Posted: 25 Sep. 2020 11 min. read

It’s time to retire talent management

Organizations are rethinking their approach to the workforce ecosystem

Posted by David Mallon, Denise Moulton on September 25, 2020.

It’s time to retire talent management

This refrain is well known: the work, workplace, and workforce are changing, and have been for some time. Disruption, innovation, resilience—these words would feel overused if they weren’t so appropriate to the current reality. Given these challenges and opportunities, it’s not surprising that many organizations are questioning traditional approaches such as talent management as they attempt to synchronize the work, workplace, and workforce.1

The shrinking relevance of talent management

Why is it time to retire the term talent management? To answer that question, a short history lesson is in order. The term originates with the first use of the phrase “the war for talent” in the late 1990s.2 The early 2000s saw organizations begin to explore perspectives and formalize approaches. In 2006, we called attention to integrated talent management, which was then an emerging trend: “[There is an] increasingly common focus on a suite of HR and [learning and development] applications we call ‘talent management.’ … talent management uses the processes of [HR development] to address business problems such as critical talent shortages, the need to build a leadership pipeline, the need to fill critical talent gaps, and the need to implement a pay-for-performance culture.”3

In the 15 years since, organizations have endeavored—some successfully and some less so—to integrate workforce-related processes and technologies in support of “pipelines” and “critical roles.” In the best of circumstances, business plans drive talent plans, which then drive an interconnected set of talent-related activities. The ultimate goal was to create a healthy supply chain for talent.

The workforce is an asset to be cultivated—not a resource to be supplied at cost.

The are several challenges with this supply-chain view of talent management. Let’s start with the word talent. Most organizations now recognize their workforces are comprised of much more than just the “top X” leaders and certain pivotal roles. Heads of talent—and other HR.

leaders—know they need to address the whole of the workforce, including those workers in the wider ecosystem and not on the balance sheet. Actually doing so, though, remains elusive for all but a few of these leaders. Continuing to use the word talent only makes organizations’ attempts to widen their gaze that much more difficult.

The word management also raises issues. The chart shown below illustrates the waterfall approach to planning that is integrated talent management done well.

Talent management, circa 20074

The business alignment implicit in this process flow is the source of both its attraction and its greatest impact. Organizations, then and now, often struggle to connect on-the-ground investments and activities with larger missions and objectives. In that regard, integrated talent management has served a valuable purpose as both inspiration for change and as a practical driver toward having one set of people data in service of one person's story (e.g., the talent lifecycle).

However, this waterfall approach is starting to fail on two fronts. First, it can depend on some faulty assumptions. Believing organizations can consistently manage their talent from the top down in support of cyclical plans likely overplays those organizations’ prescience as planners and their immunity to constant change and disruption. Cyclical approaches to strategic planning are increasingly fraught with peril—the current pandemic being a stark illustration. In response, some are choosing to plan in shorter cycles (e.g., moving from five-year plans to three-year plans). Some are choosing to abandon such planning altogether. Either way, there is substantial evidence that calls into question organizations’ ability to plan with requisite accuracy.5

Yes, many organizations have effectively employed a talent management approach while meeting workforce needs, but they and others should be careful about attributing credit. Given the pace and intensity of change, it’s at least equally likely this achievement was due to strong capabilities to sense and adapt—to handle exceptions6—then it was delivering on critical path expectations as originally defined. In other words, it’s not that organizations were necessarily successful at talent planning or development (i.e., executing to plan); rather, it’s that some organizations are better than others at learningand adapting (i.e., deviating from the plan).8

The second point of failure for the idea that organizations can manage a talent supply chain is potential. As some of our fellow Deloitte researchers put it, “the future of work is potential—for expanding value and meaning.”9 Work is changing. If organizations are intentional in how they architect work in concert with the workforce and workplace, and if those organizations are strategic in investing in the inherent human capabilities of their workforce to adapt to that change over time, those organizations can then create capacity for yet-unimagined value.

This potential value dwarfs anything that might be returned by simply managing the workforce to close gaps and meet plans. The workforce is, therefore, an asset to be cultivated—not a resource to be supplied at cost. Talent management, by encouraging this supply chain view, stands squarely in organizations’ way of making this larger, asset-based case.

From talent management to workforce architecture

If not talent management, then what? Organizations will continue to have the workforce needs to meet—now and in the future. They will continue to make related investments and connect related programs and processes to meet those needs. This question is not one of substitution but of framing. What questions are asked? Where is attention focused? Rather than use the word talent, organizations should use the workforce. The workforce is more accurate, more inclusive, and more likely to be viable regardless of future change.

Instead of management, organizations should use architecture. Architecture is the answer to a different question than management. Rather than, “How might the organization integrate talent processes to support the top-down management of talent pipelines?” the question becomes, “How might organizations architect these processes and flows together to build the bottom-up platform on which they will then access and curate their workforce and keep it in sync with the changing work and workplace?” This pivot is similar to the reframing that happens with the switch from traditional waterfall design to human-centered design, or design thinking. 

Comparing talent management and workforce architecture

The purpose of a workforce architecture isn’t just to ensure supply or close gaps, moving logically from plan to objective. The purpose is to create the sustainable system whereby the organization has a productive, thriving, resilient workforce ready to adapt and contribute value to any outcome given any scenario.

