Talent Management, Performance Culture & Leadership Supply

CEOs worry about having the right people in key jobs—they know it's key to ensuring great decisions and execution. But most are frustrated by the time and effort it takes to kick-start their organizations' talent machine. Building a talent-rich organization is in fact a multiyear challenge. But three specific steps will not only have an immediate impact on a company's talent supply, they will also lay the foundation for longer-term moves.

• Quantify the talent gap. A rigorous analytic picture of the gap between the supply of and demand for talent makes the challenge visible. Suddenly the talent issue can no longer be shuffled off to the human resources department; it is now on everyone's agenda, including that of the board.
• Deploy existing talent more effectively and recruit selectively. Too many companies suffer from "grade inflation" and don't know who their top performers are. As a result, those individuals may not be in the jobs with the greatest impact on key decisions. Identifying those jobs and filling them with highly skilled individuals, recruited externally if necessary, can have a big impact on performance.
• Reduce the demand for talent. Organizations that simplify their processes and clearly spell out accountabilities can simultaneously lower costs and reduce the need for specialized skills. One South Africa-based mining company, for example, standardized production methods, equipment, engineering and so forth across all its mines and processing plants, making it easier for less experienced managers to get up to speed when they take over a new facility. That increased the available pool of managers and allowed higher-skilled people to take on jobs with larger spans of control.

These steps help leaders address their talent challenges quickly. They also build longer-term commitment for the actions that take more time to bear fruit—changing recruiting strategies, building new training and mentoring programs and the like.

Performance Culture

Company culture is at the heart of competitive advantage, because it determines how things are done and how people behave; it is the hardest thing for competitors to copy. High performers create an environment with a unique personality and soul, and with a passion for performance—so that people make the right decisions and do the right thing wherever they are in the business.

A true high-performance organizational culture provides a company with its single greatest source of competitive advantage. The culture inspires people to go the extra mile–to make and execute good decisions even when nobody's looking. But fewer than 7 percent of companies actually succeed in building a winning culture, and even the ones that do so may find it hard to maintain.

High-performance cultures have two central characteristics:

• Each one is unique. Some companies, have a powerful organizational personality–a "soul"–derived from a deep heritage. Others, create their own distinctive environment. This potent combination of values, character, rituals and beliefs creates a deep bond with employees, making their work unusually meaningful and rewarding.
• But all foster a similar set of behaviors. However distinctive such corporate "personalities" may be, they all encourage remarkably consistent patterns of behavior. People in these organizations care passionately about winning. They orient themselves outward, focusing on customers and competitors rather than on internal politics. They think like owners and have a bias to action. They build teamwork and are open to change.

Creating and maintaining such a culture is challenging, but it can be done. Leadership is key. Cultural change won't happen unless leaders themselves model the behaviors and values that define the new culture. The most effective leaders also spread the word through constant personal contact and communication, particularly with "linchpin" employees who will buy in to the culture and whose words will carry weight with others. They don't shrink from making the organizational changes necessary to support the new culture–for example, altering incentives, redistributing decision rights or streamlining processes. They rigorously track their progress as the culture evolves to make sure performance stays high.