Solar Industries LTD has grown from a small entrepreneurial venture founded over 50 years ago into a large engineering company based in Farnborough. It has experienced expansive growth over the last decade and its specialized prODucts for the electronics industry are exported to about 40 countries around the world. It is considered a market leader with an internationally recognized product brand. Within the firm, the strategic direction of product and technology development is guided by a ‘technology roadmap’ developed by senior management. While engineers lead the technological aspects of product development, decisions on new product ideas and concepts are governed by senior executives.
Approximately 1,500 staff are employed. Skills shortages at all levels in the organization are severe. Right up to senior management, people with the sort of experience needed at Solar are much in demand and it is increasingly difficult to find good replacements. Labour turnover levels are high – last year they were 18 per cent for managers, 17 per cent for engineers, 20 per cent for sales and marketing and 15 per cent elsewhere.
The HR department is led by a young hr Director, whose team consists of a Head of HR Services, a Head of Learning and Development and a Head of Resourcing. A high-performance work system (HPWS) – a model of its kind – is in operation, the mAIn features of which are:
● High-invoLVement practices, which include extensive communication on company plans and results, participation in reviewing key business and people issues, regular staff surveys and a focus on continuous improvement.
● Integrated HR practices consisting of performance management (including 360-degree assessment), workforce planning linked to business strategy, formal assessment tools for recruiting, structured induction training and continuous skills development programmes.
● A total reward approach with a career family grade and pay structure, contribution-related pay, employee share ownership scheme, profit sharing, flexible benefits, a recognition scheme and family-friendly policies.
In spite of all this, things are clearly not going too well, as indicated by high labour turnover rates, recruitment problems, succession problems (managers at all levels and team leaders) and some doubts about the leadership skills of the relatively inexperienced people who have had to be appointed. It is noticeable that insufficient attention is BEIng paid to management development or succession planning.
The HRD had heard and read a lot about talent management but had tended to dismiss it as just another fad. He now realized that there was perhaps something in it for Solar, given the talent problems the company was facing. He therefore decided that he had to establish what talent management could mean for Solar, and, if there were something in it, how it could be developed and how it would benefit the company. He mentioned this at a Board meeting and was encouraged by the Chairman to look into it and come back with some ideas.
As the HR Director, produce an aide-memoire as the basis for a presentation to the board on what talent management could do for Solar and how it might be organized.
The concept of talent management can be a bit fuzzy. There are a number of questions that need to be answered:
● Is it just about the top 10, 5 or even 2 per cent, or is everyone regarded as being talented?
● Is it just management succession planning under another name (new wine in old bottles)?
● Or is it just management development (again, new wine in old bottles)?
● Or does it embrace every aspect of resourcing in its broadest sense – ie workforce (human resource) planning, recruitment, retention and development? And if so, what’s new?
● Is it about creating ‘talent pools’ and what, in any case, are talent pools?
● Is it necessary to have a designated Head of Talent Management and what could he or she do that cannot be done by existing HR professionals?
● What is potentially the added value that a systematic approach to talent management, however defined, could provide? Or to put it another way, what is the return on investment in talent management?
● How, and this is the $64,000 (or much more) question, would talent management support the achievement of the business goals of Solar?