The Battle For Talent

One of the challenges facing businesses of all sizes today is finding, developing and keeping the right talent. While unemployment is at record highs all over the world, and companies don't look to be adding great numbers of head count in the near future, one thing remains certain: good people are in high demand like never before.


The challenge has always been how to find the right level of talent for your business. As I speak with business owners and work with clients all over the US and Europe, I hear one consistent message: I need the right people to help us get to our objectives. But where are the great people? More importantly, how do I get them?


There is no simple answer to this challenge. The reality is that good people are hard to find. And most companies are not doing a great job of developing talent and keeping them. I consider my personal network to be high quality, yet the majority are not content with their current companies. And its not just about more money. In fact most of the folks I speak with and who I consider very talented based on my personal experience with them, are not looking for positions with more money. They are looking for a place they can excel in, and its not the companies they are working at today. Companies that to the outside observer are considered 'great employers'.


There are several key problems I can see with the labor markets today, especially in the US. The first is that governments are not paying enough attention to differentiating between talent and average workers. The US arguably has the best University system in the world, yet studies show that a high percentage of top quartile talent graduating from these schools are foreign nationals. And these foreign nationals have little choice but to leave the US upon graduation because they cannot secure working visas, greencards or US residency. In this country we are losing the top performing graduates because we have no viable government policy to support keeping them.


I recently had dinner with a healthcare professional who said the only way they can keep Doctors and specialists in the country is by putting them to work in the VA system (Veterans Affairs) for 5 years in return for greencards. This system has managed to keep a large number of Indian, Iranian and Chinese medical graduates in the country. Its a good program, but not enough to ensure we continue to keep large numbers of medical talent that our Universities and medical centers have trained. Outside of the medical field we do not have similar programs that ensure foreign scientists, engineers and MBAs can stay on once their education is complete. Some groups have lauded the concept of automatically offering greencards or work visas upon successful completion of higher education. This makes a lot of sense in my view and the government should seriously look into it.


Further down the spectrum is the challenge companies face when looking for talent. Neither external recruitment firms or internal HR departments have mastered a methodology or process to recruit the best possible talent for a specific role. The majority of HR organizations focus on 3 things: the candidate's degree or diploma, the candidate's prior experience relevant to the position for hire, and the candidate's career phase - as in where are they on their career path today? While these three considerations have some level of relevance in selecting talent, they are not in any way key indicators of whether the individual in question will be a high performing contributor, a leader or an effective manager. In fact, most of the data I have seen and used in my experience indicates little to no correlation between these three criteria and actual performance of an individual. External recruiters have an even more spotty track record of successfully finding and placing high performing talent, mostly due to the drastic changes in how these organizations are being run today versus 15 years ago. Most recruiters have to make quota in order to survive and earn their pay checks, taking focus away from understanding the clients' needs and matching that to the right candidates. In short they have become salesmen focused on their hitting their numbers.


Companies and specifically hiring managers are going to have to do a much better job of looking for, developing and keeping talent as we enter the second decade of this century. Using the basic three criteria HR departments have focused on in the past will not be enough. Employers the world over are painfully seeing serious gaps between elite educational credentials and actual individual competence. This does not mean you stop focusing on graduates from the elite schools like the Ivy League, Stanford, Insead and others, but rather you need to open the field up to look at the candidates who have proven track records of achievement and success but may not fall into the bucket of tier one school, prior experience in your specific field or at the exact point in their career that you would prefer. You are going to have to do a much better job of looking at the broader labor market and efficiently vetting the 'A' players from the rest of the field.


My own experience shows this can be done. After leaving the start-up company that became an established public company after 9 years, I joined a privately owned medical technology company that specialized in a narrow field. The first interesting point is that I personally had no prior experience in the medical technology or healthcare field. I was hired to come in and execute a turnaround of the company's entire operations, specifically sales and marketing, in order to position the business for further growth. After a few months of getting my arms around the team and operation, I concluded that the majority of the existing sales team lacked the talent required to help us succeed. Furthermore, the profile the company had been recruiting to was too narrow and in my view lacked key competencies that are crucial to a sales person's success.


The first step I took was to personally take the lead in hiring a new team - as COO that was perhaps not part of my job description, but I felt it was one of the most important tasks I had to own. My former employer had developed a comprehensive recruitment process that worked extremely well, but was designed for a bigger organization with vast resources I didn't have in my new company. I also did not have the time to manage a drawn out process that while successful in the past would consume too much of our resources. Time was of the essences, I was shedding sales people but my targets for the year were unchanged. We needed talent and we needed it fast. I set up a three-step recruitment process that culminated with a two-week on-boarding process that was foreign to the company and especially the CEO (who felt once hired we had to put the sales people to work, not 'waste' time training them).


Leveraging new technologies like LinkedIn and regional job blogs, we had over 100 applicants in less than a week. About 70 went through the first step of short 5 minute phone interviews where we filtered further. Of the 70 phone interviews we invited 9 to face to face interviews. We hired 4 of them at the end of the process, all of which lasted 4 weeks. What was interesting was the background of the 4 sales people we hired - one was a career salesman from the telecommunications industry, but the other three had no sales background. Two were from an investment firm and one had her own business coaching young athletes. None of the candidates were Ivy League or top tier schools, all were undergraduates. But the qualities they had as individual professionals were so impressive that we didn't hesitate to hire them. And within 6 weeks they made an impact on the rest of the team and the business. It can be done.


Pundits and policy-makers jabber about the need to educate people to compete in knowledge-intensive industries. But knowledge does not represent even half the intensity of this industrial challenge. What really matters are skills. The grievously undervalued human capital issue here is not quality education in school but quality of skills in markets. And establishing correlations, let alone causality, between them is hard. As Michael Schrage, a research fellow at MIT Sloan School’s Center for Digital Business, states "A computer science PhD doesn't make one a good programmer. There is a world of difference between getting an "A" in robotics class and winning a "bot" competition." Great knowledge is not the same as great skill. Worse yet, decent knowledge doesn't guarantee even decent skills. 


And finally there is the role of the individual talent. He or she has digressed over the past decade from what employers seek. Generation Y is not quite in step with the employers of today, no matter how successful Google and Facebook have been at creating and growing their companies. Its all good and well that you want to follow your passion, save the earth, or just do good, but you better be damn good at it. The reality is career selection will be more important than ever, and your ability to demonstrate skills and excellence will be even more important. Financial Services and Software sales are no longer the career-path of choice, Healthcare, Education, Mathematics and (New) Technology will play that role in the next decade.


Regardless of generation, the average worker today does not view or portray themselves as 'experts' in anything. And this is the problem we face with the labor market today sitting on the employer side. Each of us has the opportunity to be the best at what we do, yet society and education over the past 15 years have focused on 'normalizing' everyone in some politically correct effort to promote 'fairness' and 'equality'. It used to be that only first place got a trophy, but today's school programs award trophies to anyone who participates. Fast forward 10 years to your professional career and you learn quickly that just be cause you showed up to work everyday doesn't mean you are going to get that promotion and raise you so badly want. You need to demonstrate skills, results and excellence to standout. Its the way of the world and most of the workforce in the West still doesn't get it. You need to be the absolute best at what you do.


One parting thought for all of us to ponder: as skittish as employers are about hiring in this economy, one thing is for certain - the selection criteria for hiring a single worker is going to be extremely high, much higher than we have seen in the last 30 years. Its not just because there is so much more competition from the unemployed, but rather the employers are becoming laser focused on hiring the absolute best person for that one open position that can make all the difference to their business over the next 12 months. Are you going to be that hire? Are you the best?