A large global client recently shared with me that over 3,000 of their employees will retire in the first quarter of this year alone. This number is significant enough that the company may be able to avoid a pending layoff. However, the rapid loss of the collective experience, knowledge, and wisdom represented by these retirees is creating a drastic talent drain that cannot quickly or easily be replaced through traditional recruiting practices. Without the right blend of highly experienced, mid-career, entry-level, and transactional resources, the company is justifiably concerned that achievement of their business objectives is at serious risk. Not only does finding immediately effective, senior-level talent have a long lead time, but simply backfilling positions vacated by retirees with full time, permanent employees also reduces the company’s agility and flexibility to quickly respond to changes and opportunities in their market. The company is actively searching for new approaches to human capital resource planning and recruitment that positions them for both short and long term success.
This client is not alone. I hear these stories all the time. Companies are struggling with the loss of valuable knowledge due to retirement, M&A activity, or massive transformation initiatives. Recently, I wrote about the need to think differently about talent planning and sourcing. The challenge is that the demographic make-up of the workforce and the changing needs of businesses are happening so fast that HR and Procurement cannot keep up. Based on our work with hundreds of Fortune 500, start-up, and private equity Consumer Goods and Life Science companies, I offer six “talent hacks” to accelerate your workforce optimization. Here are the first three.
Before I go any further, I want to make sure we are all on the same page in terms of what I mean by a “hack.” Originally a less-than-complimentary term for cab drivers and news reporters, its meaning expanded with the advent of computers to include (not always effective or legal) workarounds in programming. The workaround aspect has continued to evolve in a much more positive way, and today reference to a “hack” now includes “an appropriate application of ingenuity that finds a short cut or more efficient way to achieve a goal and increase productivity.” That is the definition I’m using here. A “talent hack” is an innovative, cost-effective way to acquire and manage talent. Here are the first three of six talent hacks that have come out of our work with clients both large and small. Next week, I’ll share the remaining three.
- Plan ahead. Think about your 1, 3, and 5-year business objectives and the workforce you will need to deliver them. Compare that to the demographic, skill, experience, tenure, and leadership mix of your current team. How many of your current employees will retire over that horizon? How many will be high-potential early-career Millennials who could benefit from mentoring by a Boomer? Do you anticipate acquisitions, divestitures, innovations, or other time-bound events that would best be served by bolting on and off specific expertise only as needed? Build out a human capital demand plan for both anticipated and unanticipated resource requirements. Use this demand plan to identify the pool of knowledgeable, experienced talent you will need, both permanent and temporary, well in advance of the requirement.
- Divide and conquer. We have seen increasing numbers of companies expand their Managed Service Provider (MSP) program to include talent procurement ranging from staff augmentation to strategic consulting. Often housed within the Procurement organization, the focus and intent is driving out cost and improving processes. In my experience, an MSP is very efficient and cost-effective in filling requests for entry level, non-specialized, and transactional resources, primarily because this pool of potential talent is relatively large. However, an MSP approach is not effective when the need is for talent with scientific or technical skills and/or the wisdom that comes with greater experience in a specific discipline coupled with broader business and leadership acumen. The MSP is inefficient in these situations for two reasons. First, it is difficult for the MSP to vet candidates because they don’t typically have specific knowledge, training, or understanding of the requirements, nor do they have a network of highly skilled, experienced talent to draw from. Both are necessary to appropriately fill these types of positions. Consequently, the recruitment process becomes long and drawn out. Candidates are often incorrectly identified as “fits” or “misfits” for the position. For example, one our clients spent almost three months reviewing over 34 resumes and conducting interviews with candidates identified by their MSP and still did not find the right person to hire. Second, highly skilled and experienced resources do not fit into the pricing models being driven by an MSP. Clients have shared that their MSP sets a very low bill rate, even for jobs that require over 20 years of experience. These bill rates are often below the market rate for professionals at this level, making it even more difficult to find and engage the right talent. Bottom line: classify your flexible talent requirements based on the level of experience, expertise, and leadership you need. Leverage your MSP for entry level, non-specialized and transactional needs. Move those requiring greater experience and/or specialized skills out of the MSP and add hacks #3 through #6 to your repertoire.
- Build a Ready Bench. A Ready Bench is a group of pre-vetted experts in specific disciplines that a company anticipates needing over the horizon of their human capital demand plan. They are available for specific time-bound events, seasonal fluctuations, extended part-time engagements, and/or special projects. These bench players are pre-screened by the hiring company to ensure they meet their requirements. They can even be trained on company-specific processes and systems to help them hit the ground running when called upon. Bill rates are pre-negotiated. The bench is big enough to ensure resources are always available. This drastically reduces the cycle time to get talent onboard…from months down to days…and represents a significant cost savings while greatly increasing time to value.
In summary, think strategically and proactively about your short and long term human capital needs. Objectively assess, anticipate, and plan for churn at both ends of the spectrum…Millennials who expect to move-on every 2-3 years and Boomers who are reaching retirement age and have more options than ever for remaining active and engaged as independent contractors after receiving their gold watch. Approach finding highly experienced talent to tackle complex business challenges differently than finding entry level, non-specialized resources to meet surges in workforce demand. Get ahead of the need by building your own bench of experienced talent that can be called upon as needed.
Next week I’ll share creative ways to build your Ready Bench and ensure that both the players and the company receive immediate and on-going value. In the meantime, if you are ready to start tackling your own talent challenges, contact me. Let’s talk about we can apply these talent hacks (and more) to meet the needs of your business.
About Mike Lewis: Mike is Chief Sales & Marketing Officer for YourEncore. He is passionate about connecting Life Science and Consumer Goods Clients with YourEncore Experts, bringing them the rich experience and technical know-how they need to address their business challenges via flexible resourcing and consulting engagements. He is an innovative sales and marketing leader who has successfully introduced new selling and marketing models that have transformed companies in the process. He is a thought leader in social selling and account based marketing and has leveraged both to grow company revenues and reputation.