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WITI CAREERS
Why Talent Matters
In the emerging knowledge economy, value is increasingly driven by talent and other non-tangible capital. The competitive strength of companies, social organizations and countries has now shifted from ownership of physical assets or resources, to the intellectual attributes of their knowledge workers. In fact, recent data indicates that for Standard and Poor 500 companies, only $1 of every $6 of "market to book" value represents financial or physical assets. The balance, of course, are intangible assets, among which your talent and the market's perception of your talent are key. This represents a sea change in value creation that moves talent, not physical resources, to the fore. As a result, "people skills" are critical to the success of every leader in the organization. Knowing how to attract and hire the best and brightest people in your market, unleash their passion and harness their creativity are core management skills today. Are you and your organization at the leading edge of this challenge? Business is evolving rapidly from the top-down industrial management structure to a flatter, more networked, collaborative model. The Human Resources function, built on an administrative foundation for the manufacturing economy, is transforming itself into a strategic discipline that regards labor as human capital to be invested and grown, not used and discarded. But human capital management is not the province of HR. It is a continuum, that starts with strategic planning, moves through sourcing, assessment, hiring, individual development, team building, advancement and beyond. In most organizations the continuum is an assembly line, with search firms, contingency recruiters, corporate recuiters, HR generalists and trainers, line managers and executives all standing in turn to do what they do best. This remains an effective HR model for interchangeable labor. When organizations need a mass of people with relatively similar skills, executives can plan, recruiters can recruit, HR can hire, and managers can deploy the labor resources required to build the product. But what happens when innovation, collaboration and execution become the product itself? In today's digital economy, global boundaries and traditional barriers to entry are collapsing. To grow, companies must constantly innovate, enter new markets, lower costs and answer competitive threats instantly from all sides. To compete effectively, companies must be faster, more flexible, and willing to take greater risks than ever before. To win on these terms, companies need to hire, develop and deploy the best players, and build the best teams. CEOs, shareholders and executive leaders all agree, as surveys like this report: "How companies manage their human capital has become an important investor and board-level issue. Forty-nine percent report that investors are beginning to ask about human capital issues. Today, 23 percent say that their boards are highly involved in human capital issues; in two years, 36 percent expect such involvement. Interviews suggest that recent board interest is a growing recognition of human capital's importance to the bottom line." (CFO Research Services in collaboration with Mercer Human Resource Consulting)Workforce planning, employment branding, building a strong and diverse corporate culture, alignment of rewards, succession planning - all of these issues, and many more are becoming strategically important as organizations compete for knowledge workers and ideas. How can these be integrated into the fabric of executive leadership? At The Human Capital Institute, we believe the first step is to begin communicating at a strategic level beyond the silos of search, human resources and line management. Executives must be educated across the talent continuum, so that they have a clear view of the entire talent lifecycle. They must become conversant with the most effective ways to attract great people and with the best methods for engaging and motivating them. To meet these challenges, leadership roles, expectations and competencies are being redefined in many organizations. HR is increasingly being outsourced and taken offshore, even while human capital management is being defined as a core competency. The distinction is that a stronger focus on talent acquisition, development and performance are clearly linked to business strategy and proven to improve business performance and greater value. As the 2004 Watson Wyatt Index clearly shows: "The linkage between superior human capital management and superior shareholder returns has been proven. If you hire the right people, create an environment that supports creative thinking and increased productivity, leveraged by technology, you'll reap the rewards." To sign up for your FREE HCI membership today, visit the WITI Members' Area. Questions about HCI? Visit www.humancapitalinstitute.org/hci/witi_login.guid.
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Last month, WITI kicked off an alliance that provides its members with a free executive membership in the Human Capital Institute. Normally $199 per year, this partnership offers WITI members unlimited access to HCI thought leadership, cutting-edge research and education. HCI is an exciting clearinghouse for innovative new strategies that help organizations hire the best people, develop their potential and nurture innovation. Why is this important? Because leaders realize that success today increasingly relies on individual creative talent and team execution.