Tm Fact Book 2010 | Talent Management | Strategic Management

Talent Management Factbook 2010

Best Practices and Benchmarks in U.S. Talent Management

Karen O’Leonard,
Principal Analyst

Stacey Harris,
Principal Analyst September 2010

© BERSIN & ASSOCIATES FACTBOOK REPORT | V.1.0

Talent Management Factbook 2010

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Talent Management Factbook 2010

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TABLE OF CONTENTS
Introduction Executive Summary
1. Restructuring Consolidates Talent Processes 2. More Companies Are Developing a Talent Management Strategy 3. Integration Is Still in the Early Stages 4. Competencies Are the Foundation of Talent Management 5. The Challenge of System Integration 6. Integration Pays off 10 10 8 9

5 7
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What Is Talent Management?
Talent Strategy Workforce Planning Capability and Competency Management Talent Acquisition Leadership Development Succession Management Career Management Performance Management Total Rewards Learning and Capability Development Organization and Governance Business Metrics and Analytics Talent Infrastructure

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13 14 14 15 15 15 16 16 16 17 18 19 19

Talent Strategy and Planning 21
Who Is Considered “Talent?” 26

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Talent Management Factbook 2010 4 Organization and Governance 28 The Right Mix of Skills Business Ownership of Talent Management 38 39 Talent Management Maturity 41 The Path to Integration Fostering Integration 48 59 Measuring Success What Metrics to Use? Metrics from Our Study 62 62 67 Impact of Mature Talent Management Impact on Turnover and Promotion Rates Impact on Employee Productivity What Maturity Level Is Right for Your Organization? 76 80 82 83 Talent Systems System Integration Impact of Talent Systems Keys to a System Integration Strategy 85 87 90 94 Appendix I: Study Methodology Appendix II: Key Talent Integration Points across Talent Processes Appendix III: Table of Figures 98 102 108 About Us About This Research 111 111 Bersin & Associates © September 2010 • Not for Distribution • Licensed Material .

In addition. But perhaps the biggest influence on talent strategies has been companies redefining their business strategies and goals in light of the new economy. May 26. in turn. motivate and retain employees in an environment of limited career advancement. Another factor shaping corporate talent strategies is projected job growth. creating an environment of low morale. This.Talent Management Factbook 2010  Introduction As the economic recovery unfolds. with resulting shifts in the talent needed to achieve these goals. from workforce planning and recruiting to retention and compensation strategies. with only modest job growth expected in the near term. Based on these qualitative and quantitative inputs. with 725 HR managers and executives from a large crosssection of U. often initially turning to outside contractors or part-time workers.-based organizations. Therefore. Specifically. development and rewards programs to make sure that their employees are engaged and working toward long-term goals. companies must find ways to recruit. The research was conducted during March and April 2010.  Source: “More Workers Start to Quit. 2010. disengaged employees are beginning to look elsewhere.” Wall Street Journal / Joe Light. This report summarizes our annual study conducted in partnership with Human Resource Executive. This is a signal to companies to look at their career planning. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . impacts all talent initiatives within the company. For many companies. The Bureau of Labor Statistics reported in February that the number of employees voluntarily quitting their jobs surpassed involuntary terminations (through layoffs or discharges) for the first time since October 2008. The success of an organization’s talent strategy depends on the integration of its talent processes.  Smart companies realize that these talent activities are inextricably linked. As companies start to hire again. Now that the economy is starting to improve. in-depth interviews were conducted with HR executives from a range of company sizes and industries. many are being cautious. the study addresses the following key questions. the last two years have meant restructuring. organizations are taking stock of their talent. KEY POINT Disengaged employees are beginning to look elsewhere – a signal that companies need to get their talent strategies in order. this report provides benchmarks and best practices in talent management.S. layoffs and salary freezes.

com or at (510) 654-8500. if you see areas that you would like to further explore for your organization.S. and what other metrics are being used for evaluating talent initiatives? • What is the impact of talent management on business and talent metrics? After reading this report. motivate and retain employees in an environment of limited career advancement. Karen O’Leonard Principal Analyst Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . companies. • How are companies organizing their talent management functions? • What is an effective roadmap to integrating and improving talent initiatives? • What is the state of organizations’ talent systems and infrastructures? • What are the current rates of retention and promotions among U. please contact us at info@bersin.Talent Management Factbook 2010  KEY POINT Companies must find ways to recruit.

S. 30 percent of U. competency management and talent acquisition.S. Restructuring Consolidates Talent Processes Many companies have consolidated their operations over the past few years in an effort to improve efficiency.S. companies say they have a well-defined talent strategy and Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . performance management. In addition. This restructuring has generally been beneficial to talent management by bringing centralized ownership of talent initiatives. In most cases. 2. Today. companies have a dedicated talent management executive. More Companies Are Developing a Talent Management Strategy A dedicated talent management executive can help to define and implement a cohesive talent strategy by aligning resources and improving the level of coordination across processes. a role that is responsible for some or all of the talent functions across the enterprise. The talent management executive does not typically own the compensation / total rewards function. throughout this report data is broken out by company size and industry. this role is responsible for the talent strategy. 30 percent of U. leadership development. In most companies.  The responsibilities of talent management executives vary widely.Talent Management Factbook 2010  Executive Summary The following are key findings from the research. succession management. companies have a dedicated talent management executive. KEY POINT Today. 1. which often reports up through a different chain of command into the central HR organization. nearly onehalf of U. which are explored in more detail in this report. Today. and learning and development (L&D). workforce planning is also under the charge of a separate person or group. Just more than one-half of the talent management executives are responsible for career management. This figure is up from 21 percent in 2008.

while there is still a lot of room for growth. Organizations typically evolve to this Level over a number of years. companies are making progress. It also requires business leaders and managers to take ownership of talent initiatives – and to be held accountable for talent outcomes. may have systems in place but not connected Level 1: Siloed HR Processes 28% Source: Bersin & Associates.  This Level of Maturity does not happen overnight. a business-driven talent strategy and highly evolved. Two years ago. single person / team responsible for talent initiatives Level 3: Integrated Talent Management 20% Talent processes are consistent and tailorable. with some integration. So. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . several systems connected through manual processes Level 2: Standardized Talent Processes 45% Individual HR processes or “silos”. progressing through a series of stages. 3. talent mgmt. Integration Is Still in the Early Stages Mature talent management calls for an effective governance structure.Talent Management Factbook 2010  are working on implementing that strategy. 2010. integrated talent processes. as depicted in Figure 1. this figure was just 37 percent. Figure 1: Bersin & Associates Talent Management Maturity Model® Fully integrated processes and systems used to make business decisions. is business-driven Level 4: Strategic Talent Management 7% Heavy focus on connecting systems and processes.

it should be laid out as part of the overall strategy. including current state and desired future state. companies define competencies for use in performance reviews. These are used across nearly all talent processes and. and business leaders and managers assume greater responsibility for talent initiatives. the organization begins to identify connection points across its talent processes and to manually link talent systems. then extend these for use in recruiting. Or.Talent Management Factbook 2010  KEY POINT Today. Often. but these systems do not share data. companies are at the stage in which they are beginning to connect their talent processes and systems. for many. therefore. Whatever path an organization chooses. In addition. since these activities have a natural synergy. The organization may have automated talent systems in place (such as an LMS or an applicant tracking system). Only about one in four companies has progressed to Levels 3 and 4. there is one common starting point – competencies. in which talent processes are developed and managed individually. Today. in which talent processes and systems become more tightly integrated. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . In these organizations. 4. The processes and systems are “silos. the organization develops a set of consistent talent processes that can be tailored as needed to meet business-unit and regional needs.” meaning that there is little or no coordination across processes. Here. nearly one-half of U.S. serve as the foundation for process integration. Level 2 is the largest category. A good way to plan for integration is to create a map of talent processes. along with a roadmap for achieving these goals. HR owns talent management initiatives and seeks input from business leaders. Competencies Are the Foundation of Talent Management KEY POINT Competencies are a common starting point for integrating talent processes. Organizations may take many different paths to integrate their talent initiatives (all of which can be successful) but. L&D. with nearly one-half of organizations at this stage. We expect the number of organizations in these top two categories to increase as companies emerge from the recession and refocus on long-term talent initiatives. From here. many companies focus on linking their performance management processes with learning and development. they may look at linking performance management with compensation initiatives. leadership development and succession planning efforts. approximately one-quarter of organizations are at Level 1.

as compared with companies in Level 2 (with standardized talent processes). Companies should first make sure that they have the right people in talent management positions. in addition to an HRIS or employee data warehouse. the organization must first have the right people and processes in place. Building a mature talent management organization takes time and resources. then design the right processes. Talent systems should reinforce the processes. as companies move up the Maturity Ladder (see Figure 1). has reached the potential to move “upward’ in a management capacity. competencies should be stored and accessible in the recruiting.Talent Management Factbook 2010 10 5. their rates of employee turnover decline. our research found that talent systems do not guarantee an organization’s success in meeting talent and business goals. This study shows that. Furthermore. Without this integration between systems. The Challenge of System Integration Integrating talent processes requires sharing data across systems. greater employee engagement and greater success in nearly every talent area. As an example. their promotion rates increase. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . and then choose the right systems to make the processes more efficient. Today. development and talent planning. but it does pay off. 6. companies in Level 4 (with strategic. they have lower turnover. talent management cannot be wholly effective. A well-integrated system infrastructure can help the organization make better decisions about its talent but. performance management and learning management systems. 60 percent of companies have two or more separate talent systems. Integration Pays off KEY POINT As companies move up the maturity ladder. Installing a complicated system or using multiple point solutions that do not share data can be less productive than using simple paper-and-pencil processes. and they score better on employee engagement. is capable of a lateral move. may be qualified for a broader role within the same profession. For example.  A “high performer” is an employee who is a key contributor. business-driven talent management) had one-half the rate of turnover among high performers. as mentioned above. not drive the processes. demonstrates high performance. and. Most of these companies report that the sharing of data between these systems is poor or nonexistent.

Level 4 companies performed better in the following areas: • Twenty-nine percent higher scores on employee engagement. and.  Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . • Thirty-six percent higher ratings on leadership development.Talent Management Factbook 2010 11 In addition. These findings should serve as motivation for companies to improve their talent management efforts. • Forty-one percent higher ratings on creating a pipeline of ready successors. The data clearly shows that moving up to higher Levels of Maturity has a significant impact on talent initiatives and metrics.

organizations have extended the definition to include a broader employee population. which encompasses attracting. Organizations also vary in the processes which they consider to be part of talent management. Madeline Laurano and David Mallon.Talent Management Factbook 2010 12 What Is Talent Management? KEY POINT “Talent management” initially referred to the programs used to manage the “top talent” in an organization. Bersin & Associates / Josh Bersin. May 2010. Although these functions still remain separated in many companies. motivating.bersin. More recently. developing. From an organizational perspective. The phrase “talent management” was coined many years ago and initially referred to the programs used to manage the “top talent” in an organization. “What is talent management?” you are likely to get 10 different answers. measurement approach and systems infrastructure.  For more information. The Talent Management Framework: A Modern Approach for Developing and Mobilizing Talent. an increasing number are integrating these from an organizational and process perspective with other talent functions. If you ask 10 HR leaders. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . We have a fairly broad view of talent management that includes all elements affecting the flow of talent. moving and retaining talent. Talent acquisition and compensation have traditionally been “silos” or separate functions within the organization. which are described in more detail in our report. Stacey Harris. The Talent Management Framework: A Modern Approach for Developing and Mobilizing Talent. Our Talent Management Framework depicts how these different elements come together (see Figure 2) to support that goal.com/library. Let us briefly discuss these areas. Kim Lamoureux. Available to research members at www. it encompasses the governance structure.

” Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . For some companies. high potentials or critical roles that create the most impact on business goals. Often. “talent” is limited to senior leaders. The talent strategy encompasses a number of different components. All rights reserved. these employees are provided with focused development as part of a succession plan and are referred to as “HiPos. 2010. which is how the organization plans to meet its talent challenges and enable its critical talent to support the organization in fulfilling its business goals. Page 1 Talent Strategy Talent management begins with a business-driven talent strategy. for other companies. which is used  A “high-potential employee” is an employee who has been identified as having the potential. ability and aspiration for successive leadership positions within the company. “talent” includes everyone in the organization.Talent Management Factbook 2010 13 Figure 2: Bersin & Associates Talent Management Framework® High-Impact Talent Management Framework Talent Strategy & Business Alignment Workforce Planning Capability & Competency Management Leadership Development Succession Management Career Management Performance Management Learning & Capability Development Talent Infrastructure Business Metrics & Analytics Organization & Governance Talent Acquisition Total Rewards Source: Bersin & Associates. Copyright © 2008 Bersin & Associates. One of the fundamental elements is the talent planning process.

Together with this is the change management strategy. Alignment to the business strategy is also critical for the next area. which addresses how the organization will integrate its talent processes. define their talent segments and analyze organizational skill gaps – both current and future. A second key element is the integration strategy. Workforce Planning KEY POINT In workforce planning. career and succession management. future talent approach. This discipline helps organizations understand the current state of talent. In addition to defining competencies. the majority of companies still conduct workforce planning as a simple headcount analysis for budgeting purposes or on an “as needed” basis.Talent Management Factbook 2010 14 to identify talent challenges and solutions at the enterprise and businessunit levels. and. Capability and Competency Management After talent strategy and workforce planning. Capability and competency management was placed in its current location of the Framework for a very specific reason. such as during a reorganization. It is this information – skills. a company enters the solutions phase of talent management. An effective workforce planning process will consistently help business leaders make informed decisions regarding their talent. define their talent segments and analyze organizational skill gaps – both current and future. Another key component is defining the talent measurement approach which will be used to evaluate the talent strategy and expected outcomes. it is here that organizations will identify critical roles. workforce planning. Although bestpractice companies use workforce planning as an integral part of their business and financial planning. competencies and experiences – that provide the foundational data to support the other talent processes. job profiles should be developed (at a minimum) for all critical roles. forecast talent gaps and take the actions necessary to close these gaps . which should have been defined in the previous area of workforce planning.typically in the form of succession. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . organizations identify critical roles. which is the plan for transitioning from the current state to a desired. and development initiatives. talent acquisition. including development. recruitment. performance management. More than a headcount analysis.

it is at this stage that a new “cycle” begins for an employee. the bench strength of an organization becomes weak and leadership pipelines are truncated – putting the company at significant risk.Talent Management Factbook 2010 15 Talent Acquisition Talent acquisition encompasses identifying.  Through our ongoing research and experiences. utilizing multiple learning modalities. Key elements of a succession management program include talent profiles. talent calibration. Without it. we have developed a definition of leadership development that is broad – but necessarily so. such as when a position becomes vacant as a result of a resignation or dismissal. Leadership Development KEY POINT Without leadership development. coaching and mentoring. assessments. and talent review meetings. The main elements of talent acquisition include sourcing. HiPo identification. and targeting the development of key leadership competencies. or when a position is newly created to meet a business need. assessment and evaluation. job rotations. the bench strength of an organization becomes weak and leadership pipelines are truncated – putting the company at significant risk. The key elements of leadership development include executive education. and a well-designed leadership curriculum that addresses all levels of management. attracting and onboarding talent to fufill the workforce plan and to meet dynamic business needs. knowledge and experiences. and onboarding.  Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . These processes ensure the readiness of talent to move into key positions when necessary. Whether filling positions with internal or external candidates. Succession management is one of the primary ways that a company meets its workforce plan requirements. because of the complexity that leadership development brings. selection. Leadership development prepares talent for future leadership positions. Succession Management Succession management refers to an organization’s processes for selecting and managing talent in order to build organizational bench strength.

