What is talent optimization?
This article originally appeared here on The Predictive Index blog
Take a good hard look at your company. Is it performing at its absolute best? If you’re like most leaders, you struggle to overcome common business challenges like turnover, employee disengagement, a changing market, bad hires (the list goes on and on). In spite of your best efforts and your best intentions, you can’t quite accelerate your company’s performance.
If you can relate to this everyday scenario, you likely struggle from a talent gap. This gap causes low productivity, poor results, and missed opportunities—it’s the reason why most companies fail to perform at their highest potential.
If you’re tired of falling short, talent optimization is the answer.
What is talent optimization?
Talent optimization is a four-part discipline that details what’s required for aligning your business strategy and your talent strategy so you can achieve your desired business results. At the core of talent optimization is the collection, analysis, and application of people data.
There are four aptitudes you must master to ace talent optimization:
- Diagnose: You’ll measure your people data, analyze that data, and prescribe remedies as needed.
- Design: You’ll create and evolve your people strategy.
- Hire: You’ll use people data insights to hire top talent and build high-performing teams.
- Inspire: You’ll use people data to drive important employee-oriented activities.
Before we dive into each of the four aptitudes of talent optimization, it’s important to first understand the discipline’s four essential truths.
Four essential truths of talent optimization
The strategic discipline of talent optimization is grounded in four essential truths. Before you attempt to roll out talent optimization within your company, take the time to understand the following:
1. Business context frames talent optimization.
Talent optimization is informed by business strategy and it produces desired business results. In this way, business context “wraps” talent optimization. It provides essential context that will guide everything you do, from designing your organization’s structure to evaluating the abilities of your senior leadership team.
Here’s a visual to show how business context wraps the talent optimization discipline:
2. People data drives talent optimization.
When business leaders put people analytics front and center, they can make informed, objective decisions (and reduce unconscious bias). People data helps leaders to predict workplace behavior so they can hire the right candidates, design goal-crushing teams, cultivate an award-winning culture, and manage employees according to their unique preferences.
3. Everyone in the organization must embrace talent optimization.
As powerful as talent optimization is, it won’t be effective if it’s only used by HR or the C-Suite.
It must be rolled out to and adopted by every employee across the organization. When you do grant people access to people data, you’re giving them the gift of self-awareness and a healthier workplace.
4. Talent optimization protects against the four forces of disengagement.
When people are engaged, they go above and beyond. When people are disengaged, they do the bare minimum. In this way, disengagement and productivity go hand-in-hand. We’ve pinpointed four forces that disrupt employee engagement:
- Misalignment with the job: Employees lack the behavioral traits or cognitive ability needed for on-the-job success.
- Misalignment with the manager: Managers lack critical skills or tools to effectively coach and develop employees.
- Misalignment with the team: Teams can’t communicate or collaborate—and tension colors interactions.
- Misalignment with the culture: Employees have trouble connecting with company culture—or culture is toxic.
Companies that optimize their talent always consider these four factors when making any decisions that involve people. For example, talent optimizers use behavioral assessments and cognitive assessments as part of the hiring process to ensure candidate job fit.
Talent optimization is made up of four aptitudes.
As we mentioned earlier, the discipline of talent optimization comprises four aptitudes: diagnose, design, hire, and inspire. Now let’s take a closer look at each one.
By diagnosing, a leader can pinpoint the true cause of a business’s talent gaps. Many of our common business challenges are really people problems underneath. We’ve identified four forces of employee disengagement—and when these aren’t corrected, they manifest as high turnover, not meeting sales goals, bad hires, toxic culture, etc.
Ideally, you’d diagnose preventively to stay ahead of any brewing problems. But the reality is that you’ll likely need to diagnose when problems start brewing, too. To uncover the root cause of your business problems you’ll need to do the following activities:
- Measure what matters.
- Analyze the evidence.
- Prescribe improvement actions.