The upside of the current moment—one in which the future of work has become present—is that the door is now open for organizations to replace outdated approaches like talent management with new ones. We were there when talent management was new—on the front lines helping organizations connect talent processes in service of business needs. We’ve been there at each step along the way, helping organizations understand which steps are likely to create the greatest impact. Today, we’re ready to help organizations craft a workforce architecture that combines the best of the current approaches with new methods and mindsets to build a foundation for the workforce—now and in the future. To get started, we offer findings from our High-Impact Workforce research.10 Three of these findings illustrate that high-performing organizations are apt to:

  • Empower workers to adapt to and grow for an ever-changing future as the foundation of their workforce strategy
  • Move beyond managing talent to systemically and simultaneously synchronizing the work, workforce, and workplace
  • Cocreate the work, workforce, and workplace with people and for people

Percentage of organizations that use the following work/workforce / workplace practices to a large or very large extent

It's your move

Thinking of talent as an exclusive subset of workers should give way to an inclusive approach to the workforce ecosystem, empowered to drive meaningful change and valuable contribution. Rather than being driven by technology, organizations should invest appropriately in their biggest asset, their people—deploying a human-centered approach. In doing so, they cocreate with people for people. To learn more about our High-Impact Workforce research, please attend our September 29 webinar “From Pipeline to Platform: Why Workforce Architecture Will Replace Talent Management.” You can click here to register for this event.

To learn more about our High-Impact Workforce research, please attend our September 29 webinar “From Pipeline to Platform: Why Workforce Architecture Will Replace Talent Management.” You can click here to register for this event.

To read all of the detailed findings from this research, Deloitte’s Human Capital Research & Sensing members can access Seven Top Findings on Moving from Talent Management to Workforce Architecture. They can also access additional articles, tools, and resources on the Workforce Transformation Framework & Maturity topic page. Our continuing articles in this series will take a deeper look into the many aspects of this subject.

If your organization is innovating in its approach to the work, workforce, and workplace, we’d love to hear from you! Contact David Mallon (dmallon@deloitte.com) and Denise Moulton (dmoulton@deloitte.com) to share your story, or contact Burt Rea (brea@deloitte.com) to become a part of the Research & Sensing membership program.

Endnotes

Seven Top Findings on Moving from Talent Management to Workforce Architecture, Deloitte Consulting LLP / David Mallon, Nehal Nangia, Mike Kemp, and Kathi Enderes, PhD, 2020.

2 “The War for Talent,” The McKinsey Quarterly (Volume 1, Issue 3) / Elizabeth Chambers, Mark Foulon, Helen Handfield-Jones, Steven Hankin, and Edward Michaels III, Summer 1998.

The Convergence of Learning and Performance Management: Has Talent Management Arrived?, Deloitte Consulting LLP / Josh Bersin, 2006. 

4 High-Impact Talent Management: Trends, Best Practices, and Industry Solutions, Deloitte Consulting LLP / Josh Bersin, 2007. 

5 Zoom Out / Zoom In: An Alternate Approach to Strategy in a World that Defies Prediction, Deloitte Insights / John Hagel and John Seely Brown, 2018.

6 Beyond Process: How to Get Better, Faster as “Exceptions” Become the Rule, Deloitte Insights / John Hagel, John Seely Brown, Maggie Wooll, and Andrew de Maar, 2017.

7 Zoom Out / Zoom In: An Alternate Approach to Strategy in a World that Defies Prediction, Deloitte Insights / John Hagel and John Seely Brown, 2018.

8 Six Top Findings for Designing Tomorrow’s Companies Today, Deloitte Consulting LLP / David Mallon and Timothy Davis, 2019.

The Beaten Path Won’t Get You There: A Pragmatic Pathway for Redefining Work, Deloitte Insights / John Hagel, John Seely Brown, and Maggie Wooll, 2019. 

10 Seven Top Findings on Moving from Talent Management to Workforce Architecture, Deloitte Consulting LLP / David Mallon, Nehal Nangia, Mike Kemp, and Kathi Enderes, PhD, 2020.

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David Mallon

David Mallon

Vice President and Chief Analyst

David Mallon, a vice president with Deloitte Consulting LLP, is Chief Analyst for Bersin, Deloitte’s human capital research and sensing team. He is the team’s lead researcher, bringing data-driven insights to life for members, clients, and the HR vendor market. Part of Bersin since 2008 and Deloitte since 2013, Mallon is a sought-after thought leader and speaker on organization design, organizational culture, HR, talent, learning, and performance.

Denise Moulton

Denise Moulton

VP | Human Resources and Talent Research

Denise leads human resources and talent research for Deloitte. Specializing in talent acquisition, talent management, HR administration, and field operations, Denise is also skilled at driving reinvention across onboarding programs, employment branding initiatives, and recruitment management. Her 19 years of experience include talent program development, cross-functional campus recruitment, and recruitment ambassador programs. Denise holds a bachelor of arts in English, and has completed coursework toward a master’s in labor relations and human resources from the University of Rhode Island.