they get access to opportunities and projects they had no visibility into in the past.”
We’re looking at how we can efficiently access and use the diverse talent we already have in Shell.”Caroline Missen
Read about Shell’s Opportunity Hub in the Wall Street Journal