Competitive advantage is one of the most popular concepts talked about today – both online and in business circles. What exactly does it mean? We know it refers to an organization’s ability to outperform its competitors, lead with an edge over its rivals while generating greater value for the firm and its shareholders.
Yes, business is all about head-to-head competition. Companies regularly compete for market share in any variety of ways including product design, quality, pricing, distribution, branding, marketing, etc. The objective is ultimately to drive sales, develop loyalty, ensure sustainability, escalate market evaluation and maximize profits.
What does this all boil down to? It’s pretty obvious, isn’t it? When a company enjoys a competitive advantage it is because of their ability to attract, hire, develop and retain the talent that makes it all possible.
“Best employer” companies are characterized by management who passionately believe the bottom line is driven by human endeavor.
The Organization’s Competitive Advantage
The human element within every company provides skills, experience, creativity, motivation and values to the business. These contributions ultimately generate market position and allow an organization to successfully compete in the global economy.
Strategic and effective hiring compliments and improves an existing workforce as well as secures the people who will add long-term value to the organization. Smart hiring plans should never simply replace lost assets. Hiring plans must ensure the business doesn’t forfeit an opportunity for improvement.
Businesses are transforming and this requires new skills. Companies are rethinking their business models and organizational approaches. Digital knowledge, agile thinking, interpersonal and communication skills, and global operating capabilities will be talent areas in high demand over the next five to 10 years.
When not approached strategically, finding and hiring the right employees can be an elusive aspiration and a very drawn-out process.
Talent is the Epicenter of Competitive Advantage
In years gone by, an organization’s value was primarily evaluated in hard goods. Measuring a company’s value in inventory and equipment made total sense. Today we exist in a knowledge-based economy – the utilization of talents, knowledge, skills and abilities. This is the true value of any organization.
I recently came across an excellent example that clearly demonstrates how our knowledge-based economy today is viewed. When Microsoft is valued at $250B, its physical assets may only be $8B. The difference in value is made up in the worth of their talent – this includes the Microsoft employees. The company’s intellectual capital is valued at $242B!
Talentism IS the new capitalism.
Talent = Knowledge
Each organization is made up of people – great people, good people and below average people. The strongest teams exist when the highest percentage of their members are great people. These teams then become the company’s biggest overall asset.
Great people are five times as valuable as good people. This is especially true when the great people are technically skilled, creative and innovative talent. In today’s market, just throwing bodies at a problem or attempting to company goals is not the answer. This was a lesson learned in teh dot com period, which was quickly followed by the dot bomb phase.
A few great people will actually accomplish much more than several simply good people – at all levels within the organization.
Sometimes less is more.
Talent Defined
What do we think of when the term “talent” is used in a conversation? Do we think of Einstein, Mozart, Picasso, Spielberg, Streep or Hawkins? Twenty years ago, these kinds of individuals were labeled “Top Talent”.
Obviously there are people who are in a league of their own. We must not forget that there are many talented individuals who are AAA – (well) Above Average Ability. Sometimes they may be a subject matter expert and other times they may be so adept, quick and innovative that they become the “problem solver extraordinaire”.
The Talent School of Thought
There are two ways to view talent-
- People are born talented; it is something that is innate
- Talent is a skill that is acquired, developed and honed
This is a discussion that is important to have because it leads to how an organization chooses to recruit talent. NOTE: If a company believes that talent is developed, how much money are they willing to budget and spend on growing it?
In either scenario, talent is a recurring pattern of thought, feeling, or behavior. It is a special ability that allows someone to do something well and with the capacity for successful achievement of a goal.
It is commonly accepted that there are two fundamental truths about great talent.
- They only want to work with other great people.
- Great people feed off of each other in person.
Knowing these two facts can sometimes complicate bringing new employees onboard. Do the new employees meet the bar that has been set? Will they support the performance of the team or reduce the perceived standards?
A talent is a person who possesses special skills, which are very difficult to copy or imitate.
Meeting THE Talent
Every company needs high-impact talent with technical skills, business acumen, domain and industry knowledge and experience. The reality is that the demand for professionals with ‘everything’ in one package is not always very realistic.
Hiring Managers are feeling the pressure and are challenged finding candidates with the right combination of skills and industry expertise – at the right time. AND, they are making the lives of the HR Team more complicated. Candidate talent pools are receding and Hiring Managers are forced to stretch their budgets. There is always an increased emphasis on salaries when it becomes necessary to wade deeper and further out into the pool to find THE talent.
Simply put, there aren’t enough great candidates meet all of an employer’s expectations with the number of high demand technology and business positions available. A recent healthy economy with low unemployment rates has further complicated the situation – with the exception of the oil patch in Alberta.
Often times, working with a skillful and trusted business partner can help short circuit the need. Professionals who meet and speak with talent on a regular basis can offer both insight and act as a Talent Scout on a company’s behalf. It is no surprise that the most desirable talent is not readily available when needed because the talent pool has been dramatically drained without a lot of restocking taking place.
Successful hiring is one of the key factors to operational success for large and small businesses alike.
A search partner can be a true asset.
Talent is NOT an Online Commodity
Some believe that talent is online and ready for the picking. That is what many companies that sell access to their networks promote. LinkedIn is just one example. It’s true, technology and social media may have made candidate identification somewhat easier, however candidate recruiting and hiring has actually become more challenging and difficult.
Recruiting is more about maintaining and leveraging relationships than advertising job postings. Wooing, courting and engagement doesn’t happen online. Recruiting relies on uniquely human skills.
It takes human chemistry, time, practice, experience and business skill to make things happen. Unfortunately, due to the proliferation of social media, many of these skills have been either lost or never properly developed.
In Closing
Since we are presently in the middle of the 15 day celebration of the Chinese Lunar New Year, it just feels appropriate to include a quote from Laozi, the founder of philosophical Taoism.