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Creating an effective talent development pipeline

Author: ICAEW Insights

Published: 24 Feb 2023

Post-pandemic, the world of work is changing fast. Businesses must do more to ensure employees have a clear development path if they are to keep and attract more talent.

Organisations were already experiencing cultural transformation at a steady pace when the global pandemic thrust those changes onto the entire global workforce. Some of these workplace transformations, such as remote working, continue. 

For the first time in a long while workers have some leverage: organisations face a shortage of staff and salaries are rising. Moreover, employees have proved to managers that they are more than capable of doing their jobs remotely, thanks to new technologies. Growing protectionism among some nations also means the free flow of workers we have become used to has slowed, and in some cases stopped. On the flip side, structural economic shifts and the lack of investment in employee skills means many people don’t have the digital capabilities needed to advance in the new world of work.

These changes have forced HR managers and external recruiters to rethink recruitment, retention, career progression and employment in general.

“Given the current market, smart employers are having to spread their nets wider and rethink hiring strategies,” says executive coach Liz Sebag-Montefiore, director and co-founder of HR consultancy 10Eighty. “There’s a recognition that in the past, we may have been a little too rigid in thinking about who we hired and where we found them. There’s much more appetite for attempting to establish a more diverse workforce and working with different kinds of talent

Indeed, it isn’t just economic and technological shifts that are forcing workplaces to change. Societal norms have shifted too, with a growing evidence-based recognition that more diverse workforces offer substantial performance benefits.

Today, society demands more equality between men and women as well as inclusion of those people who have for too long been sidelined in the workforce, such as many vulnerable groups. Age is another area of focus, as more and more research highlights how difficult it has become for older employees to seek new employment opportunities.

“Diversity and Inclusion are crucial to building a talent pipeline; it’s hard to source and hire at present and we need to be much more open to less conservative, more broad-based recruitment policies. We need to work on reaching and engaging with a diverse range of candidates. We tend to have quite fixed ideas about who will fit in, where they come from, what their CV looks like, etc. We need to rethink and focus on talent and potential,” Sebag-Montefiore says.

Strategy first, data next

Developing a clear talent management strategy is essential to determine future workforce needs. Understanding your workforce supply and demand, demographics, predictions for skill shortages, the labour market and workplace trends will all need to be factored into that strategy.

A talent management strategy, according to advice from the Chartered Institute of Personnel and Development, should include components such as building talent ‘pools’, lifelong learning, leadership development, career and performance management, as well as employee engagement and succession planning. For too long, employers have focused on hiring to fill skills gaps, but HR experts say a more holistic talent management approach is needed. This includes developing clear pathways for parents and carers, for example, who are returning to work after a child-rearing or caring break.

Added to this, says Graham Glass, a learning development expert and CEO at Cypher Learning: “Too many businesses overlook talent already within their ranks, and default to external hires. With a culture of cross-skilling present within businesses, hiring managers may [then] see that the skills required are already available in house. Employees can be moved from a different team to apply skills where needed.”

A skills-based approach not only will save time, resources and money in the recruitment process, but it is also likely to engender employee engagement and satisfaction, not to mention diversity. Janice Burns, chief people officer at upskilling platform Degreed, says: “Taking a skills-based approach will enable finance leaders to broaden their talent pool and find candidates from more diverse backgrounds. This involves matching people to a role or project based on their skills, not their credentials, connections or academic pedigree. It’s a fairer way that benefits everyone.” 

For an effective talent management strategy, organisations will need to draw on the right skills data. This would have to be proactively managed by ensuring HR managers receive feedback once a project is completed, so they can understand any skills gaps. “Consolidating this data will give you the insights needed to match people to work and to understand your talent pipeline with greater accuracy. You’ll be able to spot skill gaps more readily, upskill your people for future needs, and hire the best people for a role,” Burns says.

Accountancy firms and businesses have already changed many recruitment practices – such as only targeting university graduates with 2:1 grades or those studying more traditional disciplines such as maths or geography. More and more firms have developed strategies to attract school leavers, dropping the 2:1 grade level and promoting and highlighting the need for diverse workforces.

Visible role models are also vital. For example, Asian or Black female partners in accountancy firms are rare, but with the right structures, understanding and experience, career pathways can be designed to foster and encourage women and other previously neglected groups to achieve their own career goals.

Of course, talent development and succession planning are as much about flexibility and agility as skills and hiring practices. The more organisations become more flexible and adaptable to the myriad challenges facing the world, the more employees will be open to embracing the change that’s required for us all.

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