Managing talent: 3 strategies to overcome a skills gap and create competitive advantage


By Joe Marzano


The greatest challenge facing most employers is finding and keeping talent


This has been a top concern for decades across industry sectors and markets, and is reflected in many surveys, news stories, and conversations.

According to a 2013 study by the staffing company Manpower, over a third of global employers and nearly 40% of U.S. employers said they were having difficulty filling jobs.  Over half of employers said a talent shortage was impacting their client-facing abilities, and four in ten said it reduced competitiveness and productivity.

Similarly, a U.S. Chamber of Commerce study found that over half of leaders at smaller businesses said they face a challenge in recruiting non-managerial employees, and a survey of Inc. 5000 CEOs reported that over 75 percent considered finding qualified people to be a major problem.

The U.S. unemployment rate was 6.3 percent through April 2014, down from 7.5 percent a year earlier, yet there are still nearly 4 million unfilled openings.

Debating the Problem of a Skills Gap

The debate about why there is an ongoing hiring problem tends to focus on the premise that there is a widespread skills gap, and blame for a skills gap centers around a few areas.

Some blame the formal education system for raising unrealistic expectations that a degree is a “ticket to success”, lowering student learning standards and practices, and failing to keep up with a changing global economy to deliver competent graduates with currently relevant skills. The truth is that not all educational institutions and programs are equal or deliver the right learning for anyone, a diploma or degree is not proof or guarantee of applicable skill or practical experience, and the adage “buyer beware” applies as much to a student’s investment in their education as to any other consumer purchase.

Some point to modern society’s supposed declining work ethics and values, the impact of technology’s effortless access and self-promotion in flooding and overwhelming employment searches, and changing popular perceptions of “dirty hands vs. clean hands” industry careers. The truth is that since ancient times adults and youth have complained about each other, and people have continuously adapted to evolving tools, attitudes and habits about work and career.

Others say that employers set expectations that impose on educator’s freedom to teach, rely on narrow selection criteria and online tools that filter out potential talent without desired keywords and titles, have cut investments in training and apprenticeships that would teach and coach to their standards, and fail to align competitive compensation and cultural criteria that attract and keep ready workers. The truth is that hiring and retention experiences vary widely depending on employer attitude and commitment, their enterprise size and scale, and their particular marketplace.

For many reasons, there may be a skills gap for some roles. For many employers a larger issue is how they assess and approach talent needs, overcome conventional hiring processes that may miss potential, apply relevant learning that keeps talent current, and slow or stop the costly revolving door of wrong fit hiring.

Three Strategies to Overcome the Talent Challenge

Here are three strategies that can help you overcome a perceived “skills gap” challenge, and instead create a competitive talent advantage:

1. Start by Seeking Solution
Employers that report talent shortages tend to focus first on building a high skill talent pipeline. Often the last person to hold a role defines the hiring criteria and the candidate competencies that are sought. In addition, many organizations do not match talent needs with strategy.  A 2013 survey by Forbes of 311 private companies with annual revenues of from $50 million to $500 million found that less than half had aligned talent management with
strategic planning.

Recruiters screen candidates for hiring (buying) authorities who will use the talent. Regardless of whether they are inside staff or outside contractors, recruiters are motivated and rewarded to present prospects that match the hiring authority’s exact specifications. While some recruiters are equipped to help clients review job descriptions, most are focused on complying with and fulfilling their assigned search parameters.

As a result employers may end up replacing a replica of the previous person, and miss finding high potential talent with the right role capacity needed for the future.

The most successful hiring authorities start by considering their organization’s
strategic direction and desired outcomes, and then work backward to craft talent needs that align with and support future goals. They redefine candidate qualifications that may have changed or evolved since the last time the role was filled. In addition to seeking measurable and tangible task competencies and behaviors, they search for signs of less measurable yet essential values and beliefs that define their organization’s cultural integrity and influence a worker’s future behaviors within that culture.

A national consumer service corporation, with over 70 division presidents operating under four branded systems, assigned me as chair for a project team chartered to review, redefine and map role competencies that drove presidential performance. Our accomplished project team included the chief executives of the four brand systems, officers of the national corporation, and several seasoned division presidents.

We soon discovered that the existing division president role definitions were outdated, not aligned, and missing key indicators of success. For example, easily measurable performance metrics such as financial volumes and margins, customer growth rates, practice efficiencies and other lagging indicators were included. However, there were no defined responsibilities or accountabilities for driving customer satisfaction or brand integrity, which were key differentiators and mission-driven values of the national corporation and each brand.

