Should You Tell Talents They Are Talents?

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There are certain questions that keep coming back when I ask HR or line managers what they would like research to look into when it comes to talent management. One stands out as the most common one of all: Should you tell your employees that they have been identified as talents, and – indirectly – that others have not?

There certainly are relevant concerns that can make you hesitate about putting that crown on some heads and not others. For one, managers often worry that if you tell a high-potential person that he or she is a talent, the person will start resting on his or her laurels and stop trying – a phenomenon often referred to as the crown prince syndrome (Dries & Pepermans, 2008; Dries, 2013). There is also the fear that the talent nomination will create unduly pressure and stress.

Even more common, however, is the fear of how the non-selected employees will react (De Long & Vijayaraghavan, 2003). HR managers often worry that this group will experience feelings of injustice and envy, resulting perhaps in turnover or lower engagement. There is also a cultural aspect to this worry: In the Nordic countries, traditionally associated with values of egalitarianism, singling out a small minority as “better” than the rest is more controversial than in e.g. the Anglo-saxon world.

So, how do companies handle this matter? As it turns out, there is a large discrepancy between what you might call formal and informal transparency. Church et al. (2015), who surveyed 80 companies with well-established talent management practices, found that only 34 percent formally communicate talent decisions. However, out of the 66 percent that did not formally tell employees, 18 percent reported that managers tell employees informally, and 33 percent said employees find out on their own. Thus, only 15 percent of companies seem to have employees that do not know which ones are considered talents. This is well in line with a study by Campbell and Smith (2010), where 91 percent of surveyed employees reported that they knew their own talent status, but only 69 percent of those had been formally told. The rest had figured it out on their own, or someone had told them off the record.

Studies have also shown that there might be positive effects of being told that you are a talent. Björkman et al. (2013), for instance, found that employees who knew they were considered talents were the most committed to the organization. Furthermore, Campbell and Smith (2010) found that this effect was stronger for those that had been formally informed of their talent status. Less is known about the effects of a formal notice on those not identified as talents. In one of the few studies conducted, Björkman et al. (2013) found no significant differences between those who knew they were not nominated as talents, and those that had no knowledge of their standing. What has turned out to cause a lot of negative reactions, on the other hand, is when HR decision processes are perceived as obscure. A host of studies have shown that employees’ perceived justice is severely compromised when they do not understand how HR decisions have been made (cf. e.g. Sumelius et al., 2014, who looked at performance appraisals).

Once clear conclusion can be drawn from this: Whether you formally announce talent decisions or not, the vast majority of employees will still figure them out. Further, the rather few studies conducted indicate that the effects of a formal announcement might be more positive than expected by many HR professionals – but more research is needed. One thing that seems clear, though, is that ambiguity and secrecy about talent decisions is seldom the way to avoid potential adverse impact. The risk of negative reactions is much higher if the process appears as cloudy and non-transparent.

What this reasoning also boils down to is this: The core issue is not the informing part, it’s whether you should select some employees as talents in the first place. What is the strategic value of this activity? As long as you can answer that question clearly, it will be easier to dare to be transparent.

 

Photo: https://www.flickr.com/photos/98004108@N03/

Talent Trends for 2017, no. 3: The Networked Talent

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Welcome back to the third and final part of our list of trends and developments within talent management for 2017. If age and teams are topics that are entering organizations like waves, almost forcing talent managers to take them into account, this third trend could be viewed more as a large untapped possibility. The third trend, drums please, is networks.

It is almost a truism that social networks matter immensely in organizational life. Who knows who and who talks to who affects  information sharing, the distribution of power, and people’s careers. Your centrality in organizational networks should arguably also matter for your talent status: A person who is able to establish and maintain relationships with key people is much more likely to succeed than one who tends to remain peripheral. Still, network analysis has not reached talent management to any larger extent. Big data and the internet of things might now finally become the enablers. Take the very interesting study by Woolley et al. (2010), where employees were equipped with tracking badges to see how they interacted. The study elegantly revealed which colleagues people went to for advice (and for gossip) and how information spread in the organization. This type of knowledge is invaluable for organizations, since it identifies key actors.

