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Talent development 2021: Ten changes that companies have to face now

The digital transformation of companies depends largely on their ability to learn. In terms of new technical competencies on the one hand, but on the other hand and maybe even more importantly, in terms of how they deal with the people in their organization. Identifying and developing skills, making knowledge accessible, fostering talent, and creating a culture of collaboration at eye level and of shared learning may currently seem like an insurmountable task, but it is absolutely feasible if supported digitally and, more importantly, culturally. Employees do not need to be taken by the hand at every step of their career. Instead, they need the freedom to learn according to their needs and alongside their colleagues, and to advance their careers based on their own ideas and skills. The result allows companies to grow, not just internally but beyond their limits, into a living organism that is capable of adapting to new circumstances and challenges from outside.

How do companies achieve this? Which developments should they be aware of and use for their benefit? – We have summarized what we consider to be the ten most important developments in the field of talent development.

1. Individualized career for life instead of job for life 

Digitization leads to constant changes to the tasks and requirements within companies. In areas where mechanical and routine work is increasingly being automated, many jobs are being eliminated altogether. But also employees in communications, marketing, or HR have had to and continue to realign themselves. It is no longer a question of hiring people for a job that they will do for the next 30 years or more, but rather of taking them on a “career journey” whose destination is not yet clear, but during which there is a great deal to learn and discover. The motto in career planning for the present and future is: the journey is the destination. To enable managers to shape this journey together with their employees, they need to get to know their skills and talents. Only then can they make connections between previous job profiles, newly discovered talents, and roles that will become important in the future, thus creating opportunities for reskilling initiatives, for example.

2. Tangible trust retains talent

The Global Talent Report 2020 by Mercer has impressively demonstrated what an important role mutual trust between employees and managers plays for talent development in companies. Employees who feel they can develop within the company, who have good working conditions, and are feeling happy overall are eight times more likely to stay with the company, even if their area of responsibility changes significantly. The figures also show that the majority of employees trust that their company will prepare them well for future challenges and provide them with appropriate learning opportunities. This is a show of trust that companies should not squander if they want to retain talent.

3. Learning Mindset: Learning on the job

For companies, developing a “learning mindset” means recognizing that learning is not an annoying “add-on” that becomes necessary now and then to be able to operate the next new tool. In the digital age, learning is a constant. It needs to become part of a company’s DNA, of job profiles, and daily work life. To achieve this, task areas should be simplified and every employee should be given the space needed to acquire new skills. Companies as a whole must become open to new experiences, allow for trial and error, and acknowledge the fact that they cannot plan and know everything, but are encouraged to be all the more curious.

4. Detect and use potential where it becomes visible

“We have concentrated IT expertise in-house.” is a statement to which companies can certainly be congratulated. But it is even more important for organizations to know who exactly you can turn to for help with very specific IT questions. In the future, it will be even more important to know each employee with his or her specific skill set and to connect competencies in a targeted way. None of this has to be controlled and coordinated centrally from the top down. On digital talent marketplaces, employees can simply post their skills and learning needs and be matched with suitable colleagues to join forces in tackling a certain challenge. Smart interfaces between these marketplaces and digital learning management systems can then serve as a catalyst for upskilling and reskilling within the company. Projects can also be advertised via said tool and staffed with exactly the right people within the company, namely those who have the right skill set and are keen to work on a specific issue.

5. New experiences instead of traditional career planning

The traditional career ladder is increasingly being replaced by a career network that stretches in all directions and where employees can freely choose the direction they want to take. No path is a one-way street. Instead, new experiences and team constellations await at every junction. Depending on their tasks and skills, employees can temporarily take on leadership responsibilities in certain projects, regardless of their position or job title. The employees themselves and the organization as a whole are constantly weaving new connections, opening up new areas of responsibility, and identifying the appropriate skills and roles needed to fill them.

6. Agile Teams

“Agile” is one of the major buzzwords of digital transformation. It is interesting that many companies do not focus so much on agile processes and work practices, but see a much bigger opportunity in agile teams that come together as needed. And in agile employees, who are constantly evolving and willing to learn new skills as their previous scope of work changes or disappears altogether. Meanwhile, many organizations underestimate the agility of their employees. According to the Mercer study, while the executives surveyed said that, in their estimation, only 45 percent of the workforce is truly agile, 78 percent of corporate employees surveyed said they were willing to retrain and take on further education for a new role within the company. So there is not a lack of will but mostly a lack of concepts for how agile teams can be developed to flourish.

7. Reskilling first, upskilling second – recruiting third.

Currently, many companies are focusing on upskilling, i.e. expanding existing skills, and in particular on developing digital competencies. But that alone is not enough. In the Mercer study, 65 percent of HR leaders stated that they would not be able to find the talent they will need in the future on the open market, even if they continue to adjust salaries upward. Reskilling, i.e. equipping existing employees with new skills, is therefore becoming ever more important. 76 percent of companies said they are looking for talent internally and developing it specifically towards new areas of responsibility. This not only brings movement into the workforce but is also a wonderful opportunity for employees to stay with the company, even if their current area of responsibility is possibly eliminated in the future.

8. Working in roles and gigs

Fixed job descriptions are often too rigid for the rapidly changing environment in which companies operate. A sensible counter-strategy is to enable all employees to work much more in projects, roles, and gigs. To do this, these need to be accessible via an open “marketplace of opportunities.” Employees need the freedom and tools to apply for short assignments and projects on their own initiative and based on their skills (these are often not known within the company). There is still a lot of work to be done here. According to the Mercer survey, only 26 percent of companies offer short assignments and internal gigs at all. Only slightly more than half of the employees surveyed said they had easy access to these opportunities. Facilitating this is a management task, and one of the most important in the near future, combined with a motivating environment in which employees dare to and feel like trying out new roles and growing through them.

9. Thinking people, transformation & business together

It is no longer a question of “people OR business” or “transformation OR business” or “first transformation, THEN people”. All three areas must always be thought of together. CEOs should be measured by the emphasis they put on the further development of their employees, how many successful reskilling measures have been implemented, how many employees whose jobs have been eliminated have taken on new and promising tasks. Developing your employees is a business case! And it lies at the heart of digital transformation. Without a cultural shift, without a mindset of learning, without broad access to learning opportunities, roles, projects, and gigs, without openness and humanity, the technological change can hardly be managed.

10. Companies need IQ and EQ

Making smart business decisions is one thing. Building human organizations is another. And in the future, it will become increasingly difficult to do the former without also considering the latter. Companies have to understand that they can not simply coexist alongside their employees, but that they are their most valuable treasure. Amenability, humanity, the principle of “being at eye level”, and sustainability in terms of work models, development opportunities, and ethical production and utilization chains are already incredibly important today and will become even more so in the future. A study in Germany with 28,000 employees during the Corona crisis showed that many employees are considering changing jobs because they no longer find meaning in them or are burned out by them. These figures should be a final wake-up call for companies. They decide which path they want to pave for their employees: the path that leads out of old structures and into new tasks and roles within the organization – or the path that leads out of the organization, along with all the skills they haven’t even had the chance to discover and use.