Talent Management Factbook 2010 16 Career Management Career management is an employee’s progression through a logical sequence of jobs. businesses need to partner with employees – and foster a collaborative approach to career development that meets the needs of the business. Performance Management KEY POINT When done well. and development planning. skills gap analysis. Today. performance evaluations. It gives people clear direction – building clarity. A key element here is the career plans that employees put in place (with the support of their managers and HR) to develop the skills and capabilities for moving through a desired career path. It is best described as an ongoing process or cycle that takes place throughout the year. Characteristics of a modern career management strategy include promoting job flexibility and fostering talent mobility. When done well. performance management becomes the anchor of an organization’s integrated talent management strategy. Effective performance management is not an isolated annual event focused on an “appraisal” or review meeting. resulting in greater experience or responsibility. Total Rewards Total rewards is an organization’s approach to incenting and rewarding its talent. manage. performance management becomes the anchor of an organization’s integrated talent management strategy. In reality. which is a company’s ability to make talent decisions based on an alignment of employee capabilities and aspirations. assess and develop people. while fulfilling employees’ career aspirations. These key elements of employee performance management include goal setting and alignment. performance management is management. Another component is talent mobility. This is much broader than just compensation elements – it Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . engagement and morale. The progression can be upward (in the form of promotions) and / or lateral. as well as what is best for the business as a whole. alignment. Performance management represents all of the processes that managers use to effectively lead.

benefits packages. and as the workforce needs change. A comprehensive approach to total rewards allows organizations to show the benefits of development. pay for performance approaches. Learning and capability development. was placed toward the bottom of our Talent Management Framework. make decisions to move and develop within the organization. and distribute insights and experiences.) Without learning.  Typical components include rewards and recognition. repeated in this section. designing formal programs and informal approaches to create skills and capabilities within a specific audience.  Fundamental elements of learning and capability development include the defining a learning strategy. work assignments.Talent Management Factbook 2010 17 focuses on a total package that is tailored to the needs of different talent segments. across the entire employee lifecycle. and knowledge management. or what is most commonly referred to as learning and development (L&D). which encompasses a range of practices used to create. a company and its talent become stagnant. represent. Learning and Capability Development KEY POINT Learning and capability development is truly an enabler for talent management strategies. Flexible total-reward approaches allow organizations to incent critical talent to join the organization. It is essential that talent continues to learn and develop as the business evolves and grows. (See Figure 2. and compensation modeling and risk benefit analysis. flexible working environments and other talent-based benefits in employees’ total packages. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . and stay with the organization. because it is truly an enabler for talent management strategies.

and within an organization).  For more information. Copyright © 2008 Bersin & Associates. The High-Impact Learning Organization: WhatWorks® in the Management. All rights reserved.bersin. 2010. and keep critical lines of communication flowing from the business to supporting HR functions. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material .bersin. Available to research members at www.com/ library or for purchase at www. down. Bersin & Associates / Josh Bersin. Page 1 Organization and Governance Considerable thought should be placed into deciding the optimal structures and supporting governance models for an organization’s talent strategy and processes. Governance and Operations of Modern Corporate Training.com/highimpact. communicate plans and needs (both up. as well as build engagement in the process as a whole. These supporting efforts allow the organization to clearly define roles and responsibilities.Talent Management Factbook 2010 18 Figure 2: Bersin & Associates Talent Management Framework® High-Impact Talent Management Framework Talent Strategy & Business Alignment Workforce Planning Capability & Competency Management Leadership Development Succession Management Career Management Performance Management Learning & Capability Development Talent Infrastructure Business Metrics & Analytics Organization & Governance Talent Acquisition Total Rewards Source: Bersin & Associates. The appropriate governance structure allows an organization to make timely decisions concerning critical talent. May 2008.

Integrated talent systems share data across processes and provide reporting and analytics tools to improve alignment. which includes identifying and implementing the critical inputs and outputs between talent processes and tools. and network that must be in place in order for disparate parts to function both individually and collaboratively as one. analyzed and eventually trended. Every area of our Talent Management Framework has its own individual measurement requirements. the data can be monitored for the overall health of critical talent pools and to ascertain whether the talent strategy is meeting its goals. (See Figure 3.) The other key element is the talent systems or software that support the talent processes. Organizations can implement a talent management suite on one platform or integrate separate point solutions to achieve this goal.  This area is the ultimate culmination of an organization’s integrated talent management efforts. systems. allowing leaders to make data-driven decisions on the people aspects of the business. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . planning. The second bookend in our Talent Management Framework includes business metrics and analytics. but a critical final step includes pulling together all the various talent management measurements.Talent Management Factbook 2010 19 Business Metrics and Analytics KEY POINT Process design and mapping includes identifying the critical inputs and outputs between talent processes and tools. Talent Infrastructure Talent infrastructure refers to the processes. One of the elements is process design and mapping. and decision-making on key talent issues. This process mapping effort is the center of an organization’s strategy. Once compiled.

Talent Management Factbook 2010 20 Figure 3: Integrated Talent Management Performance Management Talent Infrastructure Talent Acquisition Competency Management Career Management Succession Management Total Rewards Leadership Development Learning & Capability Development Source: & Associates. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . 2010. Page 1 Copyright © 2008 Bersin & Associates. All Bersin rights reserved.

” and “developing a performance culture. For example. Similarly. an organization must ensure that its talent goals and initiatives are aligned to the business strategy. The following case in point shows how one organization aligns its talent initiatives with its strategic business plan. if cost-containment is a key part of the business strategy. a forestry products company describes its talent strategy as “having the right people with the right skills in the right jobs at the right cost.) The process starts in July with a review of the company’s strategic execution framework. Our research shows that the most effective talent strategies are aligned with the organization’s business strategy. (See Figure 4. with talent initiatives focused on meeting business goals. if increasing customer satisfaction is a key business objective. These statements describe how each organization looks at its talent strategy at a high level. talent management begins by defining a talent strategy. by creating new (nonmonetary) rewards and recognition programs. which lists the goals and initiatives outlined in its three-year strategic plan.K. then new development programs may be needed for customer-facing roles. Behind these strategy statements are a number of talent goals and initiatives. This model is used by the entire Manpower group of companies to ensure alignment and consistency around the corporate vision. Case in Point: Right Management’s Talent Strategy and Planning Model Right Management (the talent and career management consulting arm of Manpower) uses a model to facilitate the organization’s talent strategy and planning process. then this should be addressed in the organization’s talent goals – for example.” KEY POINT When determining how to implement the talent strategy.Talent Management Factbook 2010 21 Talent Strategy and Planning As mentioned in the preceding section.” The HR executive at the Manchester Airport in the U. says its talent strategy revolves around both “attracting and retaining great people. These business objectives are divided into five main sections: Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . For example. which can be articulated in different ways.

This way. Business development. 2. Thought leadership. Organization and culture. deploying a new model for high potentials. they can then define specific talent goals and initiatives that will become their “talent commitments” for the year. Revenue. e Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . KEY POINT Based on its three-year strategic plan. the model is used to communicate the objectives and commitments throughout the organization.Talent Management Factbook 2010 Case in Point: Right Management’s Talent Strategy and Planning Model (cont’d) 22 1. From this strategic execution framework. and . 4. and creating an action plan for improving diversity. Skills. expanding succession planning to the next level down in the organization. and. 5. 3. Once the team members understand how the business objectives will impact the organization’s talent. 4. the HR team can discuss the implications of the business objectives on the organization’s talent. Organization. which are organized into four categories: 1. the HR team can then discuss the implications on talent strategy and planning. 3. Mindsets. These may include initiatives such as communicating and engaging employees in the company’s new strategy. The model has also proven to be an effective communications tool in helping staff members understand and work toward their objectives. 2. The model has been extremely successful in ensuring that talent initiatives are aligned with business objectives. and how these support the business strategy. Once the talent commitments have been determined. Profitability. Leadership. the HR staff understands what goals and deliverables are expected.

) Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . Another 38 percent of companies are still in the “novice” stage in which they have just started to define their talent strategies. have declined over the past two years. as companies have matured their strategies.Talent Management Factbook 2010 23 Figure 4: Right Management’s Talent Planning Framework Example: Talent Planning Framework Talent Commitments Right Management Key TYSP / Local SEF Objectives Revenue Business Development Profitability Thought Leadership Organization & Culture Key Talent / Organization Implications Mindset Mindset Leadership Leadership Organization Skills Key Talent / Organization Actions and Commitments TYSP = Three-Year Strategic Plan SEF = Strategic Execution Framework Source: Right Management. Right Management is a great example of a company with a mature process for talent strategy and planning. very few do. (See Figure 5. In our study. 2010. while substantial. These numbers. Not every company has such a process – in fact. 16 percent of companies reported that they have not yet developed a talent strategy.

2008 to 2010* 2010 7% 39% 38% 16% 2009 5% 38% 40% 17% 2008 5% 32% 37% 25% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Advanced Intermediate Novice No Talent Management strategy *Numbers may not total 100% due to rounding. with mature strategies and wellintegrated talent processes in place. Comparing industries. the more mature the strategy and its implementation.) Conversely. the banking / finance and technology sectors are generally more advanced than other industries.S. companies are making progress in implementing their talent strategies. the larger the company. while there is still a lot of room for growth.S. Today. companies are making progress. The number of companies in these two stages has grown over the past two years. So. in which they are implementing their strategies and have some integrated talent processes in place. Source: Bersin & Associates. but that is starting to change. 2010. Seven percent of organizations have now reached the advanced stage. Figure 5: Talent Management Strategy – U. One in 10 large enterprises describes its talent strategy as “advanced” and fully one-half say they are in the “intermediate” stage. government and healthcare organizations have the least mature talent strategies. nearly 40 percent of companies say they are in the “intermediate” stage.Talent Management Factbook 2010 24 KEY POINT U. (See Figure 6. These two latter sectors have traditionally Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . We find large companies that have survived many business cycles have learned how to evolve and adapt their talent management initiatives along the way. KEY POINT Government and healthcare organizations have the least mature talent strategies. Company size makes a difference – generally speaking.

opm. 2010* Large (10.999 employees) 6% 43% 40% 11% Small (100 . an increasing number of hospitals are following the model of the Mayo Clinic. 2010.000+ employees) 11% 50% 30% 9% Midsize (1. This trend is elevating the need for more mature talent management practices in this sector.Talent Management Factbook 2010 25 lacked sophistication regarding HR and talent issues – but that is changing.pdf.999 employees) 6% 33% 40% 22% 0% 20% 40% 60% 80% 100% Advanced *Numbers may not total 100% due to rounding.9. in which doctors are hospital employees rather than independent contractors. and the work has just begun.S.gov/strategicplan/StrategicPlan_20100310.000 .  Source: http://www. Intermediate Novice No Talent Management Strategy Source: Bersin & Associates. Figure 6: Talent Management Strategy by Company Size – U. The new leadership at the Office of Personnel Management (OPM) has brought significant changes to federal personnel policies and practices. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . The OPM’s future plans promise to revolutionize the way government agencies hire. develop and manage their workforces. Talent management is also changing in the government sector. For example.

For other companies. Who Is Considered “Talent?” KEY POINT Technology companies. for example. and special compensation and rewards programs. a critical role in the company that touches every client and internal employee. 2010* Banking Technology 9% 11% 8% 8% 52% 50% 42% 41% 31% 31% 38% 41% 9% 8% 13% 9% Manufacturing Business Services / Consulting Insurance Retail 7% 7% 41% 38% 54% 55% 5% 7% Healthcare / Medical 3% 38% 21% 10% 20% 30% 40% 46% 48% 50% 60% 70% 80% 13% 27% 90% 100% Government 4% 0% Advanced *Numbers may not total 100% due to rounding. Intermediate Novice No Talent Management Strategy *Numbers may not total 100% due to rounding. Source: Bersin & Associates. For some companies. For example. 2010. An important piece of talent management is defining “talent” – a definition that will determine which employees or talent segments to include in certain talent initiatives. may identify critical engineering roles for career development and special rewards programs. talent initiatives are targeted to certain job levels. Many companies target their leadership teams for specific development programs and succession planning efforts. critical roles or talent segments. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . This includes the company’s receptionist.Talent Management Factbook 2010 26 Figure 7: Talent Management Strategy by Industry – U. Technology companies may identify critical engineering roles for career development. talent includes everyone. an HR executive at a small Southeastern insurance company noted that every one of its 170 employees is included in talent initiatives – from L&D to succession planning.S.

tenure and many other factors. identifying individual contributors who have the potential to become a first-level manager or identifying junior engineers who have the potential to become senior engineers. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . At the same time. talent initiatives are tailored to specific segments. Many companies take a hybrid approach. ethnicity. gender.Talent Management Factbook 2010 27 These talent segments are determined during the workforce planning process and are used to tailor many talent initiatives. In addition. L&D programs cover the entire global workforce. with some companies segmenting employees by job level. such as succession planning. talent reviews and specific leadership development initiatives. criticality of role. ethnicity. career management. KEY POINT Talent segments may be based on job level. experience and assessments for the top three management tiers as part of its enterprise talent review process. which are the focus of targeted talent management activities. union membership or exemption status. March 23.com/library. talent segments vary widely. Most organizations we interviewed said that they identify high potentials as a talent segment requiring tailored programs. retail banking positions and has also created special development programs for different ethnic groups. Bersin & Associates / Stacey Harris. In this way.  “Talent pools” are groups of employees identified for a specific leadership level or type of role – for example. such as development. for example.bersin. potential.  For more information. As an example. Talent Segmentation within Your Company’s Talent Strategy. including top leaders and high-potential engineers.S. Available to research members at www. Beyond that. tenure. the company tailors its recruiting efforts for high-volume. At Qualcomm. a large U. since diversity is a key initiative within the company. bank collects information on skills. 2010. the company has identified critical talent pools. succession planning and compensation. in which some talent activities are offered enterprisewide and others are targeted to specific talent segments.

companies have a dedicated talent management role.S.) Government. more than one-half of large enterprises have a dedicated talent management role. “Appendix I: Study Methodology. in part. these positions do not always have the words “talent management” in their titles. healthcare and manufacturing firms are least likely to have this role. In fact.” for more information. See section.) This executive can help by aligning priorities and focusing resources toward talent goals. and communicate plans and goals up. An ineffective structure causes talent initiatives to be disjointed and disconnected.Talent Management Factbook 2010 28 Organization and Governance The choice of an organizational structure and governance model for talent management is important to the success of talent initiatives. 30 percent of U. These supporting structures allow the organization to clearly define roles and responsibilities. Among industries. Although titles of “director of talent management” and “vice president of talent management” are becoming more common. and keep lines of communication flowing. For these reasons. technology and financial services firms are more likely to have a dedicated talent management executive. to the over-weighting of large retailers in our sample. Today.S. this figure is up from 21 percent in 2008. An effective governance model allows the organization to make timely decisions concerning critical talent. (See Figure 8. it may be a vice president or director of HR who is the dedicated talent management role within the organization. (The high figure for retail may be due.S. up from 21 percent in 2008. companies have a dedicated talent management role. But more small and midsize companies are also putting in place talent management executives. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . Large organizations are far more likely to have a dedicated talent management role than small and midsize companies. down and across an organization. more companies are appointing a dedicated talent management executive to manage some or all of their talent functions. KEY POINT Today. 30 percent of U. For example.. retail. particularly in the U.

S. 2010 Small (100 . 2010.S. Figure 9: Presence of Dedicated Talent Management Executive by Company Size – U. Figure 10: Percent of Organizations with a Dedicated Talent Management Executive by Industry – U.Talent Management Factbook 2010 29 Figure 8: Percent of Organizations with a Dedicated Talent Management Executive – U. 2010.000 .9. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material .000+ employees) 0% 10% 17% 38% 58% 20% 30% 40% 50% 60% 70% 80% 90% 100% Source: Bersin & Associates.999 employees) Midsize (1. Total 2008 to 2010 2010 2009 2008 0% 10% 20% 30% 28% 21% 30% 40% 50% 60% 70% 80% 90% 100% Source: Bersin & Associates. 2010 Retail Technology 59% 42% Banking Insurance Business Services / Consulting 41% 41% 33% Manufacturing Government (Federal / State / Local) 31% 27% Healthcare / Medical 0% 10% 20% 23% 30% 40% 50% 60% 70% 80% 90% 100% Source: Bersin & Associates.S.999 employees) Large (10. 2010.

this role is responsible for the talent strategy. Workforce planning is also typically under the charge of a separate person or group. succession management. 2010 Talent strategy Leadership development Succession management Learning & development Performance management Career management Competency management Recruiting Workforce planning Compensation 0% 10% 20% 78% 73% 72% 62% 62% 56% 54% 54% 39% 21% 30% 40% 50% 60% 70% 80% 90% 100% Source: Bersin & Associates. workforce planning is partnered with recruiting. performance management. which often reports up through a different chain of command into the central HR organization. and learning and development. and driven by local managers or departments. recruiting is under the purview of the talent management executive. Figure 11: Functions for Which the Talent Management Executive Is Responsible (among companies that have a dedicated executive) – U. In some cases. talent management executives do not typically own the compensation / rewards function. Recruiting also is split – in just more than one-half of the cases. recruiting is a separate function.Talent Management Factbook 2010 30 KEY POINT Today. In most companies. The responsibilities of talent management executives vary widely. nor the workforce planning process.S. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . as part of the annual budgeting cycle. or under the direction of a strategic HR staff person. or into the regional structures within global enterprises. often reporting into the business units. leadership development. the other half of the time. Other times. since many companies think of workforce planning solely in terms of headcount needs. The talent management executive does not typically own the compensation / total rewards function.) Just more than one-half of the talent management executives are responsible for career management and competency management initiatives. 2010. (See Figure 11. this activity is owned by business leaders and finance.

because the talent functions work collaboratively with each other and with the business-unit leaders to bring a cohesive. All three directors report into the assistant vice president of HR. performance management. the talent management executive needs to be actively engaged in all talent management activities. At the same organizational level is a director of learning strategy who is responsible for leadership development. soft skills and technical skills training. a senior-level position two levels down from the company’s president and CEO. since all talent functions are under one organization. (See Figure 12. If the talent functions are not under one central authority. then they must at least work cooperatively to bring an integrated and systematic approach to talent management across the organization. Case in Point: Business Development Bank of Canada At the Business Development Bank of Canada (BDC). however.) Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . career management. succession planning.Talent Management Factbook 2010 31 To be fully effective. They are all effective. KEY POINT The organizational structure at BDC promotes communication and coordination across the talent processes. as well as a director of total rewards who is responsible for compensation and rewards. Each is different in terms of the reporting structure and responsibilities of the talent management executive. business-driven approach to talent management. the director of talent management is responsible for talent acquisition. employee engagement and employer branding. The following cases in point describe a few examples of organizational structures for talent management.

