Magazine article Journal of Property Management

Anchoring Talent Management to Business Performance

Magazine article Journal of Property Management

Anchoring Talent Management to Business Performance

Article excerpt

LEADERS ARE SEARCHING FOR ANCHORS AS THEY STEADY THEIR CORPORATE SHIPS IN RESPONSE TO THE NEW NORMAL BROUGHT ABOUT BY RECENT ECONOMIC CHALLENGES. FORTUNATELY, THE FORECAST IS BRIGHTER AS EMPLOYMENT STABILIZES, BUSINESSES RECOVER AND ORGANIZATIONS STRATEGICALLY GROW THEIR WORKFORCES. A RECENT TALENT SURVEY BY AON HEWITT SHOWED THAT 45 PERCENT OF RESPONDENTS ANTICIPATE SLIGHTLY TO SIGNIFICANTLY GREATER HIRING VOLUMES IN THE COMING YEAR, WITH AN INCREASED FOCUS ON THE QUALITY OF CANDIDATES.

This increase in hiring means that companies are now competing on the basis of the skills and talents of employees. Companies are discovering that by attracting and retaining the best and brightest employees, they can achieve higher-than-average market share and elevated profits. As a result, the word "talent" is now being more narrowly defined as a core group of leaders, technical experts and key contributors who can drive a business forward. Companies that have systems and processes aligned to business outcomes are adapting and doing well navigating the waters of talent acquisition. The real estate industry is in a talent crisis largely due to a reduction in available talent, a fragile platform to retain outstanding talent, escalating employee turnover and fragmented human resource strategies--including compensation and benefits.

To succeed in this new world, companies such as those in the real estate industry must develop an integrated talent management framework that closely ties to business performance. Organization leaders must pay greater attention to employee engagement--which will increase customer satisfaction, reduce employee absenteeism, reduce workplace accidents and increase employee creativity and productivity--all of which combine to make a more profitable enterprise. Employee engagement is one of the few determinants of profitability that is largely within an organization's control, so a fully integrated talent management framework becomes crucial for the organization as a whole.

EMPLOYMENT TRENDS

The U.S. Department of Labor predicts U.S.-based employers will need 30 million new, college-educated workers in the next decade, while only 23 million young adults are expected to graduate from college between now and 2020. Fast-breaking technological breakthroughs in products and services will create a demand for new jobs requiring complex skills. Employees in highest demand will be technologically literate, globally astute and intellectually curious.

Meanwhile, as baby boomers leave the workplace, they are taking with them the depth of their experiences. As a result, the U.S. workforce is seeing a decline in the number of workers and a shortage of experienced workers. Replacing those employees with a person who fits the job description is not as simple as it may seem because the generation that follows, "Generation Y" (those born between 1980-2000), comes with a different set of expectations.

Employee retention also has become paramount, particularly in the real estate industry. Several studies report that employee turnover in real estate firms averages 33 percent, and at least 60 percent of real estate firms do not have contingency plans for employee turnover. The hidden cost of this turnover is estimated to range from 30 percent to 300 percent of an employee's annual cash compensation. Today's workers also are changing jobs more frequently than in the past. The average length of employment in all age groups has been declining gradually over the past several decades. The time, energy and money invested in new employee training and orientation is lost when an employee leaves.

INTEGRATED TALENT MANAGEMENT SYSTEMS

One way to mitigate these costs and better manage the hiring process so that it more closely aligns with the company's business goals is to put in place an integrated talent management framework. The framework below illustrates a nucleus from which to begin a talent management process. …

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