Friday, 1 February 2008

The role of Capabilities in Talent & Organisation Performance

Another FT article that caught my interest this week was Lucy Kellaway's tirade on Accenture's use of jargon in communicating the launch of its book, the talent powered organisaton, in a Second Life event recently.

Now I won't pretend to know what Accenture's new Talent & Organisation Performance service line means by its 'growth platform agenda' but I suspect that Accenture senior executives (senior partners) are quite clear, and that this means something much more precise than just growing the firm's revenues (although I'm sure that's part of it too).

But the need for organisations to “expand their talent management agenda from a narrow and tactical focus on human resources activities around the employee life cycle, to a broad and strategic focus on highly integrated systems of capabilities fundamental to business strategies and operations” makes perfect sense to me.

It's not the people centred language that I think organisations need to use much more in communicating with their staff, but then Accenture senior executives aren't quite the same as most employee populations.

To me, Accenture's use of the word 'capabilities' is terminology, not jargon, and the role of 'highly integrated systems of capabilities' is in fact, exactly what I was talking about in my presentation at Learning Technologies this week.

Capabilty is a similar concept to core competence, but whereas core competence focuses on business processes, organisational capability deals with management processes. As example, Hamel and Prahalad, the originators of the term core competence, explain that 3M’s core competence is expertise in substrates, coatings and adhesives. An organisational capability perspective might identify 3M’s capability is innovation, and the fact that this is innovation in substrates is a secondary concern.

'Repositioning', 'differentiating', 'integrating' and 'evolving' capabilities are all about influencing organisation, social and human capital (ie HCM - sorry about the additional jargon / terminology, Lucy) by aligning the people the organisation employs and the HR processes it uses around the organsation's capabilities (see this post).

Capabilities are important, because they provide the key to effective implementation of business strategies, and also the basis for identfying new strategies and opportunities (creating value). They're certainly important enough to deserve their own terminology.