2010. Advisor. Organ. Advisor. Talent Retention Mgr. Advisor. Effectiveness Coordinator Coordinator Source: Business Development Bank of Canada.Talent Management Factbook 2010 Case in Point: Business Development Bank of Canada (cont’d) Figure 12: 5 Regional HR Business Partners + Head Office 32 President / CEO SVP of HR AVP of HR 5 Regional HR Business Partners + Head Office Dir of Talent Mgmt Dir of Org Design Dir of Total Rewards Dir of Learning Strategy 1 Direct Report 9 Direct Reports Advisor. Technical Skills Advisor. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . Workforce Initiatives Sr. Soft Skills & Leadership Dev. Talent Attraction Sr.

The regional HR business partners also work closely with the regional leadership teams. Overall. the director of talent management conducted focus groups in collaboration with the HR business partners to validate the right behaviors associated with the competencies. As a result. the HR staff encourages business leaders to deliver the message. learning strategy and talent management in the design and implementation of processes and solutions in the regions. led by the regional HR business partner and senior business leader. with some flexibility for tailoring to individual business needs. The committee reviews and calibrates employee assessments for fairness and consistency. there is a partnership between HR as the facilitators and business leaders as the owners of talent management. This role provides strategic organization design and job evaluation advice to senior management in support of the company’s business needs. regional performance management committees meet annually. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . wherein the business leader and HR business partner in each region meet to identify and discuss pools of succession candidates. Finally.Talent Management Factbook 2010 Case in Point: Business Development Bank of Canada (cont’d) 33 A peer to the assistant vice president of HR is the director of organizational design. For example. e KEY POINT In communications to employees. since all talent functions are under one organization. This underscores the notion that talent management belongs to the organization – it is not just an HR issue. the organizational structure at BDC promotes communication and coordination across the talent processes. Whenever there is a communication to employees. the HR staff encourages business leaders to deliver the message –underscoring the notion that talent management belongs to the organization. in a recent review of the organization’s competency models. A similar process is followed for succession planning. For example. The structure also promotes a healthy relationship between the centralized talent functions and the regional HR business partners. The regional HR business partners work closely with the teams of total rewards. there is a high degree of consistency of talent processes across regions.

2010. a global HR function handles performance management and succession planning.400 employees. Performance Source: Financial Services Company. HR Operations Senior Manager. For executives.Talent Management Factbook 2010 34 Case in Point: Talent Management Structure at a Financial Services Company A U. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material .S. Compensation Senior Manager. Talent Management Manager. The company segments its talent management activities for executives and non-executives. A separate organization (see Figure 13) manages talent activities for non-executives. with primary operations in North America and Latin America. Figure 13: Talent Management Structure at Financial Services Company VP of HR Senior Manager.-based financial services company has 1. Talent Acquisition 1 Direct Report Supervisor. Skills Development 6 Direct Reports Supervisor. Latin America Manager. Leadership Development 2 Direct Reports Supervisor. HR Operations Supervisor.

Talent Management Factbook 2010 Case in Point: Talent Management Structure at a Financial Services Company (cont’d) 35 This organizational structure is very fluid. Employees and managers at all levels are encouraged to pursue coaching. Figure 14: Relationships between Talent Processes Talent Acquisition Skill Development Ldr / Mgr Development eNeRGy (NetworkRotate-Grow) Performance Source: Financial Services Company. the organization recently launched a new skills development program for credit analysts and discounters. The eNeRGy initiative (which stands for “Network. and the talent acquisition supervisor for her knowledge of participant skills and profiles from the screening and recruiting process. in reality staff members work on many projects cross-functionally. e KEY POINT A special leadership program for recent MBA graduates. The two-year program includes strategic. high-profile projects designed to develop participants for management roles within the company. then developing skills and leadership qualities. This type of cross-functional collaboration brings a broader perspective to the project.” “Rotate” and “Grow”) is a special leadership program for recent MBA graduates. Both of these individuals were uniquely qualified to contribute to the project – the skills development supervisor for her knowledge of instructional design and learning principles. the eNeRGy initiative is a two-year program designed to develop participants for management roles within the company. For example. underscoring the point that every talent process affects and supports the other processes. Figure 14 shows the organization’s perspective on the interrelationships of talent processes and how these ultimately impact performance. Two staff members worked together to design and deliver the program – one from skills development and the other from the talent acquisition function. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . The result is a high-performance organization. Although people are assigned to specific talent management roles (such as talent acquisition and skills development). cross-functional projects and other development opportunities. The process starts with acquiring talent.

and the vice president of McDonald’s global talent management and Leadership Institute. the crux of the company’s talent management efforts. talent processes (such as recruiting and performance management) are handled at the local level. The corporate group creates the global compensation philosophy. For directors and above. Recruiting is driven primarily at the country and local levels – with restaurant employees recruited externally through local sources. which has responsibility for creating frameworks. For restaurant managers and employees. and then tailor compensation packages for their organizations. a corporate organization drives talent initiatives. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . strategy and frameworks for mid-level managers through executives. Compensation and benefits are managed at two levels. The regional (“area of the world”) and local HR teams benchmark and complete compensation analyses. • Succession planning. processes and practices for the following areas: • Strategic workforce planning. and mid-level and more senior positions filled through succession and targeted external executive search efforts. The corporate team is led by an executive vice president of HR (see Figure 15). • Career management. with implementation of these initiatives conducted by regional teams. McDonald’s segments its talent management activities by job level. • Performance and competency management. The work of the Leadership Institute is closely integrated with that of global talent management. Two other talent processes. are outside the purview of the global talent management team. • Assessment and selection for senior leaders. Reporting into this role are a senior vice president of international and corporate HR.Talent Management Factbook 2010 36 Case in Point: McDonald’s Like the preceding example. recruiting and compensation. The Leadership Institute designs global development and transition programs for directors and above. a vice president of benefits and compensation. and.

best practices and benchmarks. The processes must be flexible enough to be tailored by each area of the world or country to meet their needs. Although it can take considerable time to roll out a process globally. the global group sponsors a talent management advisory board. e Figure 15: McDonald’s Talent Management Structure Corporate Structure Exec VP of HR Area of World (AOW) Structure AOW President Sr VP. International & Corporate HR VP. 2010. Global Talent Mgmt & Leadership Institute SVP (or VP) of HR AOW Sr Dir. Leadership Institute Sr Dir. a company with decentralized decision-making. The phrase “freedom within a framework” is often used at McDonald’s to describe how the corporate team works with the areas of the world to drive the right balance between a centralized strategy and decentralized execution. The global talent management organization operates as a center of excellence. Benefits & Compensation VP. The team collaborates with the areas of the world to create frameworks and processes. Global Talent Mgmt Sr Dir (or Dir) of Talent Mgmt HR Business Partner(s) or Field Implementation Leader(s) Sr Dir (or Dir) of Benefits & Compensation 5 Direct Reports 4 Direct Reports Source: McDonald’s. The advisory board helps forecast officer-level openings and discusses the potential movement of talent across areas of the world. pilot these for effectiveness.Talent Management Factbook 2010 Case in Point: McDonald’s (cont’d) 37 In addition. comprised of HR and talent management leaders from each area of the world. This governance structure has proven to be effective at McDonald’s. and then consult on the implementation. the result is a more business-driven solution that is embraced at the local level. keeping abreast of trends. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material .

outsourcing some of these functions. Other companies stressed the need to find a talent management executive who is influential.” Finding the right people to lead and implement an organization’s talent management efforts is essential. A talent management executive can act as a tremendous change agent for the organization and. the company eliminated the administrative tasks from these roles.S. organizations rated their HR staff as just “fair” or “poor” on basic business acumen. These skills go beyond the typical profile of an HR generalist or specialist. It appears that. This is one of the keys to connecting HR with the businesses. look for someone who “when he or she talks. The executive vice president global HR was formerly the firm’s general manager in France. (See Figure 16. as one company put it. “… When he or she talks. due to be published H2’2010. companies are looking for business-savvy talent management professionals. One of our recent studies found that 42 percent of U. people listen.Talent Management Factbook 2010 38 The Right Mix of Skills KEY POINT When selecting a talent management executive. The person needs to be someone who. Its HR leader in Asia formerly held a post in marketing. Increasingly. Based on this analysis.) These organizations will need to hire for these positions or develop their current HR staff in order to move their talent management strategies forward.com/hihr.” Good communication and leadership skills are key ingredients here. please visit www. Some organizations may need to redefine their existing HR roles in terms of the necessary skills sets and job descriptions. High-Impact HR Organization. If there is a disconnect between HR and the business. can drive the strategy and processes forward. its head of HR in Europe has a consulting background. HR staff do not understand the business and nor do they have good persuasive skills. the majority of HR executives at Right Management come from a business background. within many companies. since an understanding of business issues and challenges is critical. A FORTUNE 500 manufacturing company set about this task by taking an inventory of the work being done by its HR generalists. to  For more information on our upcoming research. and 31 percent rated the HR staff as “fair” or “poor” on presentation and communications skills. the company believes it is because HR people do not understand the business. such as payroll and benefits. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . Similarly. with a strong team in place. For example.bersin. people listen.

a top business executive needs to be actively engaged in the strategy. due to be published in H2’2010. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material .com/hihr. Available to research members at www. and. and. so that these personnel could provide more strategic consulting and solutions to the businesses.com/library or for purchase at www.com/highimpact.bersin. • Implementing tools. Our research shows that the most effective talent strategies are owned and driven by business leaders and managers. May 2008.11 The HR or talent management executive plays the important role of steward for the talent strategy efforts by: • Ensuring foundational structures are in place. due to be published H2’2010.S. Business Ownership of Talent Management KEY POINT For talent management to be successful.bersin. High-Impact HR Organization. 2010*10 Basic business acumen 8% 48% 33% 9% Presentations. based on business goals. please visit www. third parties. 10 For more information on our upcoming research. please see these two reports: (1) The High-Impact Learning Organization: WhatWorks® in the Management. Governance and Operations of Modern Corporate Training. 11 For more information. 2010.bersin. speaking. The HR generalist roles were redefined solely as business partners.Talent Management Factbook 2010 39 Figure 16: HR Proficiency Ratings – U. Good Fair Poor Source: Bersin & Associates.bersin. Bersin & Associates / Josh Bersin. please visit www. processes and systems that enable the business to manage talent effectively. • Assigning appropriate supporting resources. com/hihr. (2) High-Impact HR Organization. communications 13% 55% 27% 4% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% World class *Numbers may not total 100% due to rounding.

Success ultimately depends on the extent to which business leaders adopt talent management processes and accept responsibility for the results. (See Figure 17.000+ Employees) 0% 10% 20% 30% 40% 50% 60% 70% 73% 67% 65% 70% 80% 90% 100% Source: Bersin & Associates. Total Small (100-999 Employees) Midsize (1. 2010 Manufacturing 82% 74% 72% 71% 67% 62% 61% 32% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Retail Healthcare / Medical Insurance Banking Business Services/ Consulting Technology Government (federal.S. Figure 18: Top Business Executive Drives or Actively Participates in Talent Management Strategy by Industry (among companies that have a strategy) – U. including attracting.000-9. Therefore. 2010 U.S.999 Employees) Large (10.Talent Management Factbook 2010 40 Business leaders and managers must take ownership of talent initiatives. 2010. state.) Without the active support and participation by a top business executive. local) Source: Bersin & Associates. engaging and retaining people. in order for talent management to be successful. developing. a top business executive needs to be actively engaged in the strategy. companies will likely struggle in their talent management initiatives.S. The good news is that 70 percent of companies have a business executive actively participating in their talent strategy. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . Figure 17: Top Business Executive Drives or Actively Participates in Talent Management Strategy by Total and by Company Size (among companies that have a strategy) – U. 2010.

com/library. We briefly describe these stages in the following sections12. 2010. as depicted in Figure 1 (repeated in this section). Bersin & Associates / Karen O’Leonard and Stacey Harris. may have systems in place but not connected Level 1: Siloed HR Processes 28% Source: Bersin & Associates. Available to research members at www. with some integration. 2010. please see Bersin & Associates Talent Management Maturity Model®. single person / team responsible for talent initiatives Level 3: Integrated Talent Management 20% Talent processes are consistent and tailorable. talent mgmt. It also requires business leaders and managers to take ownership of talent initiatives – and to be held accountable for talent outcomes.bersin. several systems connected through manual processes Level 2: Standardized Talent Processes 45% Individual HR processes or “silos”. integrated talent processes. progressing through a series of stages. is business-driven Level 4: Strategic Talent Management 7% Heavy focus on connecting systems and processes. a business-driven talent strategy and highly evolved. Figure 1: Bersin & Associates Talent Management Maturity Model® Fully integrated processes and systems used to make business decisions. August.  This Level of Maturity does not happen overnight.Talent Management Factbook 2010 41 Talent Management Maturity Mature talent management calls for an effective governance structure. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . 12 For a more detailed description of this Maturity Model. Organizations typically evolve to this Level over a number of years.

” meaning that there is little or no coordination across processes.) Maturity also varies by industry. At the most sophisticated stage (Level 4). in which most processes are silos and systems are not connected. taking data by hand from one system and entering it into another system). Level 3. The processes are “silos. organizations have fully integrated systems and processes. with 43 percent of organizations still in Level 1. with a set of consistent talent processes that are in the early stages of integration. (See Figure 19. HR owns the talent management initiatives and seeks input from business leaders. Level 1 describes a traditional HR organization in which talent processes are developed and managed individually across business units or functions. That is one reason why large companies. who are held accountable and rewarded for talent outcomes. In the next stage. A far greater number of small companies.Talent Management Factbook 2010 42 KEY POINT Today. with 35 percent still at Level 1. advancing through these stages takes time. by contrast. nearly one-half of U. but talent management is owned by business leaders and line managers. as well as resources – one reason why large companies generally are more mature. such as an LMS (learning management system) or an applicant tracking system – but these systems do not share data. the organization develops a set of consistent talent processes that can be tailored as needed to meet business-unit and regional needs.e.. A talent management executive serves as the steward of the strategy and processes. are in the early stages of maturity. KEY POINT Advancing through the maturity stages takes time. Talent management is part of the annual business planning process. organizations are heavily focused on integrating talent processes and systems. In these organizations. are more mature. Just more than one-third of large companies have advanced to Level 3 or 4.S. The government sector is the least mature. companies are at Level 2. A talent management executive or team is responsible for talent initiatives. with nearly one-half of all organizations at this stage of maturity. As mentioned above. in general. integrated talent Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . the organization begins to identify connection points across its talent processes and to manually link its talent systems (i. This is the largest category today. In addition. In Level 2. The organization may have automated talent systems in place. Banking / financial services firms have the most mature. but business leaders share equal responsibility for achieving talent goals. as well as resources. Individual talent processes are highly evolved and priorities are set based on talent planning outcomes. so that talent initiatives are aligned with business objectives. Strategic workforce planning is used to set priorities and talent data helps to drive business decisions.

2010* Small Midsize 8% 7% 8% 7% 0% 14% 23% 28% 20% 10% 20% 30% 43% 48% 47% 45% 40% 50% 60% 70% 35% 23% 17% 28% 80% 90% 100% Large U. companies in the technology. The one exception is the government sector. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . The reason is that organizations in this sector are still focused on creating a talent strategy. the sector may look more sophisticated than it is in the real marketplace. Figure 19: Talent Management Maturity by Company Size – U. (See section. which is a precursor to integrating processes. 2010. Source: Bersin & Associates.Talent Management Factbook 2010 43  anagement initiatives. Nearly one in five companies reported that integrating its talent processes is a “high priority. banking / financial services and retail sector are focused on integrating their processes.S. “Appendix I: Study Methodology” for more details. then these organizations can look at the integration piece. but since the retailers in our study were predominantly large firms. Many retailers in our study also had mature m practices.) We expect organizations to continue to evolve their talent management practices as they emerge from the recession and refocus on long-term planning. in which very few organizations said that integration was a high priority.” (See Figure 21.S. 2010 Level 4: Strategic Talent Management Level 3: Integrated Talent Management Level 2: Standardized Talent Processes Level 1: Siloed HR Processes *Numbers may not total 100% due to rounding.) In particular. Once the strategy is defined.

local) 0% 16% 0% 100% Level 4: Strategic Talent Management Level 3: Integrated Talent Management Level 2: Standardized Talent Processes Level 1: Siloed HR Processes *Numbers may not total 100% due to rounding.000 .S. 2010. Total Small (100 . Source: Bersin & Associates.Talent Management Factbook 2010 44 Figure 20: Talent Management Maturity by Industry – U. 2010* Banking 8% 8% 30% 24% 43% 48% 22% 20% Retail Technology Manufacturing 14% 10% 7% 9% 21% 19% 51% 43% 48% 26% 26% 28% Insurance Healthcare / Medical 6% 19% 14% 41% 20% 40% 48% 53% 43% 60% 80% 28% 28% Business Services / Consulting 5% Government (federal.000+ employees) 0% 10% 20% 28% 30% 40% 50% 60% 70% 80% 90% 100% Percent saying “a high priority” Source: Bersin & Associates. 2010. state.S. 2010 U. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material .999 employees) Large (10.999 employees) 19% 14% 21% Midsize (1. Figure 21: Priority to Integrate Your Talent Processes by Total and by Company Size – U.9.S.

support and advice via ongoing discussions throughout the year. the company has well-integrated and effective talent processes.Talent Management Factbook 2010 45 Figure 22: Priority to Integrate Your Talent Processes by Industry – U.S. follow-through and managing their own career aspirations. which is formally conducted in the fall of each year. 2010 Technology Banking 32% 30% Retail Insurance 28% 21% Manufacturing Healthcare / Medical 21% 19% Business Services / Consulting Government (federal. Managers provide feedback. as described in the following case in point. The linchpin is the company’s career management process. talent initiatives are closely interwoven. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . The Business Development Bank of Canada is one company that has made talent management a high priority over the past several years. local) 0% 14% 2% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Percent saying "a high priority" Source: Bersin & Associates. 2010. state. As a result. During this time. Employees are responsible and accountable for development plan creation. employees discuss their career aspirations with their managers and then create a development plan based on these goals. Case in Point: Talent Management Integration at BDC At the Business Development Bank of Canada (BDC).