At the annual academic workshop on talent management, organized in Copenhagen this past september, network analysis (the outcome of which might look like the chart in the image above) repeatedly came up as a potentially extremely valuable tool for talent management. For instance, HR could use it to identify those employees that are crucial nodes when it comes to e.g. linking different departments or groups of experts together. It could also be used for developmental purposes: A high-potential person who lacks the right connections will likely need to be coached, or his or her career will stall.

So there we have them, three broad trends on the rise in talent management in 2017: Age, teams, and networks. As you can see, the common denominator is the need for HR and senior management to start challenging some of the taken-for-granted assumptions about talent. The often implicit assumption that talent management is all about attracting and retaining young, individual stars and accelerate their career trajectory is ripe for questioning, and chances are this will be the year for it.

 

Photo: https://www.flickr.com/photos/marc_smith/

Talent Trends for 2017, no. 2: Talented Teams

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Continuing the list of trends within talent management for 2017 – and today, we have reached a topic that up until now has largely been championed by the startup and tech world. Over the past year, however, there have been numerous indications that this issue is gaining ever more attention in other sectors’ talent management, too. I’m talking about teams.

The word talent is not only associated with youth, as we talked about last time, but also with individuality. Most of organizations’ talent initiatives focus on identifying persons to be included in e.g. high-potential pools and programs. Arguably, this does not rightly reflect the conditions of modern work life in many industries. Most notably, knowledge-intensive work with high demands for innovation craves well-functioning teams. This is something very different from a mere collection of talented individuals. Remember the Groysberg studies, about the star analysts whose performance dropped when they switched jobs? Well, this did not happen for those analysts that took key parts of their teams with them (Groysberg, Eling Lee, & Nanda, 2008;Groysberg, Nanda, & Nohria, 2004). In other words, teams enable the deployment of individual capacities. Furthermore, they make members collectively transcend their individual capacities to reach higher. Much of the real top performing today is done by teams, not individuals.

Organizations, then, have everything to gain from breeding and maintaining high-performing teams. In other words, it is about time we started talking about talented teams. My prediction is that many organizations, not least professional service firms, will spend considerable time in 2017 rethinking aspects like incentive systems, assessments of potential, and development opportunities in order to better account for the team level.

 

Photo: https://www.flickr.com/photos/brickset/

Talent Trends for 2017, no. 1: Age

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A new year is born, and the blog is back to cover new developments and research findings within I/O psychology and HRM. The biggest focus will of course be awarded to my own  research topic, namely talent management. Although it has been almost two decades since the term “the war for talent” was coined, this is still a field where a lot keeps on happening from one year to another. So, what better way to start off 2017 than by looking into where talent management might be headed? I have taken to scientific journals, conferences, industrial developments, and my own conversations with managers and HR professionals over the past year to round up three broad talent themes that will most likely become increasingly relevant in the coming year. The first one out is a topic that can scarcely be avoided due to both demographic and legal reasons: Age. 

Traditionally, talent management has mostly been aimed at the junior segment of the workforce. Chances are that we will see this shifting in 2017. It cannot be lost on anyone that large parts of the Western world, and not least Europe, have an aging population. The seniors are healthier than ever, and many will want and/or need to work longer. Many of the late baby boomers and early generations X:ers will likely work well into their 70s. And on top of this we have the increasing legal focus on age as grounds for discrimination.

In other words, companies are facing a situation where age will need to be factored into the talent equation. For instance, is it always reasonable to put an upper age limit on your talent pool? This is not just a fairness issue – there are also important strategic reasons for wanting to include the older segments into talent management initiatives. If talent really is a scarce resource, few organizations can afford to say no to large pools of potential talent on such irrelevant grounds as age.

