Originally Published in Fair Value
Last Autumn, I gave an interview and later wrote about the importance of developing talent in organizations. My claim was that by creating opportunities for people to grow, we reap the reward of their unique and valuable contributions to our overall goal. That much, I said, is mainstream progressive thinking-so, much so that my substantive point was that sticking to the path isn’t always as easy as it seems. Certainly, I’d not expected the core view to be challenged.
Investing in Internal Talent Isn’t Enough
However, some weeks ago, a former colleague put it to me that investing in talent wasn’t enough; what’s more, she pointed out there were numerous examples where I’d personally hired senior leaders in a way that had potentially leapfrogged others in the organization. Surely, she suggested, there were times when building from within was too slow or too haphazard for the needs of a particular situation. And, of course, like all fair challenges, she was right—at least in part.
A commitment to growing and giving space to talent remains fundamental to the health of most companies. It’s especially appropriate in working towards long-term goals when the workforce is relatively stable and, importantly, when there’s sufficient scale and opportunity to allow for regular career progression. Absent some or all of these conditions and the strategy is clearly less productive. But even in the most vibrant and forward-thinking of organizations, there will still be occasions when an injection from outside can be both necessary and beneficial.
Bring In Outside Talent Is Needed
The impetus from fresh perspectives, particularly during periods of change, should not be underestimated. Nor too should the objectivity that external recruits can bring, helping to counterbalance the established cultures and processes which constrain all of our abilities to see things differently. And sometimes, particularly in markets that are changing rapidly, there’s a critical need for skills and insights that simply can’t be developed in-house. Recruitment for these purposes comes at a cost, but if done wisely I believe there’s no inherent conflict with a wider commitment to internal talent and succession plan.
Similarly, there are times when organizations require a short-term injection of skills that would be uneconomic or suboptimal to develop internally. Technology projects, for example, often need experts in coding and system architecture, just as transformation programs will benefit from change management specialists. Even those companies with a depth of internal skills to draw on are likely to have specialist partners to help with areas such as branding, legal matters, or senior recruitment.
Blending Internal and External Talent is Key
This blended approach to internal and external talent is the reality, if not the stated strategy, of most sizable companies. It’s sometimes referred to as the “build-buy-borrow” approach, and the skill is to get the balance right over time while meeting the needs of each situation. Too much emphasis on external recruitment, for example, will lead to demotivation and insufficient embedded knowledge; similarly, outsourcing works best when delivered through trusted partners who understand not only the immediate goals but also the culture and values of the organization, and often its history too.
Temporary, or Interim, Appointments Aren’t Usually Helpful
As an aside, one of the differences I’ve observed over recent years is the extent to which temporary appointments are significantly more common in the UK than in the US. Indeed, in the UK, it’s now not unusual to come across interim specialists whose career is founded on a mix of troubleshooting, project management, and “minding the shop” before the arrival of a permanent appointment. At their best, these specialists can be skilled at driving through the quick and sometimes difficult decisions that a crisis or void demands-but soon as we turn to look at the longer term, the attractions of interim appointments strike me as limited. As a former colleague once put it to me: interims are a very sharp tool to be used for precision and with appropriate care.
Returning to the original theme, while I’ve counter-argued that a blended approach to recruitment is compatible with a commitment to talent, there’s much truth in the suggestion that investment alone is not enough. Even a casual interest in the history of sports will show that the building of great teams is never just about money. Similarly, pouring cash into training and development programs without the appropriate culture and opportunity to support the aspirations this fosters will lead only to roadblocks and frustration; at worst, you’ll end up training colleagues on behalf of your competitors, which is where they’re likely to head.
Two weeks ago, the UK’s Sunday Times published the latest results of its annual “Best Companies to Work For” survey. The poll is a long-established benchmark of employee engagement as measured by colleague opinions to score highly; it’s not enough to have good policies on paper; they must truly resonate with employees across a range of workplace measures. As the “Best Companies” website neatly summarizes, at these leading companies, “… employees encounter inspirational leaders, charitable and environmental initiatives built into work life, a focus on staff wellbeing, fair financial rewards, skills- boosting training and career progression, excellent managers, and teammates who inspire both admiration and fun to lay boys That’s quite a list-and in scanning the results, it struck me that the majority of the businesses which ranked highly were necessarily not simply the feel they have sustained by necessarily the household names we might expect. This suggests it’s not simply the aura of a brand or even scale which makes colleagues feel they have the opportunity; rather, their satisfaction is primarily sustained by an ambition to succeed together, underpinned by values that respect them as individuals.
In-House Skills Isn’t Everything
So, what of the concerns raised by my former colleague? It’s certainly true that there have been occasions when I’ve hired external talent, and in most (though not all) cases, I’d do so again. And I agree that a sole focus on in-house skills, no matter how well-resourced, is unlikely to be sufficient. Indeed, given the uncertainties of commerce and the pace at which change occurs, I doubt any of the leading companies in the Sunday Times survey follow a single-track strategy. But for all that, a blended approach is a more accurate description of what most businesses will follow; without an underlying commitment to progress through people, their options are likely to be more limited and less sustainable.
In many ways, I was pleased to receive the challenge. I enjoyed the discussion, and in truth, our positions were inches apart. Importantly, it was offered in a constructive spirit as an opportunity to explore and learn together. And I’d argue that’s exactly the approach we most need to nurture: a desire to find the best way forward, founded on a commitment to each and all of our abilities, offering scope for personal growth while welcoming newcomers and the skills and perspectives they bring.