Talent management: Room for improvement

PwC launches it's inagural HRD survey

Just 31% of respondents to PwC Ireland’s HR Director Pulse Survey have formal and developed talent management programs in place. This is appears to be at odds with CEOs, who see the availability of skills and talent as the key threat to their growth prospects. The retention of key talent is a top priority for 40% of the HR leaders, however over a third (34%) said that the ability to manage talent is the top skills gap within the HR function.

PwC today launches its first HR Director Pulse Survey. Other key findings in the survey include:

  • 55% of Ireland HR leaders indicate that are experiencing skills shortages in their organisations right now; 27% of these gaps are in IT
  • A third (34%) indicated that they are planning to increase employees into Ireland from within their organisations abroad
  • 52% are favourable about the prospects for their own businesses in the next year; however, just over a quarter (27%) is favourable about the prospects of Ireland’s economy
  • 81% plan to increase or hold employee levels

Speaking at the survey launch, Ciara Fallon, Director, People and Change Management, PwC said: “The survey suggests that there is room for improvement in Irish businesses where talent management is concerned. An effective talent management programme, that is properly managed, can have a huge impact on redirecting key talent in the areas needed most. Organisations have to rethink their talent pipeline and transform their HR function to deal with new priorities and risks.

Recruitment - Search professionals are popular in the hunt for key talent

Nearly two-thirds (64%) said that they use executive search professionals to source key talent. The top criterion for selecting such professionals is sector expertise/knowledge. At the same time the survey indicates that some 60% of all recruitment activity in Irish businesses is sourced through in-house recruiters.

Mobility - On the increase

The survey suggests that many Irish based organisations are planning relatively high levels of employee mobility within their workforces. For example, nearly half (46%) indicated that they have plans to increase employees working outside of Ireland. However, 43% said that they either have no satisfactory method for tracking frequent business travellers or are not sure. The absence of such mechanisms significantly increases the compliance risks, leaving employers unable to identify certain tax and social security liabilities as well as other immigration and personal security risks, often until it is too late.

Gerard McDonough, HRS Director, PwC, said: “A properly designed mobility policy is critical to ensure international business success, as companies strive to have the right talent, in the right place, at the right time and at the right cost”.

Employee engagement - A top priority

Only half (51%) of the HR leaders confirmed that they measure employee engagement. This is despite the fact that the top HR priority identified for the next 18 months is managing employee engagement (53%). The most common approaches used to measure employee engagement, according to the survey, are informal feedback (66%); annual people surveys (59) and performance ratings (44%).

Ciara Fallon added: “Organisations that move beyond simply measuring employee satisfaction and focus on using engagement intelligence can enhance their overall business success as they establish linkages to organisational performance measures”.

Reward - Significant change is on the way

Over half (53%) of the HR leaders indicate that they will change how performance management and reward are aligned. Nearly a third (31%) say that will change the type of health plans employees can choose and 19% will reduce overtime payouts. Over half (58%) report that their overall reward strategy is set globally. In an environment where compensation costs are under scrutiny, organisations need to make transparent choices in terms of reward spend.

The HR function and the business - Majority are involved in corporate decision making

Over three-quarters (78%) of Ireland’s HR leaders report that they have a place at the ‘top table’ and contribute to corporate decision making. The top internal skills gaps within the HR function, according to the survey, are talent management (34%); consulting skills (31%) and HR analytics (29%). The most common metrics operated by HR functions, according to the survey, are absenteeism rates (83%); compensation and benefits/reward (78%) and staff turnover (76%). The survey indicates that less focus is placed on ‘commercial’ metrics such as return on people investment (2%); productivity (31%) and absenteeism costs (37%).

Gerard McDonough concluded: “The survey suggests that many organisations are unclear about how they can create a sustainable talent pipeline for the long term. Organisations need to manage their talent supply chain with the same rigour that they would apply to other parts of the business. They must focus on making their businesses the most attractive to the best talent, while at the same time aligning this talent with the most pressing opportunities – locally and internationally”.

ENDS

Notes to editors:

The survey was carried out in December 2012 having over 80 respondents from Ireland’s leading businesses and representing all industry sectors. The ownership of companies surveyed was multinationals (42%); private companies (32%); public companies (18%) and semi-state bodies (8%).

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