If the employee is a high performer. The succession plan is reviewed annually and presented to BDC’s board of directors. These discussions focus on employee interests and plans going forward. managers have special conversations with employees who are eligible to retire within next three years. Development plans are put in place for all succession candidates and are linked to L&D opportunities. • Leadership. Another key component of the career management process is identifying high potentials. and how his / her knowledge can be transferred. the manager explores options for retention. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . which include all positions at the vice president-level and above. and • Results (based on qualitative or quantitative objectives). 46 During the career management process. These individuals will become part of the discussion during the succession management process. All employees are evaluated on a defined set of competencies. the career management process includes special conversations with employees who are eligible to retire in the next three years. A group of senior business and HR leaders identify successors for critical positions.Talent Management Factbook 2010 Case in Point: Talent Management Integration at BDC (cont’d) KEY POINT At BDC. at which time the regional business lead and HR business partner review candidates for potential promotion to first-line manager roles. These plans (along with the development plans created by employees as part of the career management discussions) are reviewed formally at midyear and year-end as part of the performance management process.  The succession management process also targets higher-level positions. as well as in three key responsibilities areas: • Client. The names of the targeted employees are then provided to L&D to schedule these individuals for the Transitional Leadership course. plus some targeted functional positions.

and mobile upwardly and laterally throughout the organization. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . Objectives Weighted average of ratings Compensation Merit increase Bonuses Source: Business Development Bank of Canada. These processes work together to ensure that talent is engaged. All of these activities are part of BDC’s talent management cycle and are closely integrated.Talent Management Factbook 2010 Case in Point: Talent Management Integration at BDC (cont’d) 47 The evaluation on the third piece. results.) e  Figure 23: Business Development Bank of Canada’s Integrated Talent Processes Career Management Career planning Retirement planning HIPO identification Development Plans Plan for knowledge transfer Names of HIPOs Succession Management HIPO selected Successors ID’ed Board approval Development Plans Learning and Development HIPO enrolled Skills gaps targeted Transitional Leadership program Formal and informal programs Performance Management Mid-year review Annual appraisal Rating on Results vs. (See Figure 23. The employee’s overall rating is used to calculate his / her merit increase. 2010. is used to calculate variable pay. high performing.

created in the performance management process. • Establish the criteria for evaluating performance and identifying high potentials. and. Our research found that competencies were the most common integration point across processes. there appears to be one common starting point – competencies. • Assess the skills needed to build L&D programs. These functions have a natural synergy. Competencies are used in many ways. For example. From a higher-level perspective. The next step for many companies is to integrate their performance management and L&D processes. competencies serve as the foundation for other talent processes. Just more than 40 percent of organizations reported that their performance management and L&D processes are consistently linked in these ways. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . (See Figure 24. “Where should we focus our efforts?” Although our research found that organizations may take many different paths to integrate their processes (all of which can be successful).Talent Management Factbook 2010 48 The Path to Integration When trying to advance their talent management initiatives. organizations quickly realize that many of their design decisions are dependent on a set of defined competencies. and career and succession management initiatives. companies often ask.) These same competency models can then be leveraged for learning and development. L&D leaders should regularly review skills gaps across the employee base and create new development programs to fill these gaps. When developing a talent management strategy. Therefore. can be linked to recommended L&D programs. to: • Codify the job requirements used to recruit the right candidates. For example. leadership development. nearly two-thirds of companies reported that they use standard competency models to recruit candidates and to assess employees in performance evaluations. employee development plans.  KEY POINT Competencies are the foundation for talent processes.

as well. time off and special projects).. compensation / rewards and succession planning) should be tailored for these segments. they may include nurses and clinical staff. As mentioned earlier (see section.Talent Management Factbook 2010 49 Figure 24: Connections between Talent Processes – U. 2010. Many companies tie bonuses or annual merit increases to employee performance evaluations. 2010 Standard competencies used for recruiting and performance evaluations L&D programs created to target critical skills gaps Employee development plans tied to recommended L&D programs Compensation / rewards differentiated for HiPos Talent planning identifies critical talent based on business goals Succession planning used to prioritize leadership program participants 0% 10% 20% 30% 62% 45% 42% 40% 36% 34% 40% 50% 60% 70% 80% 90% 100% Percent saying "in most cases / companywide standard" Source: Bersin & Associates. however. critical talent segments may include senior engineers. Only 36 percent of organizations. the connection is spotty.” These high potentials should be targeted for tailored compensation packages. For high tech companies. since many initiatives (such as development. but there are other critical segments. “Who is Considered ‘Talent?’”).g. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . for healthcare organizations. Another area of natural synergy is between performance management and compensation. just 40 percent of organizations provide special rewards and incentives for employees identified as “high potentials. talent segmentation is a vital part of the workforce planning process. Beyond that. recognition. identify critical talent segments based on their business goals.or long-term monetary and non-monetary rewards (e.  KEY POINT Linking performance management and L&D is a key factor in helping employees meet their performance goals.S. High potentials are one of the talent segments typically identified during the workforce or talent planning process. which can include short. For example.

The processes for performance management and succession management were standardized across the company. One of the outcomes of succession planning is targeted development plans for identified successors. as well as incorporating competencies and goal-alignment. The impetus for the change came from two sources.” Although companies tend to follow different paths in integrating their talent initiatives. In 2008.S. which advocated for improving the performance management process. the company’s talent management approach began to evolve. a midsize U. just one-third of organizations have this level of coordination between the two processes. which should then be linked to the organization’s leadership development programs. Case in Point: Path to Integrated Talent Management KEY POINT The HR team recognized that performance management needed to be more user-friendly for managers and more accessible to employees. Without it. manufacturing company followed a somewhat traditional approach to talent management. however. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . Today. with independent HR programs and processes. The process also needed to incorporate competencies and goal-alignment. Based in part on feedback from the employee engagement survey. the following case in point shows how one company began its journey to more mature and effective talent management. our study measured one other area of integration – succession planning and leadership development.Talent Management Factbook 2010 50 KEY POINT One of the outcomes of succession planning is targeted development plans for identified successors. and were lacking in standards and consistency. many more possible ways to integrate these processes. These are some of the typical connection points across talent processes – there are many. Finally. Some functions (such as recruiting and L&D) were driven primarily by individual business units. One was driven by HR. giving priority to the identified successors for inclusion in the programs. but needed better coordination and linkage to other talent processes. Key linkages between processes are shown in “Appendix II: Key Talent Integration Points across Talent Processes. identified successors may not get the development they need to ensure readiness to take on their next roles. the HR team recognized that performance management needed to be more user-friendly for managers and more accessible to employees. These development plans should then be linked to the organization’s leadership development programs. For many years.

Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . An L&D taskforce (comprised of leaders from across the company) was chartered to develop a new. the taskforce recognized the need for a more effective organization structure. The other catalyst for change. KEY POINT Two competency models were developed for use in performance evaluations – one set of competencies for individual contributors and another one for people leaders. the L&D organizational structure was defined and new companywide learning programs were underway. the programs also needed to incorporate the core competencies used in the performance management process. the company acquired a performance management system in late 2008. and empowers business and functional units to run their own training programs. two competency models were developed for use in performance evaluations – one set of competencies for individual contributors and another one for people leaders.  13 A “federated model” has a small core team that manages some technology and corporate programs. while additional L&D resources would exist within the business units to support training specific to their needs. At that time. Besides targeting certain skills. the performance management process was revamped to accommodate midyear reviews.Talent Management Factbook 2010 Case in Point: Path to Integrated Talent Management (cont’d) 51 Initially. focused on learning and development. initiated by the company’s CEO. more comprehensive L&D framework. choosing a solution that could be extended to other talent management modules in the future. L&D was decentralized and varied in its effectiveness. The initial focus of the taskforce was identifying performance gaps and the learning programs needed to fill those gaps. These models provided a framework that could be further built upon later. and to enable employees to take greater ownership of their own individual performance and development. In addition. To automate the process. By the end of 2008. The taskforce recommended establishing a federated model13 – in which a centralized L&D resource would create and implement enterprisewide programs.  In discussing how learning systems and programs would be managed and delivered. to cascade organizational goals.

During 2009. The company also plans to further enhance its succession planning process. development plan and L&D programs completed and pending in a single view. reporting and online delivery. which had been decentralized and largely driven by individual hiring managers and HR generalists. a team of approximately a dozen business and HR leaders from across the company. processes and practices. Recruiting activities (such as candidate sourcing. The company’s recruiting process also underwent a major change during 2009.Talent Management Factbook 2010 Case in Point: Path to Integrated Talent Management (cont’d) 52 It was around that time (late 2008) that the company realized it needed to look at the broader picture of talent management. The council’s mission was to guide the company’s talent management strategies. Another key initiative was to standardize onboarding and set up the process in the new LMS to provide a smooth transition for new recruits into the company. In addition. screening and applicant tracking). the talent management council began working on a number of initiatives to further improve the consistency and integration of talent processes. based on the same set of skills and behaviors. so that candidates could be evaluated. so that managers and employees can access an employee’s performance review. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . the competency models were extended to the recruiting process. one of the council’s initiatives was to select an LMS to automate course enrollments. including talent reviews and implementation of an automated solution to view talent profiles and track succession candidates. closely linked to the strategic KEY POINT The L&D taskforce evolved into the talent management council. the council worked to revamp the company’s leadership training to incorporate the defined leadership competencies.  Another important project underway this year is piloting a new workforce planning process. as well as to roll out a new front-line supervisory training program enterprisewide. In addition. One was linking employee development plans with L&D opportunities. driven primarily by the HR team. The goal is to have all information in one place. The L&D taskforce thus evolved into the talent management council. In 2010. were outsourced to a thirdparty firm. a team of approximately a dozen business and HR leaders from across the company. rather than individual talent processes.

Performance appraisals Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . Today. In addition. performance management and recruiting. followed a somewhat similar path as that described in the previous case in point. e Boulay. Boulay’s path to integration is described briefly in the following case in point. the company is defining a roadmap for further optimizing these processes. The organization has learned that the right governance model and leadership are critical to improving talent management. and for improving its workforce and succession planning processes. Two years ago. the company had few formal talent processes in place. Zibell & Co.  BEST PRACTICE Change management includes enlisting the support of “champions” throughout the company as key influencers. talent management at the company was in its very early stages. leadership development. The firm created a new leadership position to advance its talent initiatives. This executive’s initial work was around defining competency models. Importantly. to identify and address critical future talent needs. a change management strategy is essential to help guide the organization along this path.  Case in Point: Boulay. Heutmaker. the company is well-positioned along its path to mature and effective talent management. Zibell & Co. Zibell & Co Boulay. Heutmaker.Talent Management Factbook 2010 Case in Point: Path to Integrated Talent Management (cont’d) 53 business planning process. is a Midwestern accounting firm of 135 employees. This company’s example shows how far a company can progress in a relatively short amount of time. Just two years ago. which were then used as the basis for improving the consistency and integration of other talent processes. the company has more consistent. With these lessons under its belt. coordinated processes for L&D. Heutmaker. Change management is not just a training class – it also includes enlisting the support of “champions” companywide to influence and help others work through any changes or new processes.

the company holds “partner discussions. Together. career development. by mid2010. and workforce planning. In the spring and fall. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . This role was responsible for performance management. they establish a development plan based on these gaps and defined competencies. Under the new performance management process. Heutmaker. leadership development.  In 2008. No L&D opportunities were offered outside of the standard accounting requirements and a few general courses. The new process also calls for setting employee goals. learning and development.Talent Management Factbook 2010 Case in Point: Boulay. each employee meets with a partner to review his / her performance gaps. which are then evaluated in the next performance review cycle. Among the first tasks of the new talent development director were to define a competency model and revamp the firm’s performance management process.  To fulfill these development plans. The company chose a software solution to automate the activities of goal-setting and performance reviews. A series of focus groups with staff members were conducted to finalize a list of competencies. reviews are conducted twice per year. The company’s director of HR continued to manage recruiting and compensation initiatives. the firm hired a director of talent development to help build the organization’s talent management capabilities.” In these discussions. a few months after each performance review cycle. These were then incorporated into employee performance reviews. the organization began testing an online catalog of KEY POINT Among the first tasks of the new director of talent development were to define a competency model and revamp the firm’s performance management process. in January and June. during which employees are evaluated against the defined competencies. The next step was to link the performance management process with employee development. Employee development and career planning were virtually nonexistent. Zibell & Co (cont’d) 54 consisted of a Microsoft Word document outlining an individual’s strengths and weaknesses. the organization created a new competency-based learning curriculum. Specific tax and audit skills were identified as part of the competency discussions and. Both of these positions reported to the firm’s managing partner.

performance management. It is clear that competencies are the “glue” that binds the organization’s talent processes. e Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . Zibell & Co (cont’d) KEY POINT The company’s newhire orientation program is now linked to the competencies.) From virtually ground zero. During this retreat. teamwork and leadership capabilities) will be available in the organization’s new LMS. career planning. development. Heutmaker. which drive career counseling discussions. Boulay has been able to advance its talent management efforts considerably. Employees wanting to follow a certain career path know what is expected and how to find the appropriate development to help them achieve the goals. The company’s new-hire orientation program is now linked to the competencies. the firm now has consistent and integrated processes for onboarding. and compensation.Talent Management Factbook 2010 Case in Point: Boulay. The next step in the talent cycle is the annual partner retreat. These courses (along with programs targeting communications. which occurs in August. In this way. In just 18 months. succession planning and compensation processes are tied together. learning and development. The firm’s partners have given these talent initiatives their complete support. which has been built out to serve as a portal to development opportunities and the learning calendar. and new hires are assessed and offered appropriate development opportunities. (See Figure 25. and new hires are assessed and offered appropriate development opportunities. 55 accredited courses. The LMS will be accessible from the firm’s intranet site. the performance management. succession planning. Career paths are also based on these competencies. to be implemented by the fall of 2010. partners meet collectively to determine employee bonuses and to identify staff for future potential partnership positions. without which these efforts would not have been successful. all employees are assessed on these competencies and assigned training based on the identified gaps. During the semiannual performance reviews.

This plan begins with determining the appropriate organizational structure and governance model. Heutmaker. A good way to plan for integration is to create a map of talent processes. 2010. along with a roadmap for achieving these goals. The Boulay and U.. including current state and desired future state.S. the organization can then look at defining job roles and competency models. Zibell & Co. these are the foundation for other talent processes.-based manufacturing company stories are just two examples of how companies can embark on a path toward effective talent management. These efforts should be laid out as part of the organization’s overall talent strategy. Once the right talent management leadership and team are in place. An example of three-year roadmap for integration is shown in Figure 26. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material .Talent Management Factbook 2010 56 Figure 25: Boulay’s Path to Integrated Talent Management Define Competencies Revamp Performance Mgmt Process Select & implement PM System Link PM process to compensation & succession planning Create competencybased learning curriculum Link competencies to onboarding Link competencies to career paths Select & implement LMS 2008 2009 2010 Source: Boulay. As mentioned previously.

