Many innovations are aimed at more effectively attracting and recruiting talent:
• Applying a “market segmentation” strategy. Just as customer segmentation is the basis for modern marketing, employee segmentation is becoming the basis for modern HR. To be sure, basic standards of HR practice need to be in place and must apply universally, and every employee needs to be treated with dignity and respect. But just as marketing responds to different customer segments with customized offers, so must HR create customized career alternatives for a diverse workforce.
This means differentiation at the employee level. “When somebody tells me he wants to move to France and work from there for a year, I’ve got to ask, ‘How can we make that happen?’” says Shannon McFayden, Wachovia’s senior executive vice president for human resources and corporate relations. Shannon Brown, the senior vice president for human resources at FedEx Ground, comments that “people have very similar objectives when it comes to their work,” but he adds that “people want different opportunities at different phases in their lives…. I think our work is going to be more reflective of the individual.”
This also means that employers will end up prioritizing their commitments to employees in a more varied fashion. Different workforce segments merit different levels of investment. As Professor John Boudreau of the Center for Effective Organizations at the University of Southern California’s Marshall School of Business says, organizations should manage human capital like a portfolio, identifying their most “pivotal” talent segments and focusing learning and development efforts accordingly.
• Attracting and retaining talent through employer branding. A strong employer brand can maximize an organization’s position with the labor pool. Witness Novartis. In his interview, HR head Jürgen Brokatzky-Geiger told us that the company hired 17,000 people worldwide in 2006, but received more than 300,000 applications. “This is clearly an extremely popular place to work,” he says.
The best employer brands focus on just a few key attributes, often articulating a clear shared purpose that rises above the profit motive. As Prahalad says, a compelling brand includes “a big idea and a noble goal. It goes beyond shareholder wealth; it’s something intellectually demanding and emotionally satisfying.” So far, relatively few companies are taking full advantage of the concept of employer branding, but those that do will reap the benefits as they strive to attract and retain talented people.
• Creating unconventional talent acquisition strategies to look ahead and act with prescience. In tight labor markets, accurately forecasting and buying into future talent needs is an essential skill. E.ON AG, Germany’s fast-growing energy service provider, realized this when a wave of privatization overtook the power generation sector in central and eastern Europe. “We have learned to launch an ambitious and proactive recruitment drive in anticipation of those needs,” says Chief HR Officer Christoph Dänzer-Vanotti. “This might cause a temporary managerial ‘underload,’ in which some of our managers are not sufficiently occupied. But when the rapid expansion comes, we can hit the ground running.”
Organizations must also be prepared to act whenever exceptional talent appears. ThyssenKrupp did this by establishing a special hiring fund in its technologies business. “This budget is for building our talent pool in that specific business, not for traditional hiring,” explains Ralph Labonte, executive board member and labor director. “When we find great people, we’ll hire them first and then look around to see what they should do.”
Some significant innovations involve the development and retention of people after they are hired:
• Recognizing that high performance requires great leaders. Successful leaders are those who, as Satyam founder Ramalinga Raju says, “can enable ordinary people to achieve extraordinary results.” These leaders, through their example and influence, directly drive higher levels of employee engagement and retention.