Still, there are indications that they do. Swailes and Blackburn (2016), for instance, showed that older employees had a smaller chance than younger of being included in talent pools. This is in line with research showing that age stereotypes are alive and well in organizations: For instance, we tend to consider older employees as less productive (Posthuma & Campion, 2009),  less willing to learn, and more change resistant (Ng & Feldman, 2012).  Transcending these stereotypes and the “think talent, think young” mindset is a major challenge that will likely increase its presence in 2017.

 

Photo: https://www.flickr.com/photos/20980483@N04/

Five Christmas Gifts for Talent Management

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The festive season is upon us, and the first semester of this blog is drawing to an end.Quite a journey if you ask me!As Christmas draws near, I thought we would finish off the year with a little wish list for talent management, based on research and companies’ realities. See it as five really nice gifts to put under the tree for your organization’s talent management.

  1. A well-reasoned definition of talent. Very often, ”talent” and ”talents” become terms that are just thrown around without much consideration. When you say that your organization needs talent, what exactly are you referring to? A clear common theme for organizations with a mature and successful talent management is that they have spent considerable time answering this question. This is especially important considering that ”talent” is such an enigmatic term. Does talent primarily imply innate abilities, or a certain mindset and attitude? Is ”talent” always versatile, or can you be a talent in just one specific function or role? Are everyone talents, or should the term apply to a small organizational elite? Research can only get you so far in answering these questions – to some extent, it always comes down to the organization’s values, culture, and strategy.
  2. An honest consideration of whether and why you need a talent program. It is safe to say that the trend of talent programs has become somewhat of a bandwagon in the last five-or-so years. And for some companies, they certainly fulfill important purposes, such as increasing attraction of candidates and speeding up employees’ development. However, there are indications from research that talent programs may also have adverse consequences if not thought through beforehand. Not least, questions and frustration may arise when it is not clear to other employees why some have been selected for this precious initiative. In other words; talent programs need to be handled with care. HR teams and management teams should ask themselves prudently: Do we really need this program? For what exact purposes? How do we avoid negative reactions? If these questions cannot be answered properly, it is usually better to put the idea on hold.
  3. More focus on how talent decisions are communicated. There are few hard truths within research on HRM and Organizational Behavior, but one of them could be summed up as follows: It is not the thing in itself, it is how that thing is communicated. We know this from literature on performance ratings, developmental talks, promotion decisions, and more. How managers and HR professionals formulate these things has an enormous impact on how employees react, and what the longer-term effects are. Talent decisions are no exception in this regard. Be sure to spend enough time discussing how managers should notify selected talents of their appointment, and how these decisions should be communicated to other employees. Consider, for instance, the difference between describing the program as a reward for being outstanding, versus a forward-looking encouragement to keep on challenging yourself.
  4. A switch from identifying to developing. It is clear that many organizations today have very elaborate processes for identifying talents: Calibrations, assessment centers, rating matrices, etc. Quite often, however, you end up with a very well-founded talent pool – but fewer ideas on how to develop them. Opportunities for vertical promotions are often scarce, and formal trainings are expensive. Still, development must be seen as a real core process of talent management – otherwise, what is the point of identifying them? One avenue is to start looking at the possibilities for horizontal movements, e.g. rotations. Most importantly, however, is usually to ramp up on on-the-job training.
  5. A clear management of expectations. If it is one side effect of talent management that must be attended to, it is the raised expectations of those appointed as talents. Tell someone ”we consider you one of our talents” – and that second, you have re-negotiated the psychological contract with that employee. He or she will start expecting more development and career opportunities, and often within a rather limited time. If nothing then happens, chances are you will lose this person instead. Managing expectations from day one is thus key. Some organizations address this by working intensely with gap analysis: Clearly identifying and communicating where the talent’s development areas lie, and what will need to happen before the person can take the next step.