The next major step is to integrate leadership development and succession management efforts. and how and when reviews are conducted. are linked to leadership development activities. Compensation and pay-for-performance initiatives come next.Talent Management Factbook 2010 57 KEY POINT Organizations can create a map of talent processes. These should be tied into the performance management process. Career management efforts are closely related and should also be linked to development activities. impacts business metrics. such as customer satisfaction. Once competencies are defined. whether or not they are being groomed as successors. they can be incorporated into the organization’s performance management process. succession candidates need to be assessed and development plans created to close any identified gaps. It is through this integration that L&D leaders can design programs to improve employee performance which. Development plans are needed to help employees acquire the skills and capabilities for moving through these career paths. job assignments or rotations. These development plans can then be linked to learning and development opportunities. A process for creating and reviewing development plans should also be established. in terms of evaluation criteria. should have defined career paths. leading to the accelerated development of successors to ensure future organizational bench strength14. Therefore. such as coaching. in turn. All employees in critical roles. These development plans. mentoring. in turn. This is another very important linkage. as these are important to employees being able to meet their performance goals. rating scales. This process should be reviewed for consistency across the company. After identifying successors. so that L&D programs can be created to close these gaps. Career paths are not always upward trajectories – they may also include lateral movements and job rotations. along with a roadmap for achieving these goals. This integration between performance management and L&D is important to organizational effectiveness. including current state and desired future state. companies must ensure the readiness of this talent to move into the next positions when necessary. In addition. overall performance ratings can be used to identify skills gaps across employee groups. product quality and company revenue. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . so that KEY POINT Linking leadership development and succession management activities can accelerate the development of successors to ensure future organizational bench strength. 14 “Bench strength” refers to the capabilities and readiness of potential successors to move into key professional and leadership positions. as well as formal training programs.

these activities are also tied in with the organization’s workforce planning efforts. In this case. 15 “Job profiles” define the required skills. the company needed to prioritize the integration of its recruiting efforts with its competency management and workforce planning initiatives. based on individual needs and subject to business goals. characteristics of high performers can be used to build profiles of successful candidates to improve recruitment efforts. their assessments can be used to determine development needs. so that candidates can be assessed against the same set of criteria. as well as the current maturity and integration of processes. in order to ensure that it acquired the right talent for the newly defined roles. competencies. certifications. should be tailored for high potentials and other talent segments.Talent Management Factbook 2010 58 rewards are tied to meeting specific performance results. Thus. both monetary and non-monetary. which are then met with training during the onboarding process and afterward. Recruiting activities should incorporate the competencies used in other processes. the roadmap for each organization will be different. KEY POINT Organizations must build their own roadmaps according to their business and talent strategies. In addition. For each organization. In addition. After candidates are hired. Note that this is just one example of an integrated talent management roadmap. Recruiting should be closely linked with the workforce planning process. work experiences and other attributes required for success in a particular job or role. which identifies current and future skills gaps and headcount needs. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . the business and talent needs. The final steps in this roadmap cover recruiting and onboarding. a global technology company was in the process of redefining the job profiles15 and competencies associated with one of its critical talent segments. Organizations must build their own roadmaps according to their business and talent strategies. For example. will vary. rewards packages. In this way.

“Case in Point: Talent Management Structure at a Financial Services Company”). Cross-Functional Projects – One way to improve coordination across talent processes and people is through cross-functional projects. staff members from two different talent management Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . when a financial services company set out to create a new skills development program. These are described briefly as follows. our study revealed a number of best practices for fostering collaboration among these personnel. As mentioned in a previous case in point (see section. Fostering Integration Integrating talent processes goes beyond organizational processes and data-sharing. Whether talent management staff is all under one executive or spread out across multiple functions. 2010. It calls for communication and cooperation from the people involved in different talent functions.Talent Management Factbook 2010 59 Figure 26: Sample Three-Year Talent Management Roadmap Organizational Structure Job Profiles Competencies Performance Management Integrated Learning & Development Plans Leadership Development Succession Planning Career Management Compensation Pay for Performance Recruiting / Talent Acquisition Onboarding Q1 Year 1 Q2 Q3 Q4 Q1 Q2 Q3 Year 2 Q4 Q1 Q2 Q3 Q4 Year 3 Source: Bersin & Associates.

the talent management team meets on a bimonthly basis. about one-half of all HR generalists rotate into one of the talent management roles. These rotations help to build skills and experiences. This type of cross-functional collaboration brings a broader perspective to each project and also expands the skills sets of staff members. If an employee or manager leaves the company (voluntarily or involuntarily). Reviewing talent metrics and progress against goals will help the team understand what is working and what is not working – and then allow the team to work collaboratively to correct any issues. a way to strengthen connections between talent processes is through internal communications. Did we hire the wrong person? Was the person given the right development? Did we manage the person’s career appropriately? These questions look at talent challenges from multiple perspectives and foster collaboration on the entire talent cycle. such as. Both of these individuals were uniquely qualified to contribute to the project – the L&D professional for her knowledge of instructional design and learning principles. functions were selected to co-lead the project. At General Mills. Job Mobility – Some companies encourage job rotations across talent management functions to promote a better understanding of talent processes and better teamwork. such as talent acquisition. This communication reinforces the linkage between L&D. Communications – Finally. asking themselves questions. the talent acquisition professional for her knowledge of participant skills and profiles from the screening and recruiting process. for example. The company’s email (see Figure 27) provides managers with instructions for entering employee performance ratings. performance management and rewards. as well as to enhance communication and teamwork across the talent management and HR functions. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . and whether people are in the right positions to meet current and future needs.Talent Management Factbook 2010 60 KEY POINT Job rotations across talent management functions can promote a better understanding of talent processes and more effective teamwork. and. General Mills uses graphics and communications to promote the continuity across processes. the team members explore the reasons for the departure. The team looks at the flow of talent.  Team Discussions – Talent management staff (and business leaders) should meet regularly to discuss talent issues. These can help to reinforce the relationships between talent management activities to managers and HR staff across the company. At a midsize financial services company. and how to access training programs and resources. L&D or compensation / rewards. For example. The job rotations last approximately two years for managers and three years for directors.

Talent Management Factbook 2010 61 Figure 27: Example of Communications at General Mills Source: General Mills. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . 2010.

and. Many organizations waste a great deal of time and resources on their measurement activities.bersin. The metrics should be actionable. The organization must have a plan for how to compile. One of the challenges. 2010. please see the following two reports: (1) The State of Learning and Talent Measurement. July.com/library.Talent Management Factbook 2010 62 Measuring Success As part of their talent strategies. Both reports are available to research members at www. What Metrics to Use? KEY POINT Metrics should align with business and talent goals. allowing leaders to make data-driven decisions on the people aspects of the business. as well as being cost-effective to collect and analyze. These metrics should be analyzed and communicated on a monthly or quarterly basis to enable the organization to take prompt action on the information. analyze and communicate talent metrics and success indicators. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . This information should be monitored for the overall health of the organization’s talent management strategy. Figure 28 shows some of the metrics commonly tracked by organizations. Organizations should choose a set of key metrics that are aligned with their business and talent goals. however. Bersin & Associates / Josh Bersin. with little consideration regarding the usefulness of the metrics. these metrics are the culmination of the organization’s talent management efforts. companies need to identify how they will measure the success of their efforts. (2) Measuring the Business Impact of Your Talent Strategies. and may be tailored for different audiences. April 2009. meaning that they are under the organization’s control. 16 16 For more information on talent measurement strategies. Moreover. is determining what metrics are important to the organization. Bersin & Associates / Stacey Harris.

The importance of metrics will vary by audience. 17 For more information. Bersin & Associates / Stacey Harris. July. Among the most popular metrics tracked are the following17:  • Employee engagement. • Employee turnover.Talent Management Factbook 2010 63 Figure 28: Example of Talent Management Metrics Talent Strategy & Planning         % of key positions vacant % of employees with critical skills Turnover rate Employee engagement Average tenure Time to productivity Cost of external hire vs. • Time / cost to hire. Measuring the Business Impact of Your Talent Strategies. 2010. 2010. • Performance ratings. competitors Compensation Management Source: Bersin & Associates. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . promoting within Career & Succession Management         Employee engagement % of key positions vacant Turnover rate of key employees % of individuals in key positions who are promoted from within % key positions with qualified & diverse replacements % of employees with development plans Expected continued service of high level performers % of employee on actively pursuing career paths Sourcing & Recruiting         Leadership Development      Employee engagement Retention of leaders Rate of Progression/Promotion Individual Performance/Behavioral Change Organizational Performance (effectiveness measures) Performance Management  Positive performance ratings following promotion  % of employees with development plans  Employee engagement (all measures )  Retention of high performers  Time to productivity  Turnover rate  Turnover rate of key employees  Turnover rate of diverse employees  Turnover rate by performance rating  Tenure by source of hire  Tenure by performance ratings Learning & Development  Employee engagement  % of employees with development plans  Impact of development program (effectiveness measures)       Employee engagement MBO payout / attainment by performance rating Compare to performance rating Compare to job / salary grade level Compare to critical positions Compare to critical positions vs. promoting within Cost to maintain critical talent pools % of key positions vacant Time to fill critical vacancies Reduction in vacancy rates Source of hire for high level performers Cost of bad hires Tenure by source of hire Time to productivity Cost of external hire vs. Many companies create separate reports or dashboards for different talent functions and for their executive teams.

Case in Point: Metrics for a Financial Services Company A midsize financial services firm has identified metrics in four key talent areas – diversity. with metrics divided into four quadrants. and. The real value of metrics can be realized when they are combined with business data. Engagement metrics can be used to gauge critical organizational issues (such as retention. resources and motivators necessary to meet organizational goals. • HR spending. Employee engagement is one of the most frequently tracked talent metrics. recruiting metrics (time / cost to hire). A N A LY S I S The real value of metrics can be realized when they are combined with business data. The report resembles that shown in Figure 29. This measure is seen today as one of the key indicators of the health and wellness of organizations. tools. FORTUNE’s “Top Companies for Leaders” and FORTUNE’s “Most Admired Companies” lists. In addition. some companies look at external awards or lists as measures of their success. A report that tracks these metrics is sent to the CEO and executive staff on a quarterly basis. The following case in point describes the metrics analyzed and tracked by a midsize financial services firm. Several companies we interviewed mentioned “Best Company to Work For” lists. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . staffing. and HR spending.Talent Management Factbook 2010 64 KEY POINT Employee engagement is one of the most frequently tracked talent metrics. L&D utilization. performance ratings distributions. recognition and development. All of these metrics are individual snapshots which only provide a single point of reference for decision-making. manager capabilities and career opportunities). Companies (such as Phillips and WellPoint) have identified engagement metrics as a key component to ensuring their workforces have the leadership. as well as trended over time. as well as provide insights as to how connected employees are to the company’s goals and directions. Additional metrics often viewed by senior leaders include retention or turnover rates. as well as trended over time. • Training and development hours.

The percent of annual recognition budget that has been used year to date. c. Diversity – One of the company’s talent goals is to improve diversity. in order to further advance the organization’s talent efforts. Development – The company considers development to be critical to building employee skills and furthering career paths. Turnover. Lateral moves. b. Recognition – A key talent initiative is to improve recognition programs. which is the driver of the slogan. The company has established an annual budget for a number of awards and recognition opportunities. and. 65 1. b.” The key metrics tracked include L&D completions and spending. Therefore. data is tracked on the employee and executive populations according to ethnicity. the team can discuss what is working – and what is not working. Total spending. e Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . Based on these quantitative inputs. 2. 3. This quarterly report keeps the talent management team and executives focused on the key talent measurements of the company. gender and tenure. to further advance the organization’s talent efforts. Total employees.) The data serves as the basis for discussion about talent initiatives. and. Metrics tracked include:  a. Staffing –The company has identified the following critical workforce metrics: a.Talent Management Factbook 2010 Case in Point: Metrics for a Financial Services Company (cont’d) KEY POINT Based on talent metrics. “Invest 2 percent in Yourself. The number of recognition awards granted. c. enabling leaders to take prompt action when necessary. The annual target is 40 hours of development per employee. (See Figure 29. 4. the team can engage in a qualitative discussion around what is working – and what is not working.

opm.S.18 18 Source: “Human Capital Assessment and Accountability Framework (HCAAF): Systems. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . The metrics are geared toward ensuring an effective workforce by focusing on talent management outcomes from three perspectives – organization.Talent Management Factbook 2010 66 Figure 29: Quarterly Metrics for Financial Services Company Source: Bersin & Associates. Standards. Each agency must include these metrics in its annual report. and Metrics. employee and merit system. As another example. Figure 30 shows a subset of metrics tracked by U. government agencies.gov/hcaaf_resource_ center/assets/hcaaf_ssm.pdf. 2010.” available at http://www.

slightly below the three percent turnover found in 2008.Talent Management Factbook 2010 67 Figure 30: Human Capital Assessment and Accountability Framework (HCAAF) Talent Management System Metrics Required Metric Organization Metric – Competency Gaps Closed for Mission-Critical Occupations Description Difference between competencies needed and competencies possessed by employees in mission-critical occupations Purpose To determine how the agency should target its recruitment. Among these companies. Another important metric is turnover among high performers – these individuals are important to the organization. Employee Perspective Metric – Talent Management Index A score based on items from the govermentwide annual employee survey Employee Perspective Metric – Job Satisfaction Index A score based on items from the govermentwide annual employee survey An assessment. Only one-half of the companies in our study were able to provide a figure for high-performer turnover. Voluntary turnover accounted for onehalf of this figure or six percent overall – a decline from the 10 percent voluntary turnover rate found in 2008.S. rules and regulations governing the talent management system Merit System Metric – MeritBased Execution of the Talent Management System Metrics from Our Study KEY POINT Voluntary turnover declined in the U. processes and practices executed under the talent management system comply with the merit system principles and related laws. Unfortunately.S. of compliance with metir system principles and related laws. As shown in Figure 31. conducted by OPM or by agencies with OPM oversight. averaged 12 percent in 2009. rules and regulations Source: Bersin & Associates. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . retention and development efforts to bring the competencies of its workforce into alignment with the agency’s current and future needs To determine the extent to which employees think the organization has talent necessary to achieve organizational goals To determine the extent to which employees are satisfied with their jobs and various aspects thereof To determine that decisions. total turnover in the U. 2010. policies. due largely to the flagging job market. which are important metrics to nearly every company. the figures show an average turnover rate of two percent among high performers in 2009. most companies do a poor job of tracking this metric. from 10 percent in 2008 to six percent in 2009. Our study captured data on turnover rates.

is poised to changed as the job market picks up in the coming year. Large companies had higher voluntary turnover rates and turnover among high performers. Source: Bersin & Associates. 2010. They may not feel as valued or as close to the business. onboarding and development. This. Turnover rates also declined in every company size category from 2008 to 2009 due largely to the flagging job market. onboarding and development. even if unsatisfactory. Total 2008 to 2009 Total turnover (voluntary and involuntary) 12% N / A* 6% 10% 2% 3% 0% 2% 4% 6% 8% 10% 12% 14% 16% 18% 20% Voluntary turnover High-performer turnover 2009 2008 *N/A: Total turnover (voluntary and involuntary) was not measured in our 2008 study. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . of course. during a down economy.) Employees are more apt to stay in a position. causing them to spend more on recruiting. (See Figures 32 to 35. Employees in a large company may not feel as connected or engaged as those in smaller companies. thus leading to higher turnover.Talent Management Factbook 2010 68 Figure 31: Turnover Metrics – U.S. KEY POINT Large companies have higher turnover. These higher turnover rates are problematic for large companies because it means that they are spending more resources on recruiting. It is much less costly and more effective to retain and develop current employees. Large companies often find it harder to retain employees due to their more impersonal nature.

2008 to 2009 Small (100 .000+ employees) 0% 2% 4% 6% 8% 10% 12% 12% 14% 16% 18% 20% Source: Bersin & Associates.000+ employees) 0% 2% 4% 2009 2008 Source: Bersin & Associates.999 employees) 12% Midsize (1. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . Figure 33: Voluntary Turnover by Company Size – U.S.999 employees) Midsize (1. Figure 34: High-Performer Turnover by Company Size – U.9.S. 2009 Small (100 . 2010.000 .000+ employees) 2009 2008 Source: Bersin & Associates.9.999 employees) 2% 2% 2% 3% 4% 6% 6% 8% 10% 12% 14% 16% 18% 20% Large (10.000 .Talent Management Factbook 2010 69 Figure 32: Total Turnover by Company Size – U.9. 2010.000 .S.999 employees) 12% Large (10. 2010.999 employees) 6% 10% 6% 10% 8% 12% 0% 2% 4% 6% 8% 10% 12% 14% 16% 18% 20% Midsize (1.999 employees) Large (10. 2008 to 2009 Small (100 .

 Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . fewer employees would be promoted. a return to significant job growth is still a long way off. one insurance firm changed its strategy to recruit for potential and then build the necessary skills in various disciplines. Promotion Rates KEY POINT With limited projected job growth. L&D programs must be adjusted to build a diversity of skills through job rotations and other development activities. In this type of environment. *Due to missing data. 2010. Local) Healthcare / Medical Insurance* Manufacturing Retail* Technology* 14% 15% 10% 16% 9% 11% 29% 12% Voluntary Turnover 8% 9% 8% 8% 8% 5% 12% 5% High-Performer Turnover 2% 4% 4% 2% 2% 1% 4% 2% Source: Bersin & Associates. State. therefore.Talent Management Factbook 2010 70 Figure 35: 2009 Turnover Metrics by Industry Total Turnover Banking Business Services / Consulting Government (Federal. these industries have sample sizes <30. looking at ways to motivate and retain employees with lateral career opportunities. Another useful metric is the number of promotions awarded to employees in a given year. in a recessionary year. Therefore. which is a key talent initiative within many companies. upward promotions facilitated by an expanding employee base will not be possible for some time to come. Although many companies will initiate hiring in the coming year. rather than up the career ladder. We would expect that. recruiters must look for candidates who are comfortable moving around a career lattice. Leadership development and succession management initiatives must also incorporate lateral movement. Our study found that only about one-in-four companies promoted 10 percent or more of their employees in 2009. Many companies are. This is an indication of job mobility. Furthermore.

who have the potential to succeed in a culture of lateral career moves. Rather than looking for highly skilled. a midsize insurance firm reported that its recruiting strategy has changed considerably during the past two years.19% were 4% promoted 6% 10% .9% were promoted 28% Source: Bersin & Associates. Total 2009 (percent of employees promoted in 2009) 20% . with a more diverse set of skills.S.29% were 30% or more were promoted promoted 3% 15% . Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . 2010. The firm’s interviewing process now uses panels to incorporate a diversity of perspectives.Talent Management Factbook 2010 71 As an example. upwardly mobile candidates (the target profile in past years).14% were promoted 17% Fewer than 5% were promoted 42% 5% . the company now looks for candidates.  Figure 36: Promotion Rates – U. . This is a very different approach from prior years and impacts nearly every talent process – from recruiting to development to career and succession management. The talent philosophy is to recruit for potential and then build the necessary skills in various disciplines.

S. 2010.S. local) Manufacturing Healthcare / Medical 0% 10% 48% 39% 39% 33% 28% 25% 23% 20% 20% 30% 40% 50% 60% *Percent of companies promoting 10% or more employees in 2009. Figure 38: Promotion Rates by Industry – U.Talent Management Factbook 2010 72 Figure 37: Promotion Rates by Company – U. Source: Bersin & Associates. 2009 (percent of companies promoting 10 percent or more employees in 2009) Banking Technology Retail Insurance Business Services / Consulting Government (federal. 2010. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . Source: Bersin & Associates. 2009 (percent of companies promoting 10 percent or more employees in 2009) Small 27% Midsize 32% Large 30% 0% 10% 20% 30% 40% 50% 60% *Percent of companies promoting 10% or more employees in 2009. state.

only 38 percent of companies gave themselves high marks in this area. • Improving employee productivity. career opportunities and rewards programs.19 (See Figure 39. Given that most companies are just beginning to develop their talent management strategies. and. The second-highest rated category was “hiring the best people. • Creating high engagement. Many companies have responded reactively to the changes that have occurred over the past two years. With all of the restructuring that has occurred over the past few years. with little planning or forethought to talent needs. we might have expected more organizations to say that they now have the right people in the right jobs. employees will begin looking elsewhere. Without the right development. it is not surprising that none of the categories received exceptionally high ratings. most organizations’ talent management practices are immature. processes and systems now to manage their sourcing challenges when hiring picks up in earnest. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . In the second tier of ratings. A N A LY S I S A key part of talent management is looking at the flow of talent. Smart companies are putting in place the people. But. and making sure employee skills and interests are well-aligned with their roles. as we have seen previously. This is a key part of talent management – looking at the flow of talent.Talent Management Factbook 2010 73 Effectiveness Measures KEY POINT Smart companies are putting in place the people. With an overabundance of job seekers. As the economy picks up and companies begin to hire again. assessing talent gaps. between 20 percent and 24 percent of organizations gave themselves high marks in the following areas: • Having the right people in the right jobs. it is a relatively easier task to retain employees in a nascent job market. 19 A “high mark” is defined as a rating of “6” or “7” on a seven-point scale. companies will soon face significant hiring challenges. we asked HR professionals to rate how well their organizations perform in a number of areas.” Still. retention issues will come to the forefront. Companies gave themselves the best scores on “retaining top performers. processes and systems now to manage internal and external sourcing challenges when hiring picks up in earnest.) Of course. assessing talent gaps. As an additional gauge to determine how well companies are executing on their talent initiatives.” with approximately one-third of organizations giving themselves high ratings in this area. and making sure employee skills and interests are well-aligned with their roles.

Talent Management Factbook 2010 74 KEY POINT Companies gave themselves the lowest ratings in the areas of development and future talent planning. given the layoffs. Engagement is certainly an area that has garnered significant attention of late. • Developing great leaders. • Planning our future talent needs. The lowest ratings came in the areas of development and future talent planning. • Having a pipeline of ready successors. The findings show. specifically: • Developing employees. since these are all areas that help organizations remain competitive and successful in the long term. however. restructuring and salary freezes that have occurred in many companies over the past two years. This underscores the point that HR organizations are least equipped to help their businesses with long-term talent planning. As Figure 39 illustrates. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . This is troubling. and. just 10 percent to 16 percent of companies gave themselves high ratings in these areas. that organizations will need to improve their efforts significantly in this area. Companies realize that engagement is a key ingredient to retention and productivity. • Building career paths for critical employees. the lower scores are not surprising. As for employee engagement and productivity.

Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . 2010.Talent Management Factbook 2010 75 Figure 39: Effectiveness Measures (self-rated) – U.S. 2010 Retaining top performers 38% Hiring the best people 31% Right people in the right jobs 24% Creating high engagement 21% Improving employee productivity 20% Developing employees with right skills 16% Building career paths for critical employees 14% Developing great leaders 14% Planning future talent needs 13% Pipeline of ready successors 0% 10% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Percent of companies rating themselves as “6” or “7” on a seven-point scale Source: Bersin & Associates.

• Creating high engagement. So what is the payoff? Our research provides some answers to this question. The findings show that the higher the Level of Maturity. As this chart demonstrates. We compared the effectiveness ratings of companies in each Level of the Maturity Model (see section. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material .Talent Management Factbook 2010 76 Impact of Mature Talent Management KEY POINT Our research demonstrates a large payoff in integrating talent management initiatives. and.  The areas exhibiting the greatest differences are shown in Figure 40. • Building career paths for critical employees. the more effective companies are in each of the talent areas studied. • Planning for future talent needs. • Having a pipeline of ready successors. Companies spend a great deal of time and resources integrating and improving their talent management initiatives. an organization’s talent management maturity has the greatest impact on the following areas: • Developing great leaders. “Integrating Talent Processes” for a description of the Maturity Model).

Talent Management Factbook 2010 77 Figure 40: Impact of Talent Management Maturity on Effectiveness Measures – Areas of Highest Impact Developing great leaders -24% Pipeline of ready successors 1% 16% 38% -26% Building career paths 1% 19% 42% -23% Planning future talent needs 0% 19% 37% -25% Creating high engagement 1% 19% 38% -23% -30% -20% -10% 0% 2% 10% 16% 31% 20% 30% 40% 50% Percent difference from the average rating. for example. Level 2 organizations (those with standardized talent processes that are in the early stages of integration) scored just above the average. With the large number of organizations at this Maturity Level (nearly one-half of all companies). Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . in the area of “developing great leaders. So. 2010. Level 4: Strategic Talent Management Level 3: Integrated Talent Management Level 2: Standardized Talent Processes Level 1: Siloed HR Processes Source: Bersin & Associates. it naturally follows that these companies will be at or near the average rating for all areas. In Figure 40. the vertical line at zero percent represents the mean rating across all organizations in the study.” Level 1 organizations (those with siloed HR processes) scored 24 percent below average – meaning that they are much less effective at developing great leaders than companies with higher Maturity Levels. The horizontal bars represent the percent of difference from this mean rating.

2 and 3 at developing great leaders. and are heavily focused on connecting processes and systems. These companies scored 16 percent above the average. As an organization moves from one Level of Maturity to the next. Figure 41 shows the differences in effectiveness in the remaining talent areas. Level 3 companies show a significant improvement in effectiveness scores. Level 4 companies received the highest scores on effectiveness. Although the differences are not as pronounced as in the former areas. talent planning and creating an environment in which employees are highly engaged. which means that they are more effective than both Level 1 and 2 companies at developing great leaders. These are all critical aspects to a company’s success. the more effective organizations become at engaging employees. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material .Talent Management Factbook 2010 78 KEY POINT The higher the maturity level. as companies move up the maturity ladder. they become more effective at each talent initiative. These companies scored nearly 40 percent above the average. Again. meaning that they are significantly more effective than companies in Levels 1. These are companies that have a talent management executive or team responsible for talent initiatives. its effectiveness improves on each of these talent areas. the message is the same. In other words. they become more effective at developing great leaders and having a pipeline of ready successors. The same holds true for the other areas. These are companies with fully integrated talent processes and systems – and in which business leaders and managers are held accountable for talent outcomes. They also become more adept at career management. Finally. as organizations advance their integrated talent management strategies. developing great leaders and creating a pipeline of ready successors.

Level 2 companies score at the average. the organization is better able to implement its talent strategy and successfully meet its talent objectives. Level 4: Strategic Talent Management Level 3: Integrated Talent Management Level 2: Standardized Talent Processes Level 1: Siloed HR Processes Source: Bersin & Associates.Talent Management Factbook 2010 79 Figure 41: Impact of Talent Management Maturity on Effectiveness Measures – Other Talent Areas Developing employees with the right skills -18% 0% 13% 32% Improving employee productivity -18% Right people in the right jobs 1% 11% 29% -17% Retaining top performers 2% 11% 20% -13% Hiring the best people 1% 7% 14% 20% -12% -30% -20% -10% 0% 1% 8% 10% 20% 30% 40% 50% Percent difference from the average rating. having the right people in the right jobs. They are significantly better at developing employees with the right skills than even Level 3 companies. as demonstrated in Figure 41. at 32 percent above the average. 2010. Level 1 companies have the lowest scores on “developing employees with the right skills” – with scores 18 percent below the average. With each successive level. developing and retaining employees. As company progress from one Maturity Level to the next. The same pattern holds true for the remaining talent areas. they become more effective at improving employee productivity. So for example. Level 3 companies score 13 percent above average – meaning that they are more effective at developing employees than companies in Level 1 and 2. Level 4 companies score even higher. KEY POINT Companies with separate or stovepiped talent processes are much less effective at hiring. retaining top performers and hiring the best people. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material .

at four percent or one-half the rate of turnover as Level 1 companies. Level 4 companies have the lowest turnover of all – at just seven percent. whereas turnover among Level 4 companies is one percent. which again demonstrate that as a company advances its integrated talent management strategy. this has serious implications for companies’ productivity and talent initiatives. development. The third metric is turnover among high performers. Promotion rates rise at Level 3. Figures rise even higher at Level 4 to 45 percent.) Again.) Retaining high performers is important to creating a productive. This metric is quite low overall. at Level 3. succession planning and workforce planning efforts. 23 percent of companies in Levels 1 and 2 promoted 10 percent or more of their employees in 2009. In addition. Companies in Levels 1 through 3 show two percent turnover among high performers. They will also have to look at creating tailored rewards programs to retain employees.Talent Management Factbook 2010 80 Impact on Turnover and Promotion Rates KEY POINT Companies with mature. total turnover among Level 1 companies was 15 percent in 2009. they may need to readjust their recruiting strategies to target employees who are comfortable with an environment of lateral. Promotion rates are important to employee engagement and retention. voluntary turnover drops to six percent. it improves its ability to retain employees. Companies with limited promotion opportunities will need to create other options for internal mobility. (See Figure 43. with implications for recruiting. Note that total turnover among Level 4 companies is just one-half the rate as in Level 1 companies – a huge disparity. The fourth metric is promotion rates. The same trend can be seen in the voluntary turnover figures. Voluntary turnover among Level 4 companies is again the lowest. We also compared the turnover rates of companies at each Level of Maturity. the figure drops still further to 11 percent. (See Figure 44. with 31 percent of companies promoting 10 percent or more of their employees. Among Level 2 companies. this figure drops to 13 percent and. which is highest among Level 1 companies at eight percent. the figure drops still further to five percent. Among Level 2 companies. so we do not see as dramatic a drop by Maturity Level as in the previous turnover metrics. KEY POINT Promotion rates are important to employee engagement and retention. among Level 3 companies. As shown in Figure 42. fully integrated talent management have onehalf the rate of turnover. high performance workforce. Companies with limited promotion opportunities will need to create other options for internal mobility – such as lateral moves or job rotations. rather than upward. The results are shown in Figures 42 to 45. As shown in Figure 45. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . career moves.

Figure 44: Impact of Talent Management Maturity on High-Performer Turnover Level 1: Siloed HR Processes Level 2: Standardized Talent Processes Level 3: Integrated Talent Management 2% 2% 2% 1% 1% 2% 3% 4% 5% 6% 7% 8% 9% 10% Level 4: Strategic Talent Management 0% Source: Bersin & Associates. 2010. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . Figure 43: Impact of Talent Management Maturity on Voluntary Turnover Level 1: Siloed HR Processes Level 2: Standardized Talent Processes Level 3: Integrated Talent Management 8% 6% 5% 4% 0% 2% 4% 6% 8% 10% 12% 14% 16% 18% 20% Level 4: Strategic Talent Management Source: Bersin & Associates. 2010. 2010.Talent Management Factbook 2010 81 Figure 42: Impact of Talent Management Maturity on Total Turnover Level 1: Siloed HR Processes Level 2: Standardized Talent Processes Level 3: Integrated Talent Management 15% 13% 11% 7% 0% 2% 4% 6% 8% 10% 12% 14% 16% 18% 20% Level 4: Strategic Talent Management Source: Bersin & Associates.

000 among Level 1 companies. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material .com/library or for purchase at www.300 revenue per employee for companies in Levels 3 and 4. Available to research members at www. For more information.000 of revenue per employee – higher than the $188. com/tmfactbook. Our research last year revealed that these companies laid off larger numbers of employees during the recession than companies with higher maturity levels. 2009 Talent Management Factbook®: Best Practices and Benchmarks in Talent Management. Impact on Employee Productivity KEY POINT More mature companies continued to invest in talent initiatives despite the worsening economy.bersin.Talent Management Factbook 2010 82 Figure 45: Impact of Talent Management Maturity on Promotion Rates Level 1: Siloed HR Processes 23% 23% 31% 45% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Level 2: Standardized Talent Processes Level 3: Integrated Talent Management Level 4: Strategic Talent Management Source: Bersin & Associates.bersin.000 for Level 3 and 4 companies. companies in Levels 3 and 4 were combined. companies in Levels 1 and 2 were more likely to cut back 20 21 Due to missing data. revenue per employee increased from 2008 to 2009 among Level 1 and 2 companies. and jumping up to $195. revenue per employee was $141. at $200. however.21 In addition. Last year.000. 2010. But Level 2 companies actually had the greatest productivity. as measured by revenue per employee. We believe that a primary underlying factor here is the impact of the recession. As shown in Figure 46. our research showed a clear correlation between talent management maturity and productivity. July 2009. rising to $163. at approximately $163.20 In 2009. As shown in Figure 46. Level 1 companies again had the lowest revenue per employee. Bersin & Associates / Karen O’Leonard.000 for Level 2 companies. the pattern is not so clear-cut. The final area we studied was employee productivity.

These companies are more effective at developing leaders.000 $200. Figure 46: Impact of Talent Management Maturity on Revenue per Employee – 2008 to 2009 Level 1: Siloed HR Processes $162. creating a pipeline of ready successors and boosting employee engagement. they have lower turnover and higher promotion rates. the findings demonstrate the value of a mature talent management strategy.000 Level 2: Standardized Talent Processes Mature companies continued to invest in employees. Furthermore. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material .000 $188.Talent Management Factbook 2010 83 significantly on their employee development.300 $195.000 $150. career planning and hiring great talent. These more mature companies have a long-term outlook on talent. Conversely. and have sacrificed employee productivity in the short term to keep their employees engaged and committed in the long term. These companies did not lay off as many workers during the recession. these companies face significant problems with employee engagement and retention as the job market improves.900 $141. Although these actions may have resulted in higher revenue per employee. these companies excel at employee development.000 2009 2008 Source: Bersin & Associates. sacrificing productivity Levels 3 and 4: Integrated / Strategic Talent Management $250.000 $163.000 $100.000 $$50. What Maturity Level Is Right for Your Organization? Overall. revenue per employee declined from 2008 to 2009 among Level 3 and 4 companies.000 $200. leadership development and spending on other talent initiatives. 2010. employee programs and talent systems despite the worsening economy. As companies move up the maturity ladder and integrate their talent processes. and continued to invest in leadership development.

including the time. the cost and effort to reach this level may not be worth it. Each business unit has its own processes and systems. This is a good example of how a company needs to evaluate its current state and map out its desired future state – which may or may not include a path to full integration within the next few years. Instead. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . if the company decided to centralize its operations at some point in time. In some companies. rather than on complex process redesign efforts. In the case of the high-tech firm just mentioned. Because of these factors. at least in the foreseeable future. then that could present an opportunity to begin mapping out a strategy for more integrated talent management. These findings should serve as motivation for companies to improve their talent management efforts. costs and resources required. and has determined the integration points that provide the most value without excessive time and resource requirements. Of course. and the company operating philosophy in general is “process-light. One high-tech company we talked with said that its operations are extremely decentralized. an organization needs to develop a plan for integration. Companies should focus on improving and integrating the talent processes that will provide the most value according to their talent and business goals. the talent management team has put in place flexible processes.Talent Management Factbook 2010 84 KEY POINT Each company needs to assess the time and resources required to achieve its desired future state for talent management. the company said it has no plans to advance its talent management integration efforts beyond its current standing (which is somewhere between Levels 2 and 3).” meaning that the focus is on just enough process to get the job done.

