You Need To Change How You Value Talent
And view employees as the assets they have always been.
I recently spoke with the founder of a tech startup in the virtual event space who was riding a massive windfall.
He had become stretched increasingly thin trying to manage a fast-growing team and knew that without getting some fundamental people processes in place, things were about to go off the rails.
Exasperated, he recounted the moment when he realized he needed to bring in a full-time human resources leader.
“Sorry — Someone told me I’m not supposed to call it ‘human resources’ anymore,” he corrected himself.
“It’s ‘talent management’ now.”
He wasn’t wrong. More and more organizations are re-branding their ‘human resources’ (HR) function as ‘talent management.’
But his awareness of this reveals more than just a department re-naming trend. The naming convention is nothing more than a symptom stemming from a broader movement.
Things are changing within the talent space, and it’s fundamentally reshaping how today’s organizations view their human capital.
Before we look forward, let’s first look back.
4 categories of human resources
Historically, there have been 4 main categories of work within the human resources function.
The first, and most tactical, is HR Administration. This category encompasses all the tasks that go into managing people and their employment. It includes things like making sure people get paid (yes, please!), administering benefits, and ensuring compliance with labor laws.
Next, is HR Service Delivery which focuses on how information is disseminated to employees and includes things like town hall meetings, newsletters, or maintaining the company’s intranet site.
The third category is Workforce Management (WFM) which is concerned with optimizing resources to maximize productivity. WFM is all about the management of time and attendance through activities like budgeting, forecasting, and scheduling.
The fourth and final category is Talent Management which includes any process related to attracting, recruiting, developing, and engaging employees. This category is where the strategy behind growing and maintaining a competitive workforce comes to life.
It’s also the new and improved version of HR.
In many ways, the work categorized in the administration, service delivery, and WFM siloes is the stuff that’s given HR a bad name all these years. They’re the reasons HR was originally viewed as an ‘expense center’ vs. a ‘strategic partner’ many years ago.
But, like every industry, technology has changed the landscape for HR professionals. Administrative work has become increasingly easy to automate or transition to a self-service model. For many of us, our roles are now entirely focused on talent management.
As HR departments have evolved to become more strategic and less tactical, organizations have concurrently begun to view their human capital differently, as well.
Coincidence? I think not.
In a recent white paper, the World Economic Forum detailed this shift and said, “a resetting of strategy and metrics that value talent as an asset rather than an expense is critical for companies under pressure to operate more efficiently, build resilience and create value from their workforce investments.”
Here are 3 of the main shifts companies are making in the spirit of valuing talent as an asset rather than an expense.
The shift from profits to purpose
Over the years, many companies have formally communicated or informally signaled that their purpose for being in business is to maximize profits for shareholders.
But, if I’m a dedicated employee, where does this leave me?
Is making some obscure shareholder rich supposed to give me a sense of purpose?
I don’t think this is enough to get most of us out of bed in the morning, and it hasn’t been enough for a long time.
Business Roundtable evidenced this when they released their Statement on the Purpose of a Corporation in 2019. It was signed by 181 CEOs who committed to lead their companies for the benefit of all stakeholders — customers, employees, suppliers, communities, and shareholders.
The CEOs who signed the statement committed specifically to:
Investing in our employees. This starts with compensating them fairly and providing important benefits. It also includes supporting them through training and education that help develop new skills for a rapidly changing world. We foster diversity and inclusion, dignity and respect.
Tricia Griffith, CEO of Progressive and one of the statement’s cosigners, said “CEOs work to generate profits and return value to shareholders, but the best-run companies do more. They put the customer first and invest in their employees and communities. In the end, it’s the most promising way to build long-term value.”
Simply maximizing shareholder value is no longer enough. The best companies do more in the name of their employees.
The shift from corporate policy to social responsibility
Companies have always relied on their codes of conduct and value statements to define acceptable behavior at work.
The report says, “we see progressive companies with strict protocols for respecting differences and diversity in all its forms — gender, race, age, sexual orientation, ability, and other characteristics. Any infringement can lead to disciplinary action.”
But companies are beginning to take this a step further and reconsider how the employment contract intersects with the social contract. The report says:
“With mounting pressures and expectations for organizations to be strong actors in their ecosystems and become more human-centric — for the benefit of the business and all stakeholders — there is a call for codes of conduct and corporate values to apply both within and beyond the organization.”
The social movements of 2020 have provided organizations with an abundance of opportunities to do this, and many have risen to the challenge. Going forward, the companies who don’t believe ‘it's their place’ to comment on social issues will stand in stark contrast to those who do.
And as more adopt this stance, both the employment contract and the employee’s value to the organization will evolve.
“It will be important for companies to be able to rely on their workers to represent the business in this broader context and to value them accordingly,” the report says.
The shift from employees and jobs to people, work, and skills
Today‘s organizations have more ways to get work done than ever before. Contingent work, artificial intelligence, process automation, and outsourcing are just a few of the options the report outlines in addition to the traditional full-time employee (FTE) model. As such, the report stresses the importance of embracing a more agile way of working.
“The traditional one-to-one relationship between a degree matched to a person matched to a position is giving way to a many-to-many relationship with multiple micro bite-sized on-demand learning opportunities matched to multiple skills matched to multiple ways of getting work done.”
This mirrors the insights from ADP’s 2018 Global Study of Engagement which found that 21% of full-time gig workers are fully engaged compared to just 15% of FTEs.
Their recommendation? Make all work more like gig work.
The World Economic Forum report says, “this approach, combined with technology, can make for a more human-centric enterprise in which people focus on higher-value, non-routine work.”
We don’t want to be relegated only to work outlined within the narrow confines of our job descriptions. We want to be known for the unique skills we bring to the table and matched with work (projects, assignments, etc.) that allow us to use our strengths each day. We want to do work that lights us up.
If we can make all work more like gig work, we can achieve unprecedented levels of engagement.
The parallels between the evolution of ‘human resources’ to ‘talent management’ and ‘employees as an expense’ to ‘employees as an asset’ are not lost on me. And I don’t think that our employees have fundamentally changed in ways that suddenly made them more valuable, either.
Could it be that as the talent management function evolved to become more strategic, its practitioners have become better equipped to demonstrate the impact employees have on the business’ results?
Might this be the reason that today’s business leaders are finally starting to see and treat employees as the assets that they have always been?
After all, we can dedicate much more time to understanding the intricacies of engaging our workforce when we’re not bogged down processing TPS reports.
Our people are our biggest asset. They always have been.
It’s time we treat them that way.
Not a member of Medium yet?
Join here to directly support my work and get access to every story on Medium. You can also subscribe to my free newsletter or connect with me on Linkedin.