There we are – five nice Christmas gifts for basically all organizations’ talent management. With this list, I would like to wish you all a very Merry Christmas and a Happy New Year! I am very much looking forward to seeing you again in 2017, continuing our journey into the fascinating landscape of the psychology of work.

 

Photo: https://www.flickr.com/photos/mbtrama/

Why a Talent May Not Always Be a Talent: The Importance of Context

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“Talents, they just come in and shine from day one.” “I can spot a talent the minute they walk through the door.” As a researcher, I hear these kinds of statements quite often when I’m out talking to HR specialists and line managers about talent management. The idea of talent as a generic, stable, and portable characteristic is rather widely spread, not least in companies of North American origin. This is also the view that underpins the whole notion of “the war for talent”: There is a scarcity of talented individuals, and all organizations are fighting for the same people. A talent, according to this view, is a talent no matter where you place them. This has lead companies to focus their talent management efforts on attracting “the A players”, often not worrying too much about how to make the best use of them within the company. Just get the talents in here, and they will excel no matter where we put them.

There is some truth to this claim, of course. We know from decades of research that some stable inner traits – most notably, general mental ability and the personality trait conscientiousness – tend to predict work performance in a very broad range of roles and lines of business. In other words, there are some foundational parts of talent that you could consider portable. However, there are other chapters to the story as well.  Over the last decade, there have been increasing indications that talent is also very much a matter of context.

This line of research has been championed by Boris Groysberg at Harvard Business School. For over a decade, he and his colleagues followed a total of 1,000 financial analysts at Wall Street. One of the things they looked at was what happened when star analysts switched firms. What they found was that after changing employer (still doing the exact same kind of work), top analysts’ performance decreased significantly in about half of the cases. The drop was by an average of 20 percent, and not just in the short run. In fact, it took around five years to get back to where they were before switching jobs (Groysberg, Eling Lee, & Nanda, 2008; Groysberg, Nanda, & Nohria, 2004).

Why would this happen? Groysberg argues that portable, individual skills and abilities really only constitute one part of what you might call talent. The rest is firm capabilities, such as leadership, training, systems, teams, and reputation. Since the star performers cannot bring those capabilities with them when they move, performance is likely to drop.

However, there are also some very interesting qualifications to this conclusion. For one, moving to an investment bank with similar capabilities and culture as the old one tended to decrease the performance drop. This was supported by another study, where Groysberg and colleagues showed that similarity in structures and culture between the old and the new company had a very significant effect on the performance of a new CEO, regardless of the person’s performance in the previous role (Groysberg, McLean, & Nohria, 2006). Furthermore, the study of star analysts showed that when the stars took members of their original team with them to the new firm, the drop in performance was eased significantly. In other words, top performance is not only a matter of individuals, but also group structures.

The important role of context is not limited to the finance industry or to managerial roles. In a study that received a lot of attention, Huckman and Pisano (2006) looked at the performance of star surgeons performing surgical operations in several different hospitals. Using risk-adjusted mortality as the outcome, the researchers saw that the same surgeon’s performance differed significantly depending on the hospital he/she was operating in. Notably, the surgeons performed better in hospitals where they had performed many surgeries. Furthermore, there was no general improvement in performance the more procedures the surgeon completed in total: Performance improvement in one hospital was only related to doing a larger number of surgeries within that specific hospital. In other words, performance was closely tied to context. The authors concluded that the surgeon’s familiarity with the specific setting – key staff, team structures, and routines – was vastly important for their performance.

To conclude, these studies convincingly show that the “once a talent, always a talent” philosophy is only partly true. The individual surely brings his or her knowledge, skills, and abilities, but the context enables, enhances, hinders, or blocks. Talent development is enabled by teams, cultural fit, and deep understanding of the specific setting. This is a crucial fact to keep in mind for talent management officials in any industry.

 

Photo: https://www.flickr.com/photos/sagesolar/