Source: Bersin & Associates. †Numbers may not total 100% due to rounding. Organizations cannot realize the benefits of integrated talent management if they have disconnected platforms and islands of talent data. 60 percent of U. 2010.5 systems 15% No system (use manual processes) 17% Half of these organizations report little or no integration between their systems 1 system 24% 2 . companies have multiple talent systems in place. gathering the metrics discussed in the previous section can be extremely time-consuming.S. (See Figure 47. Technology plays an essential role in an organization’s talent management strategy. Figure 47: Number of Talent Systems* – U.3 systems 42% *Not including an HRIS / HRMS. Today. companies are using multiple talent systems with little sharing of data. without automated access to consolidated talent data. standalone systems are the reality in most companies.S.S. 60 percent of U. if not altogether impossible. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material .Talent Management Factbook 2010 85 Talent Systems KEY POINT Today.) The majority of these companies report that the integration of these systems is poor or nonexistent. In addition. Total 2010† 6 or more systems 3% 4 . Unfortunately.

organizations stated that they have implemented a performance management system. These applications are powerful and complex – handling bonuses. 23 For more information. There is. solution providers are offering innovation for the first time in many years in the form of new tools to replace the résumé.bersin. Available to research members at www.bersin. an increasing need for pay-for-performance capabilities. and commission calculations. which enable managers to establish complex pay rules based on individual and group performance indices. search engine optimization and mobile recruiting. organizations are reassessing their current talent acquisition technology investments. September 2009. In the last few years. organizations. Finally.bersin.and short-term incentives.com/library. These traditionally homegrown systems have centered around payroll administration. social networking. Today’s integrated performance management solutions provide support for development planning. As a result. April 7. Bersin & Associates / Madeline Laurano. goal alignment. or custom applications built on existing ERP or HR management platforms. managing and tracking learning programs.Talent Management Factbook 2010 86 The most popular automated (software-based) systems are recruiting / applicant tracking systems. Faced with stiff competition in a highly saturated market. Available to research members at www. however.S. Many of these systems are internally developed solutions.22 Just more than 60 percent of U. More than one-half (57 percent) of U.23  KEY POINT Performance management is typically the first module organizations implement in pursuing an integrated systems strategy. Talent Management Systems 2010: Market Realities. The Demand for Innovation and Economic Recovery Spark Growth in the Talent Acquisition Systems Market. succession 22 For more information. These systems provide capabilities for delivering. Saba and SumTotal Systems) have extended their offerings to include performance management. career and succession planning. the leading LMS providers (Plateau. Implementation Experiences and Solution Provider Profiles. long. 2010. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material .S.com/tmsuites.com/library or for purchase at www. and managerfocused compensation management. organizations are using automated systems to administer compensation. Bersin & Associates / Leighanne Levensaler and Madeline Laurano. used by two-thirds of all U. Performance management is typically the first module organizations implement to support a strategy of integrating talent management systems. merit-pay programs and manager-led incentive programs.S. 55 percent of organizations are using an automated system for L&D programs. Today’s integrated solutions provide capabilities for pay-for-performance initiatives. This market is heating up now that companies are looking at hiring again.

the lines between these systems are becoming blurred as solution providers strive to include more functionality and an integrated solution for buyers. please visit www. Thus. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material .com/hihr.Talent Management Factbook 2010 87 Figure 48: Use of Automated Talent Systems – U. High-Impact HR Organization.S.26 (See Figure 49. due to be published H2'2010. management and compensation management. 200924 Recruiting / applicant tracking Compensation administration Performance management Learning management 0% 10% 20% 30% 40% 50% 67% 63% 57% 55% 60% 70% 80% 90% 100% For more information on our upcoming research. Talent Management Systems 2010: Market Realities. with the goal of implementing one application at a time to address a specific need (such as performance management or L&D). 1 Source: Bersin & Associates.bersin. they plan 24 For more information on our upcoming research. Implementation Experiences and Solution Provider Profiles. 2010.bersin. Over time. 25 For more information.25 Our research conducted last year showed that 34 percent of buyers want the full suite from one solution provider – which indicates they are planning to standardize on a talent management suite. High-Impact HR Organization. September 2009.) The vast majority of buyers purchase a suite for future value. 26 Ibid. due to be published H2’2010. System Integration Most buyers are overwhelmed with the sheer number of solution providers and how to approach the integration of their current siloed talent management systems.com/hihr. please visit www. Bersin & Associates / Leighanne Levensaler and Madeline Laurano.

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KEY POINT
Thirty-four percent of organizations plan to implement a talent management suite from a single vendor.

to implement all of their talent management processes on one platform from one solution provider. (See section, “Case in Point: Premier Inc. Implements Talent Management Suite.”) Talent management suites offer many advantages. These systems offer a single, consistent view of talent data, providing a uniform experience for end-users. These suites also provide more actionable information to support workforce planning and talent initiatives, such as decisions regarding performance, development and compensation. For these reasons, many HR organizations (which currently have an array of point solutions) have undertaken large enterprisewide consolidation efforts to standardize on a talent management suite from a single solution provider. These consolidation efforts bring the additional advantages of reduced operational and support costs, as well as fewer resources required for vendor and contract management.

Figure 49: Implementation Plans for Integrated Talent Systems

We will design and build our own talent management systems. 3%
We will integrate our multiple point solutions. 24%

We will implement a talent management suite for multiple process areas and keep some point solutions. 22%

We will implement the talent management applications from our ERP or HRMS provider. 17%

We will implement a talent management suite from one vendor. 34%

Source: Bersin & Associates, 2010.

Bersin & Associates © September 2010 • Not for Distribution • Licensed Material

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KEY POINT
Twenty-two percent of organizations said they will implement a partial suite, meaning that they will use some pieces of an integrated suite, while keeping some point solutions from other vendors.

A single talent management suite is not the only approach to realizing the benefits of integrated talent management – or even the most suitable and pragmatic approach for every organization. Twentytwo percent of organizations said they will implement a partial suite, meaning that they will use some pieces of an integrated suite, while keeping some point solutions from other vendors. This approach brings some, but not all, of the full benefits of a single suite, since there are still multiple systems to be integrated. However, this could be the most practical approach for organizations which have needs beyond what a single suite can provide. Approximately one in four companies intends to integrate its point solutions, largely due to the significant investment they have made in their existing implementations. Depending on the number of solutions and their interfaces, stitching these together can be a lengthy and complex undertaking. Seventeen percent of organizations say they plan to standardize on their ERP vendor’s HCM solution. Many of these applications are very new offerings and are available on the current release of the ERP’s platform. Organizations that are on earlier versions will need to upgrade to take advantage of these new capabilities. Still, many large, global organizations are committed to their ERP investments and will likely upgrade to these HCM capabilities over time. A brave three percent of organizations have decided that they will build their own talent management suites. Developing a common data model, as well as a sophisticated integrated workflow and process management system, across multiple applications is not for the faint of heart. Furthermore, each individual process area is so highly complex – and takes solution providers many months and years to develop basic support. Organizations pursuing this approach will require an empowered and highly engaged IT partner.

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Talent Management Factbook 2010

90

Case in Point: Premier Inc. Implements Talent Management Suite
In 2004, Premier Inc. selected a talent management suite with the confidence that the platform could service all of its talent management needs “down the road.” The company initially implemented only the learning management module to offer competency-based learning and to support its Learning Institute. Following that project, Premier implemented core performance management processes with deep links to the learning module to identify L&D experiences to close performance and competency gaps. For Premier, the next project on its roadmap will be adding support for succession planning, including process and data integration with performance management and development experiences. e 

Impact of Talent Systems
KEY POINT
Automated systems alone do not make an organization more effective.

Companies have high expectations of their talent systems – but systems alone are not the answer to an organization’s talent management challenges. Not surprisingly, our research found that talent systems do not guarantee an organization’s success in meeting talent and business goals.  In comparing companies that use one or more talent systems with those using manual processes, we find that the former group has higher ratings in their development and planning capabilities. As shown in Figure 50, companies with automated systems gave themselves higher ratings in four areas: 1. Developing great leaders; 2. Developing employees with the right skills; 3. Having a pipeline of ready successors; and, 4. Planning for our future talent needs.

Bersin & Associates © September 2010 • Not for Distribution • Licensed Material

more effective in their ability to hire. 2010. So companies using automated talent systems are more effective in these areas. They are not. installing a system that is complicated to use and administer can be less productive than using simple paper-andpencil processes. these four areas are important to an organization’s long-term success. leaders and successors across the company.Talent Management Factbook 2010 91 With respect to the first three areas. Therefore. preparing a pipeline of future successors. retain or engage employees. a learning management system can help to deploy and manage development activities of employees. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . though. The bottom line is that automated systems are not the “magic bullet” to improve the success of talent initiatives. and planning for the organization’s talent needs for the future. Moreover. all four areas are very future-focused – they deal with developing employees and leaders. As many companies have learned the hard way. Source: Bersin & Associates. however. Figure 50: Impact of Talent Systems on Organizational Effectiveness Companies with automated talent systems are better at:     Developing leaders Developing employees Planning future talent needs Building a pipeline of ready successors Companies with manual processes are just as effective at: • • • • • • • • • Hiring the best people Having right people in right jobs Creating high engagement Improving employee productivity Retaining top performers Building career paths Promoting employees Overall retention Revenue per employee These are future-focused activities. More importantly. their turnover and employee productivity metrics are no different from companies using manual processes.

In other words. will make for a more effective organization. they use manual processes) have similar scores on most categories as do companies with poorly integrated systems. But having integrated systems helps an organization to make better decisions about its talent. develop and engage employees. Organizations with integrated systems are more likely to have strong leadership in place. along with the right people and processes. companies with well-integrated systems (those that share data across talent processes and present a single. and have higher employee productivity. disconnected systems. As shown in Figure 51. Our research found that what does make a difference is not just having systems but. Interestingly. which is not significantly different across the categories. The research shows that these companies are better able to hire. The one exception is in the area of retention. business-driven talent strategies and optimized talent processes. companies with no systems (that is.  Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . Of course. having well-integrated talent systems. an integrated system architecture is merely an enabler of effective talent management. unified view to the user) have higher ratings on nearly every aspect of talent management. rather. organizations could just purchase an integrated talent management suite and be done with it.Talent Management Factbook 2010 92 KEY POINT An integrated system architecture is an enabler of effective talent management – helping the organization to make better decisions about its talent. Managers in these companies have access to consolidated information in order to support talent planning. They are also more effective at talent and career planning. That. using manual processes can be just as effective (or as ineffective) as having a series of disparate. Having integrated talent systems does not automatically make an organization more effective – if that was the case.

Talent Management Factbook 2010 93 Figure 51: Impact of System Integration on Organizational Effectiveness (self-rated measures) Building career paths for critical employees Planning future talent needs Improving employee productivity Right people in the right jobs Creating high engagement Retaining top performers Developing employees with the right skills Pipeline of ready successors -9% -7% -12% -7% 11% 10% 9% 7% 8% 26% 23% 21% 17% 22% Companies with wellintegrated systems score highest in every area -6% -9% -4% -8% -9% -2% -4% -5% -12% -19% -15% -9% -40% -20% 6% 8% 14% 29% 39% 31% 18% Companies using manual processes have similar scores to companies with poorly integrated systems -5% -8% -4% -2% 0% 13% 11% 7% Developing great leaders Hiring the best people 20% 40% 60% 80% Systems are well-integrated Systems are somewhat integrated Systems are poorly or not at all integrated Use manual processes Source: Bersin & Associates.50 Systems Are Somewhat or Well-Integrated 12% 6% 2% 32% $200.70 Systems Are Poorly or Not at All Integrated 12% 5% 3% 24% $178. 2010. Figure 52: Impact of System Integration on Talent Metrics System integration can impact productivity and promotions – but not retention.00 Source: Bersin & Associates. 2010. Total turnover Voluntary turnover High performer turnover Promoted 10% or more employees in 2009 Revenue per employee ($000s) Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . Use Manual Processes 12% 7% 2% 14% $185.

and where the data will aggregate for reporting purposes. When selecting or integrating systems. not drive the processes. can drive the strategy and processes forward. A talent management executive can act as a tremendous change agent for the organization – and. These will align to the organization’s key talent initiatives. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . and / or • Increase sales by 20 percent in three business areas through performance improvement in critical positions. In particular. Determining these requirements will aid in the system selection or integration decision. In the end. Many HR professionals do not have the necessary skills sets and organizations need to recruit for these positions. • Reduce costs by 10 percent in supporting functional areas. People. Too many times companies jump into the system selection without the right people and processes in place. Not even strategy. companies are finding that having the right people involved is essential. as seen in the preceding charts. Many companies rush into the system selection process before they are ready. Integrating talent systems can be a lengthy and resource-intensive process – yet one with many benefits. it is the collective behavior of the people in the organization that can make or break a transformation. then design the right processes and then choose the right systems to make the processes more efficient. Talent systems should reinforce the processes.Talent Management Factbook 2010 94 Keys to a System Integration Strategy KEY POINT Talent systems should reinforce the processes. with inputs and outputs from different system components. “We believe people are ultimately the force that drives sustained transformation. with a strong team in place. Examples may include: • Increase leadership bench strength by two levels deep. companies should take a careful and systematic approach. Not processes. Not technology. not drive the processes.” Another key piece is identifying the talent metrics needed for analysis and reporting. The organization should identify the data flow. As a representative from Deloitte explained. Companies should first make sure that they have the right people in talent management positions. and find themselves stuck with the wrong system and broken processes.

Finally. managers who will need to analyze the data. the organization should define a three-year roadmap for system integration which mirrors its plans for talent process improvements. with system requirements defined by three categories: • Tier 1: Absolute requirements needed now. Involve them early in the process. it is excluded from consideration. The Tier 1 requirements are deal-breakers. Building several use-case scenarios27 will be a key part of system evaluation. If a system does not have these capabilities. • Tier 2: Requirements within the next 12 months. Using the above criteria. The Tier 2 requirements are items that are required. 27 A “use case” provides a description of a sequence of interactions between actors. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . and. it holds an advantage over its competitors. These are not requirements. the organization can evaluate systems based on a phased implementation. but will not be implemented until the second or third phase of the implementation. Use cases are often co-authored by systems analysts and end-users. These can include learners. Tier 3 features are useful in making final decisions on the short list of vendors. but if a system has one or more of these capabilities (together with Tier 1 and 2 capabilities). Another consideration is who will be using the system and for what purposes. • Tier 3: Nice to have functionality. and are presented as a sequence of simple steps. They can provide input to the current technology landscape. We have seen successful system implementations rolled out in stages. Finally. and business leaders who will need to view reports. who will need access to different views of the data.Talent Management Factbook 2010 95 KEY POINT A three-year roadmap for system integration should mirror the organization’s plans for talent process improvements. and the system necessary to complete a specific goal or function. and current and future system integration opportunities. Of course. They will also be crucial in predicting operational budget and staff requirements. your organization’s IT personnel will be key contributors to any discussions around system selection or integration. administrators who will need to configure the system.

Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . 2010.Talent Management Factbook 2010 96 Figure 53: Keys to Successful Integrated Systems Strategy • Develop effective governance model and put team in place • Determine key talent initiatives based on business goals • Define metrics for measurement • Research process and system integration opportunities • Design a process and system architecture with three-to-five-year roadmap Source: Bersin & Associates.

Talent Management Factbook 2010 97 Appendix I Study Methodology Bersin & Associates © September 2010 • Not for Distribution • Licensed Material .

so that the survey data better represents the U. The final analysis included U. when contacts from the HR Executive magazine and Bersin & Associates databases were emailed an invitation to participate in an online survey. and 171 large (10.  Figure 54: Respondent Count by Company Size Small companies (100 to 999 employees) Midsize companies (1. 257 midsize (1. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material .S. 2010. Overall figures in this report are weighted by company size.-based organizations with 100 or more employees. The survey yielded a large cross-section of company sizes. with 297 small companies (100 to 999 employees).000 to 9.000 or more employees) participating (see Figure 54). These interviews were designed to gather qualitative information on talent management activities in order to provide a keener understanding of trends and current practices.999 employees) companies.000 to 9.S.000 or more employees) Total 297 257 171 725 Source: Bersin & Associates. The final count of qualified respondents was 725. marketplace.999 employees) Large companies (10.Talent Management Factbook 2010 98 Appendix I: Study Methodology The study was conducted during March and April 2010. The study also yielded a large cross-section of industries (see Figure 55). in-depth interviews were conducted with 17 companies representing a range of industries and company sizes. In addition.

