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CEOs Taking Greater Role in Talent Management

August 9, 2006
Related Topics: Strategic Planning, Workforce Planning, Featured Article, Recruitment
Georges Le Mener, CEO of Accor North America, a hospitality industry powerhouse with $1.4 billion in annual revenue, takes talent management very seriously.

    Le Mener’s agenda is filled with regularly scheduled trips to visit employees in satellite offices and dates for the monthly executive training courses that he teaches at the Accor North America Academy in Dallas. He uses his meetings with employees as an opportunity to not only champion Accor's core corporate values but to identify promising talent, while also working closely with HR on coaching and mentoring management issues. Le Mener reckons that he spends about a third of his time on workforce strategy.

    He is part of an emerging breed of CEOs that recognizes workforce management can play a potent role in expanding a company’s revenue base. About 30 percent of executives who participated in a survey conducted recently by the Economist Intelligence Unit and Development Dimensions International say they devote 30 percent to 50 percent of their time to talent management.

    "The sheer amount of time that they are spending on workforce is surprising," says Lucy McGee, director at Development Dimensions International UK. "Particularly when you consider how busy these individuals are."

    There were 20 corporate leaders--18 CEOs, including Le Mener, and two COOs--from a wide spectrum of international companies who were interviewed for the study. Most of the survey’s participants work within organizations that generate $1 billion or more in annual revenue and enjoy wide brand recognition. The participants include CEOs from companies like Pitney Bowes, Delphi Packard and Allstate.

    The executives interviewed in the study avidly practice strategic workforce management. Sophisticated tools for critical HR activities, such as succession planning, 360-degree feedback and talent development, are widespread throughout their companies. In addition, all of the CEOs in the survey say they take the time out of their hectic schedules to write formal evaluations for the people who report directly to them, generally six or so senior executives.

    Looking at the general framework, it may appear these companies have reached HR utopia. Not necessarily, the survey found. Many of the survey participants are struggling to draw a direct line between sound talent management practices and corporate goals.

    "They say that strong talent management leads to better corporate performance, but many are still looking for ways to measure this relationship," McGee says.

    There are other pitfalls that CEOs should be cognizant of, such as focusing too narrowly on a single aspect of workforce management, like coaching, and leaving others by the wayside.

    "Talent management is not a piecemeal process," McGee says. "It should be undertaken as a comprehensive strategy."

    The survey reveals that only a few firms use formal assessments to determine leaders' readiness for future jobs.

    Overall, having the CEOs engaged in talent management is a move in the right direction, McGee says. The strong level of commitment is pretty much universal: CEOs from Asia to North America all indicated that workforce management was one of their most important responsibilities.

    "The philosophy we hold is that if we satisfied our customers, they are going to come back again and again, and that we can (then) deliver profit to our shareholders," Le Mener said during his interview for the study. "That brings us back to the idea that we are totally dependent on the quality of the people that we have."

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