Talent – Why it’s Critical
“Why have these companies (Google and Gilt Group) succeeded? It’s not the idea – it’s the people. Execution is what matters, and execution relies on human talent.”
Kevin Ryan, Founder and CEO of Gilt Group
Harvard Business Review, January-February 2012
Fourteen years ago McKinsey consultants Elizabeth Chambers, Mark Foulton, Helen Handfield-Jones, Stephen Hankin and Edward Michaels published The War for Talent. Four key drivers of the need for better talent were identified:
- A more complex global economy
- Intensified competition
- Increased investor/stakeholder expectations
- Increased spans of control and scope of roles
Things have changed – these drivers have intensified.
Research by McKinsey& Company provided conclusive evidence that:
- Companies which proactively manage their talent generate 22% higher return to shareholders; and,
High performers deliver significantly better results than do average performers
- 67% increased revenue in sales roles.
- 49% increased profit in general management roles, and
- 40% increase in productivity in operations roles.
Despite compelling evidence of the impact of talent on organizational results, my experience is that few organizations actually manage talent well. Executives espouse the values but fail to “walk the talk”.
Further research my McKinsey determined that the percentage of executive who “Strongly Agree” with the following statements are as follows:
Brings in highly talented people 19%
Develops people quickly and effectively 3%
Retains almost all high performers 8%
Removes low performers 3%
Know who the high and low performers are 16%