Human Capital Management

This extracted from a recent Economist article ....

During the relatively modest downturn at the start of this decade, many professional-services firms cut too deeply, especially in their lower ranks, and found they were poorly positioned when strong growth resumed sooner than expected, says Heidi Gardner of Harvard Business School. Firms built on pyramid structures in which senior managers mentored larger numbers of employees below them suddenly found that, in a growing economy, they lacked the mentors needed to manage the army of new recruits. Instead, they had to re-hire ex-staffers at higher salaries and, in some cases, abandon proven policies of hiring senior managers only from within, says Ms Gardner, who worked for McKinsey at the time.

This crisis is revealing how few firms have really thought through their talent strategies, says Mark Spelman of Accenture. Claims that 'our workers are our most valuable assets' are too often platitudes, the emptiness of which is now being revealed. But those firms that have thought seriously about their talent needs have the opportunity to get ahead of those that haven't, says Mr Spelman, not just by shedding poor performers but also hiring scarce talent from outside, in what is now a buyer's market. Other tips from Mr Spelman include avoiding voluntary redundancy programmes, which encourage the most employable people to quit, and not firing the newest recruits on a crude first in, first out basis, as this cuts off the supply of future talent. Instead, firms should identify which workers they need to keep, and do what they must to retain them.

Haven't found the article in full other than here ....



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