posted on 9/28/2011 2:13:46 PM
Research from Aberdeen shows that best-in-class companies practice a brand of human capital management that focuses on skills identification, talent retention, and happy managers.
Against the backdrop of persistent high unemployment and what some in the manufacturing industry have called a debilitating skills gap, researchers at the Aberdeen Group recently set out to create a profile of companies with best-in-class talent acquisition and human capital management practices.
Over the first eight months of the year, Aberdeen surveyed more than 500 companies across the spectrum of industries, and graded them on their ability to hire and retain valuable employees, hallmarks of strong human capital management. Aberdeen defined best-in-class HCM companies as those that scored in the top 20% on a series of HCM-focused metrics, while companies deemed average in their HCM abilities sat in the middle 50% of the respondents. Laggards occupied the bottom 30%.
Among best-in-class companies, Aberdeen found three common traits. The first appears straightforward, and most manufacturers would likely rank themselves highly on the measure: “The ability to define the talent required by business needs in terms of skills, behaviors, and attributes.” The second trait exhibited by best-in-class human capital managers is a “culture of talent acquisition, where everyone views finding great talent as part of their job.” Such a culture may be more prevalent in a Silicon Valley company such as LinkedIn, one of the report’s sponsors, than, for instance, in a manufacturing company in America’s heartland.
The final defining quality of HCM exemplars is a “focus on building relationships and talent pools around critical roles that have the greatest impact on organizational performance.” Some research has shown that manufacturers, in particular, could do a better job promoting educational paths that would boost the industry’s skills profile. Others, including recent winners of Progressive Manufacturing 100 Awards, have taken matters into their own hands to develop the next generation of manufacturing worker.
As for the specific metrics of HCM mastery, best–in-class companies retained at least 95% of their first-year employees. Among those hired in the past year, 82% had met their performance milestones on time, Aberdeen found. Leading companies also averaged a 16% year-over-year boost in manager satisfaction, according to the study.
Among companies that displayed average HCM abilities, the variance in the three performance metrics was stark. Among that group, just 57% of first-year employees stayed on, and only one in three met performance milestones on time. Managers reported a 3% improvement in satisfaction, compared with the 16% gain enjoyed by managers at HCM leaders.
As average and laggard companies seek to move upstream, Aberdeen analysts suggest that they work on a number of fronts, including:
• Give hiring managers visibility into candidates’ information during the recruitment process
• Clearly define core competencies for specific positions
• Establish the various responsibilities that govern the employee onboarding process
• Home in on the skills that are critical to the company’s success
• Localize their recruiting
Tools that can facilitate those objectives, Aberdeen said, include job portals, candidate background checks, software that determines employee eligibility, a hiring management system and applicant tracking program, and pre-hire assessments.
The full report can be found on Aberdeen’s Website.
For information on the HCM software market, including product comparisons, visit TechMATCH’s HCM Buyer’s Guide.