These three activities repeat in a loop. By completing them, you’ll unearth insights that will lead you to make changes to the way you design, hire, and inspire within your company.
It’s important that you design your organizational structure, senior leadership team, and company culture intentionally—and you want all three to align with your business strategy. Too many companies build teams without first stopping to consider team dynamics. What’s more, they put people in management positions simply because they’re good workers even when they lack the self-awareness to be effective leaders. These companies are making a muck of their businesses—but it doesn’t have to be this way.
The design aptitude is where you’ll complete the following activities:
- Select your organization’s structure.
- Evaluate your leadership team fit.
- Understand senior team dynamics.
- Establish your culture.
When you do these four activities intentionally and strategically—supported by data—you’ll be in a much better position to shift your company into a higher gear.
Poor job fit and poor team fit are two of the four key factors that disrupt employee engagement and productivity. That’s why hiring the right people and placing them on the right teams is such a critical activity.
By following a prescriptive plan for defining the job and then using behavioral and cognitive assessments to evaluate your candidates, you’ll improve your hiring outcomes. It’s like having a superpower to see beyond the surface and predict on-the-job success.
The hire aptitude is composed of the following activities:
- Define and communicate job requirements.
- Equip your leaders to land top talent.
- Predict new team dynamics.
- Determine candidate cultural fit.
When you nail hiring, wonderful things happen. People feel energized by their jobs and their teams and go the extra mile. Performance and engagement soar. You delight your clients and boost your brand reputation—and as word grows about your winning ways, it attracts other top performers.
The 2019: State of People Analytics report found that more HR leaders are realizing the power of using workforce analytics to improve hiring and management outcomes, yet obstacles stand in the way and prevent them from harnessing that power.
Most employees don’t have access to people data insights that would help them be more self-aware of their workplace behaviors and work better with their teammates. A talent optimization approach gives employees the tools they need to address communication problems and other issues that pop up when working collaboratively.
Inspire includes four activities:
- Create new jobs and career paths.
- Develop your leaders.
- Create high-performing teams.
- Reinforce your culture.
While designing strategically and hiring smart are both critical to your business success, you can’t end your efforts there. The most successful companies know they must continue to inspire their employees and protect their culture as time goes on. When teams gel and everyone feels inspired by the company culture, magic happens.
Why is talent optimization needed?
Companies create a business strategy and determine what business results they want to achieve—but then they glaze over the critical “people” work that should be happening in between. They fail to intentionally, consistently, and strategically design high-performing teams and company culture. They fail to manage people in a way that pushes them to be their best. And they fail to make intelligent human capital investments despite proof that employees must be invested in and developed to maximize ROI.
As a result, these companies end up suffering the consequences of the talent gap. Their teams are fraught with tension, their employees are unhappy, their top performers up and leave. People are a company’s greatest (and most costly) asset, yet companies aren’t empowering their people to perform at their max capacity—because they don’t know where to begin.
Talent optimization is a discipline that helps leaders close the talent gap and solve their business problems once and for all.
And it’s scalable and repeatable, so you can always stay ahead of the curve to stave off any issues that seem to be brewing.
Who’s responsible for talent optimization?
HR professionals are generally tasked with anything related to talent management. But the typical HR employee doesn’t have the knowledge or resources needed to successfully close the talent optimization gap. This is why you, as a strategic business leader, need to step up and take responsibility for putting your talent in the optimal position to get the results you want.
When you keep making the same mistakes you can’t blame HR. Doing so will only cause friction to bubble up. Instead, put yourself in the driver’s seat and be a change agent for the good of your company—and for the good of each individual worker.
Educate yourself on how to align your employees with your business strategy, and arm yourself with talent optimization tools that provide you with people data insights. This way you can take a data-driven approach to hire the right people, design your culture, diagnose engagement levels, and manage employees effectively.
Want to close the talent gap once and for all? With talent optimization, you finally can.