When I pointed out omissions like this, and suggested related new criteria for future hires, the executives were both surprised by their oversight and in agreement of the added value. Despite years of experience they were unable to see what was missing. With my help they became ready to step back, adopt a new perspective to move forward, and create comprehensive future-focused role definitions and criteria used across the corporation.

If you find you are replacing replicas and struggling with standards, step back and take time to re-examine your situation, goals and needs before starting to solicit recruiters for candidates.

2. Adopt an Acceptable Paradigm
Faced with too much choice people tend to become anxious, overwhelmed and hesitant to choose. Seeking the illusion of securing a perfect match, they can miss making an acceptable decision that still leads to great things. Both employers and workers face a similar paradox of choice in today’s job market.

Narrow employer standards limit possible fits while extending hiring cycles, increasing productivity and performance “down time”, and raising unrealistic expectations on finally selected hires.

Workers with broad ambitions fit in where possible while looking for the next best thing, without committing to make the best of where they are. They spam employers with resumes and cheapen their perceived value. Chasing better fortunes they miss seeing and polishing possibilities in hand.

There are limits to available “best in class” options, and a diminishing return in holding out for perfection. Selecting “good enough” delivers immediate value and compounds future return. It is easier to make a good situation better than to make a bad situation good, just as it is easier to lead and develop a willing but under-skilled worker than a highly skilled but unwilling worker.

Having excellent standards and practices is important. So is having a clear view of what you need to achieve and the relative return on investment between picking perfect and adopting acceptable.

3. Treat Talent with Talent  Most organizations understand the value of keeping existing customers compared to the cost of acquiring new customers, yet many do not apply this same thinking to their workforce even when finding fresh qualified talent is a challenging investment.

Worker turnover (including “right sizing”) reduces productivity, overworks and stresses surviving staff, loses knowledge and experience, and creates recruiting and interviewing costs. By some estimates the total cost to replace a worker can range from 15-20% of annual wages for entry-level workers to as much as 150-200% of a year’s wages for top executives.

As a result high turnover often becomes a vicious cycle of decline and talent deterrent, while low turnover becomes a virtuous cycle of improvement and talent attractor. Being an employer of choice is much better than being an employer to avoid. The difference is in how you see and treat talent as a policy of priority and practice.

While every employer’s circumstances are different, there are a few common practices that help in holding onto talent by treating them as the valued investments they really are.

First, apply the previous two strategies to
engage your existing workforce. Re-assess and where necessary redefine all roles, at least annually. Seek to fit the right people to the right tasks and responsibilities, which will improve performance and satisfaction while driving future results. Polish what you have in hand knowing that investing in improvement usually delivers a better real return than replacement.

Second, look beyond current competency and collected experience to future capacity and willingness to learn. Help existing workers to increase their readiness to do more and be better, starting by assessing and developing the capacity of your leaders to teach, coach, support and encourage better workers. Then engage performance teams in activities and projects where they collaborate, learn mutual respect and responsibility, and accomplish great things together.

For example, I have created and led many effective leader and worker team retreats and events where groups participate in
fun practical learning experiences designed to build trust, confidence, commitment and accountability toward common goals. Getting people out of their comfort zones and away from distractions and confines of work, both physically and figuratively, creates a climate for breakthrough thinking and innovation often beyond expectations.

Third, create and apply an organized and purposeful on-boarding agenda that engages, acclimates and integrates new workers as champions and advocates of your culture and mission. This is especially vital for high-impact specialized talent and senior leaders who must quickly make a positive contribution, and need a structured program that key stakeholders are committed to support.

Years ago I created a 90-day on-boarding plan and agenda for my own new employees, and have used it for myself when my new employers were unprepared with one. Today I offer my clients help crafting and implementing their specific plans. Using a tested on-boarding process will help to quickly get talent grounded and moving forward faster as valuable contributors.

Fourth, consider how your work environment and career opportunities matter and make meaning, so that people will choose to stay. Factors like these are beyond basic compensation and benefits offerings, and are especially important to younger workers.

If your organization has been struggling to find the right talent, you do have choices in starting to seek solutions, adopting acceptable paradigms, and treating talent as a priority.

Assess your approach to talent needs, change hiring practices to increase potential prospects, apply relevant learning to keep current, focus on retaining existing talent, and seek outside help where necessary to overcome your “skills gap” and create a real competitive talent advantage.

To learn how to apply these strategies and to receive a free initial consultation,
write to us at info@martiusgroup.com

© 2014 Martius Group, LLC

A successful organization is recognized by the people it keeps, and not by the talent it recruits.

"Focusing a hiring formula only on skills and deeds acquired through training and experience misses the human strengths that produce consistent and persistent performance." - Joe Marzano