What do you think of when you hear the term talent management? If you immediately start exploring the ways in which companies handle their employees, you’re a decade or so behind the times.
Today, talent management means something a lot broader than just employees, as the workforce changes, and different kinds of workers enter the talent race.
This is part of an extensive series of guides about FinOps.
Learn more in our detailed guide to finding talent.
Related content: Read our guide to talent shortage.
Talent Management Strategy
No doubt about it. A talent management strategy is no longer focused on employees only. Today, an increasing number of workers are looking for less traditional roles, whether that’s becoming Gig workers, consultants, or independent contractors.
Without a holistic strategy that looks at the workforce as a whole, companies will quickly become unstuck. Any single project or team could include full time employees, part-time employees, independent contractors, long-term consultants, agency workers, and more.
There are so many complexities involved. Think about hiring different kinds of staff, onboarding them to common systems and processes, managing their workload, budgeting for and paying their compensation, and keeping them involved and retained by the business. It’s a lot!
A talent management strategy will be a codified cheat sheet for how hiring managers as well as other departments can go about managing all the different kinds of talent under the companies’ roof.
Talent Management Process
It can be helpful for companies to set up a defined process for talent management, so that they can identify gaps in the way they work, and smooth out any road bumps.
You can do this at a regular cadence, for example each year at budgeting season, or you can create a talent management process for the start of a new project when you’re evaluating what you will need. Common steps include:
#1 Making a plan for success
What talent do you need? This is the start of your talent management process, recognizing what your goals are. Traditionally, most businesses would stick to how many full-time employees were necessary, but today, the options are much broader.
You might decide to have a core team of in-house employees, and augment that with independent contractors, consultants, or even agency workers where necessary.
Top tip: Different roles require different workers. Full-time or part-time employees will be a good choice for when you aren’t exactly sure what the job will involve, while independent contractors can bring more niche talent to the table for filling specific tasks or dropping strategic knowledge.
#2 Attracting and selecting candidates
Now that you know what you need, you have to find that talent! With a new approach to talent management, today’s procurement teams have many more options at their disposal.
As well as traditional recruitment firms, staffing agencies and MSPs, companies can find a wide range of talent through freelancer marketplaces, or their own networks or social media. However, it can take time!
Creating a process for how you find the right talent can streamline procurement and hiring. One option is creating a talent pool, a ready resource of people who you already know could be right for the job at hand. This could include people who have applied for previous positions with your company and have been rejected, those who left the company, or freelancers that you’ve worked with in the past.
As you already have information about these candidates, you already know that they are a good fit, and interested in working with the company.
#3 Onboarding people to your team
The next stage of the talent management process is getting new workers started. Today, hiring is a cross-functional effort, with teams as disparate as Legal, Finance, IT, and HR getting in on the action.
Streamlining this process is essential, as until your workers can start on the task at hand, you’re just losing time and money.
Ask yourself, “what can I automate or create repeatable processes for?” For example, each freelancer will need to fill in W8 or W9 tax forms, so this is something you could automate when you onboard a new independent contractor. If Legal has specific expectations for background checks or compliance, look for ways to add technology that speeds up time to value.
#4 Developing and retaining talent
Finally, make sure that part of your talent management process is how you’re going to keep the talent around. After all, you’ve just done a whole lot of work to get them through the door!
It’s no surprise that once again, different approaches will work for different types of workers. For example, full-time employees may feel more valued if you offer them professional development opportunities, while independent contractors will appreciate smooth processes for payment and communication.
Speak to non-traditional workers about their availability to be part of your talent cloud, a ready pool of freelancers who you can call on as and when you need specialist skills. It’s helpful to have details for at least 2 independent contractors for each of your needed skill sets, as you don’t have control over freelancer availability.
Talent Management Systems (TMS)
Talent Management Systems or Software (TMS) describes the technology that companies use to handle their talent. As the definition has broadened, it’s become increasingly complex to manage new kinds of workers alongside traditional ones, and so the need for tools to get the job done has risen exponentially.
If you want some data to back up this growth, you don’t need to look too far. According to the latest estimates, the global talent management software (TMS) market reached a value of US$ 10.4 Billion in 2021 and is expected to reach US$ 25.8 Billion by 2027, exhibiting a CAGR of 16.35% during 2021-2027.
Best-in-class TMS will support tasks such as:
Strategic hiring: Helping you to find the right talent at the right time, avoiding trial and error or time consuming marketplace searches.
Independent contractor management: Setting milestones, and offering easy communication and support so that contractors feel like a part of the team.
Onboarding new workers: Automating documentation, tax, compliance and background checks, and providing access to the right systems to hit the ground running.
Budgeting and payments: Tracking budgets across different departments and managers, and ensuring every worker is paid accurately and on time.
Compliance: Avoiding misclassification risk for independent contractors, according to specific regional laws or expectations.
If you’re still thinking about talent management as those employees who clock in and out between 9-5, and are whiling away the years until their pension matures, you’re missing a trick.
Today’s companies are seeing so much more value by broadening their understanding of talent management, and onboarding the right processes and tools to take advantage of the blossoming freelance revolution.
See Additional Guides on Key FinOps Topics
Together with our content partners, we have authored in-depth guides on several other topics that can also be useful as you explore the world of FinOps.
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