LITERATURE REVIEW: CONCEPTS
2.4 Towards Redefining Talent Management
which are the differentiating factors between TM and HRM (Collings and Mellahi, 2009; Silzer and Church, 2010; Minbaeva and Collings, 2013).
A fourth category related to the third involves the management of talented people. Such definitions emphasises the management of high performers, which is variously referred to as ―A performers,‖ ―high flyers‖ or ―topgrading‖ (Stahl et al., 2007). Some definitions in this category advocate filling all organisational roles with
―A performers‖ (Smart, 1999). The difficulty in this stream of definitions is the overemphasis on ―A performers.‖ This may run the risk of discouraging teamwork and collaboration since it places individual performance over group performance (Mellahi and Collings, 2010). The final category of definitions emphasises the identification of strategic positions which have the potential to differentially impact the competitive advantage of the firm (Boudreau and Ramstad, 2005; Collings and Mellahi, 2009; Gallardo-Gallardo et al., 2013; Minbaeva and Collings, 2013).
These definitions not only recognise the importance of workforce segmentation and differentiating in terms of people, but also positions. As a result, the starting point according to Collings and Mellahi (2009) is the identification of strategic positions rather than talented individuals per se. Whereas this category of definitions appears to end the controversy surrounding the definition of TM, it seems to be disconnected from the business strategy that calls for the implementation of TM strategy (McDonnell, 2011). This is what McDonnell (2011: 170) called the ―business case for talent.‖ It also appears to focus on filling key and strategic positions with high-performing incumbents. Therefore there was a need to redefine TM for this study and the next section explains the proposed definition.
the starting point and flowing from this, the organization needs to ensure that they possess the talent to execute it.‖
Another limitation of most of the current definitions is their emphasis on the development of high-performing incumbents in filling these roles. While it is cheaper and easier to fill key positions with incumbents, such positions could also be filled by
―A performers‖ outside the organization, especially when incumbents are below standards or require additional development to take up such positions. In this study TM is defined as:
the identification of key and strategic positions that drive the performance of the organisation, the development of a pool of high potentials as well as the recruitment of ―A performers‖ to fill these roles, the management of talented employees through a differentiated human resource system, and the alignment of TM to business strategy to ensure congruence and fit.
This definition emphasizes that TM strategy needs to be aligned with business strategy. A number of studies have been drawn from the extant literature that calls for the alignment of TM to business strategy. For instance, Ashton and Morton (2005) advocated that organisations should take a systematic approach to TM by aligning TM strategies to business goals, incorporating all related processes and systems and creating a ―talent‖ mindset‖ in the organisation.
It has been stated that companies that stand out in terms of TM have implemented a system that is internally consistent and reinforces the practices they use to attract, select, develop, evaluate, and retain talent, which are strongly aligned to their business strategy (Beechler and Woodward, 2009; Ernest and Young, 2010).
According to Avedon and Scholes (2010), TM will be valuable if it is driven by the short- and long-term needs of the business. Therefore, it is not sufficient to carry out people management practices in a linear style in order to be successful because the logic behind TM is integration (The Boston Consulting Group, 2012).
That is why Boudreau and Ramstad (2007) stated that TM is a decisional science in which talent is connected with strategies, while Lewis and Heckman (2006)
added that TM creates a linkage between employees and organisational strategies.
Tarique and Schuler (2010) advocated that TM strategy should be aligned with business strategy. In fact, Guthridge et al. (2006: 8) stated the following in this regard:
TM cannot be isolated from business strategy, those that rely solely on the HR department to drive their strategy for talent are missing an opportunity to align the behaviour and capabilities of the workforce with the priorities of the business.
In other words, linking TM to business strategy ensures that TM stays aligned and is monitored and measured throughout the firm. Yost and Plunkett (2010) maintained that effective TM practices are always designed and implemented in the milieu of the business strategy. This is because every organisation needs to differentiate itself from its competitors through its choice of strategy if it wants to thrive and survive. They added that this will help the organisation create a differentiated workforce strategy as a tool to be competitive in order to survive. TM must begin with the business strategy and continue with the goal to develop and maintain a ―nursery‖ of talent, which would require employees‘ professional qualities, loyalty, and active involvement (Campeanu-Sonea, Sonea, Gabor-Supuran and Muresan, 2011).
Recognising the influential role of business strategy on TM, Bersin and Associate (2007) developed a model that portrays TM as a contiguous process, starting from the business plan or the strategic objectives of the organisation. Bersion and Associate added that a business plan lays down the direction and strengthens the talent effort that further helps the organisation identify talent-related challenges, and design the relevant HR processes and talent strategies. On the whole, Bersin and Associate submits that the business strategy sets the direction for descriptions, offers the necessary procedures for workforce planning, staffing, training and development, compensation, and planning, and chooses the standard for performance management.
As noted by Lockwood (2006), organisations that understand the business case for TM successfully link TM to organisational strategy, leading to increased workplace performance. In other words, companies that align their TM strategy with
their business strategy not only achieve greater success and organisational excellence but also succeed in the current and future demand for talent. The importance of the business strategy is mirrored in the way in which it tells talented employees how it separates their firm from the competition in an apparent way. This is because a fuzzy and general strategy will not guide the actions of the talented employees.
It is vital to state the goals of the firm visibly in such a way that they can be measured and that talents can understand their role in achieving the goals. An important precondition for successful TM is that the strategy work be done carefully before implementing TM (Yllner and Brunila, 2013). Furthermore, it is stressed that TM should be tailored to the strategy of the organisation and not be based on the best practices, since this does not give the organisation a competitive advantage. This is based on the view that organisations with a strong link between TM and corporate strategy report higher performance outcomes (Huselid, 1995; Tansley et al., 2007;
Ernest and Young, 2010).
I do agree with Collings and Mellahi (2009) that organisations must first identify those positions that have the potential to differentially impact performance, fill those positions with high-potential and high-performing employees, and manage them with a differentiated HR architecture, but I also agree with a number of authors (Becker et al., 2009; Beechler and Woodward, 2009; Avedon and Scholes, 2010;
McDonnell, 2011) that have called for the congruence between TM and business strategy. Indeed, most organisational decisions are determined by the organisation‘s strategy (Lepak and Snell, 1998). Mills and Snow (1984) for example posit that different business strategies have different characteristics, predominantly in their structure, processes and procedures. Hence, these characteristics make one organisation different from another. The business strategy then influences the HR strategy and the TM strategy. Achieving fit between TM and business strategy makes it a holistic approach that draws on systems, processes, and people.
In summary, my proposed definition of TM consists of four key elements: 1) the identification of key and strategic positions that drive the performance of the organisation; 2) the development of a pool of high-potential and high-performing incumbents as well as the recruitment of ―A performers‖ to fill these roles; 3) the management of talented employees through a differentiated human resource system;
and 4) the alignment of TM to business strategy to ensure congruence and fit. This new definition diverges from previous definitions by taking into account not just the fit between TM and business strategy but also the recruitment of ―A performers‖ to fill strategic roles in the organization if incumbents are below standard or require additional development.
This represents an attempt to redefine TM by drawing from both currently- used research and professional definitions. In today‘s business, firms are not only competing at the national level but also globally. Hence, the prominence of TM has also been researched in multinational companies (MNCs) and at the global level, and these studies concentrated on what is called ―Global TM.‖