Weekly Wrap: Too Many Companies Have a Talent Pipeline Problem

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Mar 20, 2015

There are a lot of things that drive employees crazy, but here’s a big one: When management goes outside the organization and bypasses internal candidates when there is a position to fill.

For some reason, business leadership fails to see how damaging it is to morale and company culture when everyone feels that people inside the organization are consistently passed over, for promotions or more interesting assignments, in favor of outsiders.

In other words, somebody from the outside is better than anybody on the inside.

This issue came up in this recent study from Lee Hecht Harrison, the company that handles outplacement services for so many out of work employees, when they surveyed nearly 400 HR and talent management leaders in the U.S. this past January.

Companies have talent pipeline problems

What they found is this: A third of employers think that their internal talent pipeline is poor or non-existent, and only 4 percent thought that their talent pipeline is excellent.

Maybe this explains why so many go outside rather than promoting from within.

In the study, when employers were asked, “Looking ahead our talent pipeline is … ” they answered like this:

  • Excellent — 4 percent;
  • Good — 58 percent;
  • Poor  — 30 percent;
  • Non-existent — 3 percent;
  • Don’t know  — 5 percent

“The reality is that few organizations are confident about their internal talent development efforts or their ability to fill key skills gaps,” said Kristen Leverone, Senior Vice President for Lee Hecht Harrison’s Global Talent Development Practice, in a press release about the survey. “It is increasingly difficult to find and recruit good people and this can vary significantly by geography, level, industry and skills. Building bench strength is a challenge.”

Not enough career conversations going on, either

I’m hardly surprised by these findings, and if anything, they’re better than I expected. Given how little so many organizations have spent on training and development since the Great Recession started back in 2008, I thought these numbers would be a lot worse because companies have skimped on developing their own, and promoting from within doesn’t seem to be a priority.

What DID surprise me a bit was this other survey finding, the one that asked about the kinds of career conversations (and respondents could indicate more than one) that managers are conducting with employees. Here’s what they found:

  • Annual performance reviews — 87 percent;
  • Ongoing informal conversations — 56 percent;
  • In-the-moment feedback — 42 percent;
  • Regular formal conversations — 30 percent;
  • Internal networking — 16 percent;
  • Other  — 6 percent.

The “Other” category, according to Lee Hecht Harrison, consists of “talent reviews, employee initiated conversations, quarterly performance conversations, 360 degree feedback assessments, stay interviews, and individual development plans.”

Employees are growing increasingly restless

I don’t know about you, but reading that only half of talent managers have ongoing, informal conversations with employees about their career development is both depressing and scary.

No wonder so many organizations feel their talent pipelines aren’t working; it’s because they simply aren’t spending enough time talking to their people about where their careers are going.

Lee Hecht Harrison’s Kristen Leverone had this same reaction.

“Employees need to know about opportunities for career advancement— how they can continue to learn and grow to meet the changing needs of the organization,” she said. “This requires regular coaching conversations between managers and employees related to the employee’s performance, development and career.”

And, she added this observation about the growing restlessness of employees everywhere:

Increasingly disengaged in their current roles, employees are poised to change jobs in hopes of moving their careers in more rewarding directions. They’re seeking new challenges and greater meaning. To retain high value employees, managers must step up and provide employees opportunities to grow in their roles and demonstrate a commitment to internal talent mobility. Without a plan or strategy for retention and development, organizations may lack the skills needed to fill key roles and face talent gaps that are becoming increasingly difficult to close.”

Too many companies are hitting the “snooze” button

It’s been said time and again that developing employees — especially the next generation of leaders — is critical to growing a business, but far too many organizations remain stuck in the recession mode where cost-cutting, stinginess, and a short-sighted focus on the bottom line seems to be the modus operandi

Building a strong talent pipeline takes a lot of work, and a commitment from top leadership is critical to make it an important, ongoing part of the organization’s cultural DNA.

One would hope that surveys like this would be a wake-up call that it simply isn’t happening in all-too-many organizations. I hope for that too,  but I’ve seen far too many surveys saying things like this, and at a certain point, it’s clear that Corporate America just doesn’t seem to get the message.

Maybe they don’t think these surveys apply to them, but when the wake-up call comes, they roll over and hit the “snooze” button. And, that’s exactly why their talent pipelines aren’t feeding them the people they need to compete in this increasingly competitive world.

Worst workplace idea — ever?

Of course, there’s more than surveys about talent pipeline problems in the news this week. Here are some HR and workplace-related items you may have missed. This is TLNT’s weekly round-up of news, trends, and insights from the world of talent management. I do it so you don’t have to.

  • Is this the worst workplace idea ever? Starbucks attempt this week to get baristas to talk with customers about race relations is one of those ideas that you applaud in principle but know will be a disaster in practice. Ramesh Ponnuru at Bloomberg had a pretty typical view of the impact on the workforce when he wrote, “I would suggest … that (Starbucks CEO Howard) Schultz think a bit more before telling his employees to start these conversations. That seems unfair to the employees, who usually seem pretty busy when I go in. It’s discourteous, as well, to customers who came to the counter for something else entirely. Some of them might also have jobs to get back to.”
  • Creating a handbook employees will really want to read. Fast Company had a great article recently on why it’s important for companies to put together an employee handbook that employees will actually read. They said: “Let’s face it, most handbooks aren’t exactly page-turners. They’re documents designed to play defense or, worse yet, a catalog of past workplace problems. But it doesn’t have to be that way. Your employee handbook should be the road map for how to operate within your company — an introduction to your culture and a guide that your employees interact with on a regular basis. If you believe in your company’s vision, policies, and procedures, you should want every employee to read and use them. So here’s an idea: Write an employee handbook your employees will want to read.”
  • Yet more management lessons from the clueless boss in Office SpaceThe movie Office Space never gets old, and one of the great characters in the film is an incredibly clueless manager by the name of Bill Lumbergh and played by actor Gary Cole. Software development firm Atlassian has brought him back for a series of ads, and they’re just about as funny as the original film. Here’s another one you should enjoy: