A large part of defining the success of any organisation lies in its ability to attract, retain and develop top talent. For this reason, talent management has become a critical function for businesses across the globe. It’s no longer just a matter of filling vacancies but rather a strategic process that requires a deep understanding of the industry, workforce and emerging trends.
But there have been significant changes in the way businesses approach talent management over the years. From the early days of personnel management to the emergence of HR management as a strategic function, talent management has come a long way. And today, technology has truly revolutionised HR as a whole.
What does the future hold for talent management? In this article, we will delve into the key themes that have shaped the evolution of talent management, where we stand today, and where we’re headed.
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Looking Back at the Talent Management Process
Over the last 100 years, we have seen fascinating changes and adaptations to HR’s function, from emerging technology that changed how management worked to the core values of what HR management provides to companies and employees. Here is a short trip down memory lane.
Throughout the 20th century, HR management was formerly known as personnel management, and it was primarily focused on administrative tasks such as hiring, firing, and maintaining employee records. The role of HR was largely transactional, with an emphasis on compliance and ensuring that the organisation complied with labour laws and regulations.
HR departments were often seen as cost centres rather than strategic partners during this time. HR primarily handled administrative tasks such as recruiting, payroll, and benefits administration and was not typically involved in strategic decision-making or long-term planning.
The Rise of Talent Management as a Strategic Business Function
Over time, businesses became more competitive, and the importance of talent management grew. Organisations began to realise that their employees were their most valuable asset and that they needed to invest in them to remain competitive.
One of the key drivers of the rise of talent management was the changing nature of work. As companies began to rely more on knowledge workers and intellectual capital, they realised they needed a more strategic approach to managing their talent. This included developing a better understanding of what skills and competencies were required for success in different roles and creating programmes to develop those skills in employees.
Eventually, this led to the development of talent management strategies that focused on identifying high-potential employees, providing them with training and development opportunities, and creating career paths within the organisation. Career management and leadership development became a key focus of HR departments, significantly increasing employee performance and organisational effectiveness.
The Emergence of Talent Management Technology: ATS, LMS, HRIS
Between the 60s and the early 2000s, HR saw the development of Applicant Tracking Systems (ATS), Learning Management Systems (LMS), and Human Resource Information Systems (HRIS), revolutionising HR management. These management tools all brought different benefits to HR teams:
- ATS: Streamlined the recruitment process, making it easier for HR to manage the application process and for hiring managers to identify suitable candidates. Attracting new talent and building talent pools became a more efficient process.
- LMS: Helped companies provide employees with the necessary training and development opportunities to grow their skills and expertise, resulting in experienced employees and competitive advantage.
- HRIS: Made it easier for HR to manage employee data, track performance, and streamline administrative tasks, ultimately resulting in employee retention and losing top talent becoming less of a challenge.
Current Talent Management Practices
In recent years, there has been a significant shift in talent management practices towards more employee-centric approaches. Much of this shift has been driven by the recognition that employees are a company’s most valuable asset and that their needs and aspirations should be at the forefront of talent management strategies. However, there has also been a vast pool of research supporting this change:
- A survey by Deloitte found that six out of ten millennials need a sense of purpose to work for their chosen organisation.
- Research by Gallup discovered that company cultures that foster a social environment are 80% more productive than companies that don’t.
- Udemy’s Workplace Boredom Study revealed that 80% of employees believe internal talent development opportunities would help them feel more engaged on the job.
Because of these findings, many organisations are rethinking their talent needs and people management strategies. Here are some of the ways in which HR management is currently being shaped to turn the workplace into the most inclusive space for every team member’s needs.
1. Leveraging Technology
The emergence of new technologies such as artificial intelligence (AI) and machine learning (ML) has enabled HR professionals to understand better and engage with their employees. These technologies can analyse vast amounts of employee data, identify patterns and trends, and provide personalised learning and development opportunities that are tailored to individual needs and preferences. The economic downturn caused by the pandemic has accelerated the adoption of digital learning and training sessions in organisations.
HR is increasingly focused on creating a personalised approach to talent management that considers each employee’s unique needs and aspirations, providing tailored support and opportunities for developing talent. New employees are given the training required to meet new challenges and are offered flexible work arrangements that can positively impact their work-life balance. This helps talented people stay motivated and contribute to the organisation’s success.
3. DEI initiatives
There is a growing recognition of the importance of creating a diverse, equitable, and inclusive workplace. More companies are adopting policies and initiatives to address systemic inequalities and discrimination. Examples include unconscious bias training, diversity and inclusion committees, no layoff policies, and diversity recruiting programmes. These initiatives help to create a more welcoming and supportive environment where all employees, including the best talent, feel valued and respected. People teams and the people profession are also being redefined to reflect these changes, and the hiring process is being refined to attract top talent at the same rate.
The Future of Talent Management Strategy
The future of managing talent is rapidly evolving, full of excitement and potential. Some of these changes involve further technological advancements, changing workforce demographics, and the ever-present need for businesses to remain competitive and retain employees. A Global Employee Survey by EY also shows that 9 out of 10 employees want flexibility where and when they work, and it’s why more companies than ever will be trialling 4-day work-weeks in the foreseeable future.
Considering all of this, here are some of the future trends we will likely see emerge in HR management in the years to come.
1. Holistic Approach to HR Management
One key theme emerging in talent management is the need for a more holistic and integrated talent management model. This approach requires a deep understanding of the interconnectivity between various HR functions, such as recruitment, onboarding, learning and development, performance management, and succession planning. In the future, we can expect HR to focus on building more integrated talent management systems that break down silos and provide a seamless employee experience.
2. HR Leaders Shaping The Future
HR leaders will play a crucial role in shaping the future of talent management, staying up-to-date on the latest trends and technologies, being open to new ideas and strategies, and adopting these new approaches in the workplace. The ability to build strong partnerships with business leaders, employees, and external stakeholders will also be critical to driving the success of future talent management programmes.
3. New, Emerging Technologies and Their Impact
Besides AI, new emerging technologies are poised to disrupt the talent management landscape, including blockchain, virtual reality/augmented reality, and automation. In action, this is what these technologies could do for HR talent management:
- Blockchain technology: allows HR to create a more transparent and secure hiring process by creating a tamper-proof record of all candidate information and actions taken during the hiring process, making it more difficult for anyone to manipulate or falsify data.
- Virtual reality (VR) and augmented reality (AR): enhance employee training and development experience by immersing employees in realistic, interactive simulations that allow them to learn and practice new skills in a safe, controlled environment.
- Automation: streamline repetitive tasks such as data entry, scheduling interviews, and sending reminders, and free up HR team schedules to focus on more strategic initiatives.