Due to the small sample sizes in some of these categories. there were many industries with sample sizes too small to report. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . The industries included in our analysis are as follows: • Banking / Finance. We include only industries with 30 or more respondents in our analyses.Talent Management Factbook 2010 99 Figure 55: Respondent Count by Industry 2010* Wholesale / Distribution 2% Transportation 3% Utilities 1% Other 3% Aerospace 1% Banking / Finance 8% Telecommunications 1% Technology 5% Retail Pharmaceuticals 4% 1% Oil / Gas / Mining 1% Nonprofit 3% Marketing / Media / Entertainment 3% Business Services / Consulting 10% Construction 3% Education 5% Government 7% Manufacturing 16% Insurance 6% *Numbers may not total 100% due to rounding. Hospitality 3% Healthcare / Medical 13% Source: Bersin & Associates. 2010. we combined a few of the industries for reporting purposes. • Business Services / Consulting. Even so. • Healthcare / Medical.

the reader should keep in mind that the figures for retailers represent a greater proportion of large companies. • Retail. In our sample. state. 38 percent of the retailers are large companies – twice the proportion as in other industries. • Technology (computers. in which small and midsize companies dominate in terms of number of firms. KEY POINT The retail segment in our study has a greater proportion of large companies. ISPs). with approximately 40 percent to 50 percent small companies (100 to 999 employees).000 to 9. The data for each industry is weighted by company size. software. meaning that we were not able to get a representative sample of retailers from our study. 30 percent to 40 percent midsize companies (1. • Manufacturing. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material .999 employees) and 10 percent to 20 percent large companies (10. This is a sampling error.000-plus employees. One exception is the retail segment. and local). Therefore. which may make the sector look more advanced than it truly is. and.) This is consistent with the marketplace. which are more mature in terms of their talent processes than are small and midsize companies.Talent Management Factbook 2010 100 • Government (federal. the results may appear as though retailers are more sophisticated in terms of their talent processes than may be the case if we had surveyed a representative sample of retailers. When looking at the industry-level analyses.

Talent Management Factbook 2010 101 Appendix II Key Talent Integration Points across Talent Processes Bersin & Associates © September 2010 • Not for Distribution • Licensed Material .

• Talent Strategy • • • Workforce Planning • • • Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . 2010.g.. Workforce Planning and Career Management: The practice of identifying individual strengths to improve overall organizational capabilities and workforce planning. populate performance plans. Workforce Planning and Succession Management: The ability for organizations to plan ahead for changes in the leadership pipeline through scenario modeling and “what-if scenarios” (e.Talent Management Factbook 2010 102 Appendix II: Key Talent Integration Points across Talent Processes Figure 56 is an overview of the key integration points by each area of the talent management process. define career paths. Southern Company’s center of excellence involves talent acquisition professionals in the workforce planning process to help close talent gaps). Talent Strategy and Competency Management: One common job profile can be used to develop requisitions for sourcing. create development plans and plan for compensation. Workforce Planning and Total Rewards: Providing organizations with internal and external data needed to build a pay for pay-for-performance culture. Talent Strategy and Performance Management: Evaluation processes provide actionable data regarding gaps in operational roles and skills for talent planning purposes. Source: Bersin & Associates. and Learning and Capability Development: Talent planning drives strategic learning programs and initiatives focused on developing capabilities and addressing critical skills gaps. Figure 56: Key Talent Integration Points – By Talent Process Area Talent Process Area • Key Integration Points Talent Strategy. Braun company align its succession planning to its workforce planning process to ensure that it has the right individuals in the right roles). Workforce Planning and Performance Management: Understanding how key performance data impacts the identification of critical job roles and talent segmentation.. Workforce Planning and Talent Acquisition: Identifying the supply and demand of both internal and external talent necessary to close talent gaps (e. Goalsetting processes ensure alignment with talent goals.g.

Competency Management and Performance Management: Competency models are used to identify and assess talent. populate performance plans. Northrop Grumman’s L&D led an onboarding program that fosters a positive new hire experience). define career paths. Competency Management. • • Capability and Competency Management • • • • • Talent Acquisition • • Bersin & Associates © September 2010 • Not for Distribution • Licensed Material .Talent Management Factbook 2010 103 Figure 56: Key Talent Integration Points – By Talent Process Area (cont’d) Talent Process Area • Key Integration Points Competency Management and Talent Strategy: One common job profile can be used to develop requisitions for sourcing. Talent Acquisition and Succession Management: Talent mobility programs that identify tools and resources for moving internal candidates throughout the organization (e. Talent Acquisition and Workforce Planning: Identifying the supply and demand of both internal and external talent necessary to close talent gaps (e. Talent Acquisition. reward and engage existing employees (e. Talent Acquisition and Total Rewards: Employee referral programs as a source of hire that identify top performers.. and recognize. during a down economy. Competency Management and Succession Management: A common “currency” used consistently by managers for effectively assessing performance and potential for defining succession plans. Talent Acquisition and Performance Management: Creating consistency between a job profile and a talent profile and providing an internal view of critical performance data necessary to identify top talent.g.. and Learning and Capability Development: An internal development program for engaging new hires before their first day of work and beyond the first six months of employment (e.. Southern Company’s center of excellence involves talent acquisition professionals in the workforce planning process to help close talent gaps).g. create development plans and plan for compensation. AmTrust enables higher retention rates and attracts 80 percent of its new hires through employee referral program).g. and Learning and Capability Development: Learning programs should be developed to teach to core competencies identified as critical for success in the company.g. organizations such as Fidelity Investments focus their talent acquisition efforts on talent mobility). which provides a gap analysis that helps leaders and employees understand the needed skills. abilities and behaviors required to be successful in different roles. Source: Bersin & Associates. 2010.. Competency Management and Talent Acquisition: Provides benchmarks and criteria for hiring the right people for particular jobs.

e-learning. abilities and behaviors required to be successful in different roles. compensation and promotion. Leadership Development.. To build the bench for critical professional / technical roles. • Leadership Development • • • • • • Succession Management • • Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . Succession Management. 2010. Source: Bersin & Associates. LD supports talent transition and assimilation into leadership roles (e. in part.” The potential of current leaders can be assessed and appropriate developmental plans can be put into action. experiences and knowledge acquisition. they provide a gap analysis that helps leaders and employees understand the needed skills. Succession management enables the identification of “future leaders. Succession Management and Performance Management: Performance management provides a wealth of data that is critical to identifying high potentials. Leadership Development and Performance Management: Helps organizations to identify where skills gaps exist among leaders. Leadership Development and Total Rewards: Supports the differentiation of high-potential development. Succession Management and Career Management: Organizations must be aware of employees’ career aspirations to be able to create sound succession plans.g. and assessing gaps in the company’s leadership and professional pipelines. a number of learning and delivery mechanisms must be applied. and Learning and Capability Development: Most sophisticated organizations have successful succession management programs. With this information. Succession Management and Leadership Development: Succession planning drives the prioritization of participants for leadership development programs. the leadership development team at NSLIJ provides input and guidance to recruiting to make sure that leadership assessments are available and that new hires are enrolled in the right career planning processes). and key projects and assignments.  Leadership Development and Succession Management: Supports succession and career plans. such as coaching. organizations can create relevant and timely training programs and developmental assignments for leaders. because their succession management processes include a development component. and Learning and Capability Development: When developing leaders.Talent Management Factbook 2010 104 Figure 56: Key Talent Integration Points – By Talent Process Area (cont’d) Talent Process Area • Key Integration Points Leadership Development and Talent Acquisition: For recruitment. the company should institute a strategy for successors to build functional proficiency through training. Succession Management and Competency Management: Competency models are used to identify and assess talent.

Source: Bersin & Associates. planning and forecasting. 2010. Performance Management and Career Management: Evaluation processes lead into career discussions and development planning to prepare for future roles. best-practice organizations create and track individual development plans as part of their performance processes. supporting both the company’s and the employee’s goals. an individual development plan is created. When these two processes come together. and Learning and Capability Development: Learning programs create opportunities for employees to enhance their capabilities. Career Management and Performance Management: In addition to performance ratings. as well as their connections with others in the organization. Performance Management and Workforce Planning: Evaluation processes provide detailed data for enterprise skill gap assessments. Assessment and evaluation data collected as part of performance management informs progress in the development of leaders. Performance Management and Leadership Development: People development skills as utilized in performance management processes are a major part of leadership development. Career Management. Performance Management. and Capability and Competency Management: Job role and / or competency mappings used in performance management processes are defined as part of competency management processes. Career Management and Competency Management: Competency management enables an individual or manager to embark on career planning. Career Management and Succession Management: Career development is reflective of an individual’s needs and succession management is driven by the needs of the organization. • • • Performance Management • • • Bersin & Associates © September 2010 • Not for Distribution • Licensed Material .Talent Management Factbook 2010 105 Figure 56: Key Talent Integration Points – By Talent Process Area (cont’d) Talent Process Area • • • Career Management • Key Integration Points Career Management and Talent Acquisition: Job postings systems that alert employees who have identified certain jobs or roles as part of their career plans. Performance Management and Succession Management: Assessment and evaluation data collected as part of performance management helps to highlight high potentials and informs readiness for advancement.

Learning and Capability Development. Completion of learning programs informs selection for succession-related initiatives. Learning and Capability Development. Total Rewards and Competency Management: Utilizing enterprise competencies to create pay range bands. Learning and Capability Development. and Learning and Capability Development: Including learning and development opportunities in total reward communications. and Workforce Planning: New hire and new-role training programs prepare employees for success at key roles. and Succession Management: Learning programs support career paths and succession plans. Total Rewards. and Talent Strategy: Talent planning drives strategic learning programs and initiatives focused on developing capabilities and addressing critical skills gaps. • • Learning and Capability Development • • • Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . Total Rewards and Performance Management: Performance ratings utilized to differentiate annual pay increases and ranges. Source: Bersin & Associates. Learning and Capability Development. Total Rewards and Succession Management: Differentiated compensation / total rewards packages for high-potential candidates. and Performance Management: Development planning processes drive involvement in learning. and Competency Management: Learning programs should be designed to develop all skills and competencies identified as essential for the organization’s key job roles. Completion of learning programs can inform compensation decisions. 2010.Talent Management Factbook 2010 106 Figure 56: Key Talent Integration Points – By Talent Process Area (cont’d) Talent Process Area • • • Total Rewards • • Key Integration Points Total Rewards and Workforce Planning: Flexible compensation / benefits packages utilized for critical talent segment hiring practices. Timing of such programs is a key factor for workforce planning efforts. Learning and Capability Development.

Talent Management Factbook 2010 107 Appendix III Table of Figures Bersin & Associates © September 2010 • Not for Distribution • Licensed Material .

2010 Figure 12: 5 Regional HR Business Partners + Head Office Figure 13: Talent Management Structure at Financial Services Company Figure 14: Relationships between Talent Processes Figure 15: McDonald’s Talent Management Structure Figure 16: HR Proficiency Ratings – U. 2010 Figure 11: Functions for Which the Talent Management Executive Is Responsible (among companies that have a dedicated executive) – U.S. 2010 Figure 19: Talent Management Maturity by Company Size – U.Talent Management Factbook 2010 108 Appendix III: Table of Figures Figure 1: Bersin & Associates Talent Management Maturity Model® Figure 2: Bersin & Associates Talent Management Framework® Figure 3: Integrated Talent Management Figure 4: Right Management’s Talent Planning Framework Figure 5: Talent Management Strategy – U.S. 2010 Figure 8: Percent of Organizations with a Dedicated Talent Management Executive – U. 41 13.S.S.S.S. 2010 8. 2010 Figure 7: Talent Management Strategy by Industry – U.S.S.S. Total 2008 to 2010 Figure 9: Presence of Dedicated Talent Management Executive by Company Size – U. 2010 Figure 17: Top Business Executive Drives or Actively Participates in Talent Management Strategy by Total and by Company Size (among companies that have a strategy) – U. 2010 Figure 20: Talent Management Maturity by Industry – U. 2010 Figure 10: Percent of Organizations with a Dedicated Talent Management Executive by Industry – U.S. 2010 Figure 21: Priority to Integrate Your Talent Processes by Total and by Company Size – U.S.S. 2008 to 2010 Figure 6: Talent Management Strategy by Company Size – U.S. 18 20 23 24 25 26 29 29 29 30 32 34 35 37 39 40 40 43 44 44 Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . 2010 Figure 18: Top Business Executive Drives or Actively Participates in Talent Management Strategy by Industry (among companies that have a strategy) – U.

S. Total 2009 (percent of employees promoted in 2009) Figure 37: Promotion Rates by Company – U.S.S.S.S.S. 2010 Figure 40: Impact of Talent Management Maturity on Effectiveness Measures – Areas of Highest Impact Figure 41: Impact of Talent Management Maturity on Effectiveness Measures – Other Talent Areas Figure 42: Impact of Talent Management Maturity on Total Turnover Figure 43: Impact of Talent Management Maturity on Voluntary Turnover Figure 44: Impact of Talent Management Maturity on High-Performer Turnover Figure 45: Impact of Talent Management Maturity on Promotion Rates 45 47 49 56 59 61 63 66 67 68 69 69 69 70 71 72 72 75 77 79 81 81 81 82 Bersin & Associates © September 2010 • Not for Distribution • Licensed Material .S.Talent Management Factbook 2010 109 Figure 22: Priority to Integrate Your Talent Processes by Industry – U.S. 2010 Figure 23: Business Development Bank of Canada’s Integrated Talent Processes Figure 24: Connections between Talent Processes – U.S.S. 2010 Figure 25: Boulay’s Path to Integrated Talent Management Figure 26: Sample Three-Year Talent Management Roadmap Figure 27: Example of Communications at General Mills Figure 28: Example of Talent Management Metrics Figure 29: Quarterly Metrics for Financial Services Company Figure 30: Human Capital Assessment and Accountability Framework (HCAAF) Talent Management System Metrics Figure 31: Turnover Metrics – U. 2009 Figure 33: Voluntary Turnover by Company Size – U. 2009 (percent of companies promoting 10 percent or more employees in 2009) Figure 38: Promotion Rates by Industry – U. 2008 to 2009 Figure 35: 2009 Turnover Metrics by Industry Figure 36: Promotion Rates – U. 2008 to 2009 Figure 34: High-Performer Turnover by Company Size – U. 2009 (percent of companies promoting 10 percent or more employees in 2009) Figure 39: Effectiveness Measures (self-rated) – U. Total 2008 to 2009 Figure 32: Total Turnover by Company Size – U.

104. Total 2010 Figure 48: Use of Automated Talent Systems – U.S.S.Talent Management Factbook 2010 110 Figure 46: Impact of Talent Management Maturity on Revenue per Employee – 2008 to 2009 Figure 47: Number of Talent Systems – U. 103. 105. 2009 Figure 49: Implementation Plans for Integrated Talent Systems Figure 50: Impact of Talent Systems on Organizational Effectiveness Figure 51: Impact of System Integration on Organizational Effectiveness (self-rated measures) Figure 52: Impact of System Integration on Talent Metrics Figure 53: Keys to Successful Integrated Systems Strategy Figure 54: Respondent Count by Company Size Figure 55: Respondent Count by Industry 2010 Figure 56: Key Talent Integration Points – By Talent Process Area 83 85 87 88 91 93 93 96 98 99 102. 106 Bersin & Associates © September 2010 • Not for Distribution • Licensed Material .

Bersin & Associates can be reached at http://www. More than 3.com or at (510) 654-8500. research-based services to help learning and HR managers and executives improve operational effectiveness and business impact. access to proprietary webcasts and industry user groups. With more than 25 years of experience in enterprise learning. strategic workshops. effective decisions. The information and forecasts contained in this report reflect the research and studied opinions of Bersin & Associates analysts. WhatWorks® and related names such as Rapid e-Learning: WhatWorks® and The High-Impact Learning Organization® are registered trademarks of Bersin & Associates. Bersin & Associates research members gain access to a comprehensive library of best practices. and strategic consulting to improve operational effectiveness and business alignment. All rights reserved. Bersin & Associates provides actionable. or reused without written permission from Bersin & Associates.500 organizations in a wide range of industries benefit from Bersin & Associates research and services.bersin. No materials from this study can be duplicated. republished. Bersin & Associates © September 2010 • Not for Distribution • Licensed Material . copied. benchmarks and in-depth market analyses designed to help executives and practitioners make fast. case studies. technology and HR business processes. About This Research Copyright © 2010 Bersin & Associates.Talent Management Factbook 2010 111 About Us Bersin & Associates is the only research and advisory consulting firm focused solely on WhatWorks® research in enterprise learning and talent management. Member benefits include: in-depth advisory services.

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