By Jim Jonassen, founder of JJA Venture Search
- Just as digital innovation is considered a major value pillar at companies right now, talent will be the major pillar of the future.
- Businesses should take cues from the sports and entertainment industries, where recruiting and maintaining talent is of utmost importance.
- Get onboard by prioritizing talent at your company, honing your "employer brand" and demanding visibility into talent acquisition while making it a core competency.
When will companies finally get it? Winning is first and foremost about the talent. Most problems in startups, large public corporations and SMBs alike are talent-related.
Companies have distinct personalities and cultures. But somehow, the people who populate and run those citadels of commerce are largely invisible, save for a few charismatic leaders hogging the headlines. Somewhere along the way, people became a commodity – a “resource” akin to equipment or funding.
Companies once called them personnel (almost human), then shifted to resources (less human). In the latest twist, talent has been “elevated” to the same cupboard as cash: human capital. What’s next, human cattle?
To win the talent war, think like a sports team owner.
This is not the case in professional (and even amateur) sports. There, skilled athletes are highly prized, recruited and compensated.
Think leaderboards, the draft, minor leagues, the combine, agents, managers, scouts and even fantasy leagues. Professional teams are obsessed with scouting, acquiring and developing talent. Pay scales have skyrocketed.
As top talent (both coaches and players) moves from place to place – and along with it, the ability to win championships – teams are continuously reconfigured. A talent emphasis always prevails.
The NBA has some of the highest paid athletes in the world. Stephen Curry (left) is the league's highest-paid player.
Entertainment and media get it, too. Think guilds, talent agents, casting directors, managers, studios and packaging. The writers, directors and stars represent most of the industry’s value. They are the assets which audiences pay for.
Talent is the next big pillar of corporate value.
In the digital age, giants across many industries -- ranging from Apple to Zappos -- have created incredible corporate value with constant innovation and agility. Companies have revolutionized the process of customer acquisition, for example, through myriad digital technologies.
Talent, however, is the next great pillar of business value.
Many of America’s top VCs – Greylock Partners, a16z, Khosla Ventures and others – have created their own “talent manifestos.” They now demand that their portfolio companies spend as much as half of their time recruiting and remain constantly on the talent acquisition offensive.
Just as sales has always been everyone’s job, so too is recruiting.
Venture capital firms are increasingly focused on talent acquisition.
A few of the world’s most valuable brands get it. They work with the top headhunters and have built their own retained search firms inside the company. Biggies such as General Electric, Coca-Cola, and Pfizer increasingly use their own executives to recruit talent. A former headhunting colleague of mine built Red Bull’s internal executive search firm with a team of 50+ and is now doing the same at Disney.
Google has freelance recruiters who track PhD’s in relevant sciences and engineering disciplines from graduation through their entire careers, per info from contract recruiters in my network.
Meanwhile, Kaiser Permanente is said to track med school graduates in North America from the moment they leave school and monitor each career move, attempting to recruit them at every opportunity. They’re preparing to grow their own talent base by opening a Kaiser medical school in Pasadena, California next year.
This is how the “one percenters” win the war for talent. But for every company that gets it, hundreds of others don’t.
Business needs new talent recruitment game plans.
Pro sports has franchise players and highly coveted first-round draft choices. Music and film have rock and movie stars who deliver box office profits. These “above the line” skill players are discovered, signed, treated and paid very differently than the rank and file.
To win the war for talent, companies must think about their own critical positions differently from the base of “common” hires. Globally dispersed, low-cost “common talent” is highly accessible. Labor has no borders.
However, demand for specialized skills is off the charts. Be warned: This problem is not cyclical and is getting worse.
Coding is considered one of the most necessary specialized skills for the future.
What’s more, critical hires are not limited to C-suite positions. Talent stars exist across a broad swath of categories including software architects, blockchain or Python coders, skilled account managers or customer service supervisors, creative UX/UI designers, innovative growth hackers, community managers and others.
But finding, engaging and recruiting them is increasingly challenging as demand for their skills grows and compensation moves higher.
Hiring “franchise players” is both the number-one imperative and number-one challenge for businesses today. The long “jobless recovery” of recent years -- which once created a buyer’s market for critical hires -- is now toast.
Recruiting top talent today requires new tactics and a new methodology.
So, draft your company’s plays.
Here are four things you can do to position your organization to win the talent war going forward:
1. Elevate talent acquisition to a higher level of strategic importance.
Put it closer to, say, product development or customer acquisition and retention.
2. Develop and constantly evolve your “employer brand.”
You probably spend countless hours on pitch decks, messaging, website and a brand bible. An employer brand is equally important. It answers the question of why anyone would want to work at your company.
Think of your employer brand as a value proposition to your employees.
3. Demand visibility into the talent acquisition funnel.
Find out what’s used by every department for every critical hire.
4. Consider making talent acquisition a core competency.
Perhaps you'll do this by creating an in-house recruiting firm that uses internal resources alongside the expertise, networks and professional services of search firms and recruiting agencies.
And don’t waste another second.
As businesses face a dramatically worsening shortage of the skills needed in a digital world, finding, developing and keeping talent is the next frontier.
Companies can ill afford to be solely fixated on performance ratios such as revenue, profit, market share and margins.
Talent must be king.
This priority shift won’t be easy. Talent was long considered an intangible. But talent is not an intangible. And smart business leaders know their future success is tied directly to the new pillar of value: Talent.
Like what you see? Sign up for The Grow Wire Email Newsletter.