In her session on workforce planning at Starbucks, Lacey All talked about the need to ensure resources are deployed against pivotal roles and key talent segments in order to remain flexible in responding to current and future business innovation demands,
Well, I’d understand it if you feel I’ve done the these of workforce differentiation to death, but I think it’s one of the most important issues in strategic people management today. As Row Henson from Oracle mentioned in her session on Measuring Performance (quoting Dave Ulrich) the value of top performers can be 12 times the performance of average employees. So I hope you’ll let me dwell on it a bit longer.
I recently wrote my 5th post on Dick Beatty’s Differentiated Workforce (this is my 6th).
In general, Dick’s presentation made me feel a lot more positive about his approach.
- Rather than linking strategic / A roles to critical business processes, he focused much more on ‘capabilities’ as the basis for identifying talent groups. I thought this was much more positive because it means he is putting the overall shape of the organisation ahead of talent by itself. This is my approach as well – identifying and investing disproportionally in talent is often going to be an important aspect of HCM strategy, but not, in my view, as important as differentiating the organisation as a whole. [Note however, that although Dick uses the word ‘capabilities’ he says himself that he really means ‘core competencies’. I believe that 'true ‘organisational capabilities’ provide a much sounder base for HCM strategy so I tend to start with these.]
- Dick also showed how capabilities and therefore strategic roles differ across organisations within a sector (Nordstrom and CostCo). This was an omission in Beatty’s book (at least I couldn’t see it) and one of my major concerns, as I couldn’t see how the approach was differentiating if all organisations within a sector had the same strategic roles!
However, I still have concerns, including:
- I don’t believe differentiation is necessarily the right approach all of the time (eg organisations with a capability of inclusivity).
- I don’t believe that differentiation always needs to focus on A roles and A people. Pivotal talent are another quite possible option for example. [Row Henson again (lifting from John Boudreau this time): "Who's the most pivotal person at a Walt Disney resort?" she asked. "I'd argue it's the man or woman who sweeps the streets at the end of the day. These won't be top performers in the classical sense of the word, but they are pivotal because, if the resort is dirty, customers won't want to return."]
- I don’t agree that organisations which do differentiate as Dick Beatty suggests should deliberately search out C candidates for C roles. I’m with Jack Welch – you want to raise the calibre of the whole organisation – including A, B and C roles / people.
- When you do have people working in C roles (that you’ve not yet made leave the organisation), I’d suggest you still need to focus on raising their capabilities and performance. I don’t agree that you should deny them feedback or as Row Henson suggested, have ‘a list of people not to develop’. I don’t believe that doing this would allow you to invest any more time or resources in supporting people in A roles / A people. It’s just going to mean putting even more time into looking after, correcting the mistakes etc of the C players who don’t know how they can improve.
So, organisations that want to differentiate themselves (and doing so is pretty fundamental to gaining competitive advantage through human capital), have to ask themselves a number of questions (* although of course they can also ask for my help! *), including:
- How are they going to differentiate themselves, ie what organisational capabilities are they going to develop?
- Which talent groups support this differentiation, and how can they best define these?
- How can they best support each of of these groups differently?
- See the following slide from Peter Cheese, ex-Accenture, from his presentation on talent management at the CIPD conference:
In dealing with the second bullet point above, it’s useful to know that talent can be defined in a number of different ways:
- Key people
- Key roles
- Key people in key roles (Beatty)
- Pivotal talent (Boudreau)
- Scarce talent (from workforce planning)
- And based upon a range of other factors, including individual talents’ demographics and perspectives (a true HCM strategy will differentiate according to their talents’ needs, rather than their own) – see another of Peter Cheese’s slides:
(Note that for Cheese, using Beatty’s approach isn’t pushing the envelope or leading edge, but is merely typical of what happens today (if done in a rather more sophisticated way).
What do you make of all that?
Are you differentiating your organisation through your workforce?
And are you differentiating it in the most optimal way?
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