Talent is the key to success in today’s global economy, but as organizations increase their investment in human capital many of them question whether it is paying off. According to Mercer’s new Talent Barometer Survey, 60% of organizations worldwide report increasing their investment in talent in recent years. However, a much smaller percentage of respondents, 24%, say their plans are highly effective in meeting immediate and long-term human capital needs.
Additionally, 77% of those surveyed by Mercer have a strategic workforce plan in place. But when asked whether it is part of their longer-term strategy, only 12% said they had plans that extended for five years or more.
“Effective workforce planning is an essential part of positioning talent as a strategic asset and maintaining a competitive business advantage,” said Julio A. Portalatin, President and CEO of Mercer. “With the information and data analytics available today, employers can measure and manage their talent like never before. The question is whether the increased attention and efforts deliver the intended results. Outperformance requires a blend of innovative solutions and a fact-based approach to managing talent.“
Mr. Portalatin and other Mercer leaders presented the Talent Barometer Survey findings and discussed talent challenges at the recent World Economic Forum’s 2013 Annual Meeting in Davos-Klosters, Switzerland.
Mercer’s Talent Barometer Survey, which assesses the effectiveness of workforce practices in driving the short- and long-term success of organizations’ talent plans by region and industry, includes responses from HR and talent management executives at more than 1,260 organizations around the globe. The organizations surveyed vary in size from fewer than 1,000 employees to more than 10,000 employees (including government and not-for-profit organizations) and represent a wide variety of industries. The survey identifies a number of innovative practices that are characteristics associated with effective workforce plans.
Accelerating talent effectiveness
Mercer’s Talent Barometer research also explores key accelerators of talent effectiveness – education, health and wellness, and career experience – and their impact on successful workforce practices.
Significantly, more than half (57%) of the organizations surveyed are not confident that educational institutions will generate the talent needed by their businesses today. The sentiment among respondents does not improve even when they are looking out as far as five years from today.
“This lack of qualified talent is a real concern for employers and one that requires a multi-stakeholder approach to solving. We have found companies that are most optimistic about the future are actively involved in shaping it,” said Pat Milligan, Region President at Mercer and member of The World Economic Forum’s Global Agenda Council on Education and Skills. As a result of this educational gap, the survey shows organizations are employing internships, apprenticeships, and teaching high-demand skills in secondary and tertiary institutions.
As for health and wellness, Mercer’s survey finds that less than half of organizations worldwide actively apply the basic elements of a health management program, such as ensuring a healthy workplace and establishing health-related policies and procedures (as reported by 48% and 44% of organizations, respectively). Less than one-third (31%) actively use a formal, written multi-year strategic plan for health and wellness. “The research suggests a strong link between employers’ focus on health and wellness and employee engagement and productivity. This means that employers are missing out on one of the greatest tools available to enhance their strategic workforce plans,” said Dave Rahill, President, Mercer Health & Benefits.
The Talent Barometer research also confirms that encouraging diverse career experiences and opportunities for growth which allow talent to excel is an essential part of workforce planning. According to Mercer’s survey, organizations globally take the issue of career experience seriously, with the majority (80%) conducting regular (annual or semiannual) talent reviews. However, far fewer actively employ other actions that enhance talent availability and quality, such as assessing supply and demand of critical talent, putting a strategic succession plan in place and developing programs for high-potential employees.
For more information about Mercer’s Talent Barometer Survey, please visit our website at www.mercer.com/talentbarometer.
Mercer is a global consulting leader in talent, health, retirement and investments. Mercer helps clients around the world advance the health, wealth and performance of their most vital asset – their people. Mercer’s 19,000 employees are based in more than 40 countries. Mercer is a wholly owned subsidiary of Marsh & McLennan Companies (NYSE: MMC), a global team of professional services companies offering clients advice and solutions in the areas of risk, strategy and human capital. With 53,000 employees worldwide and annual revenue exceeding $11 billion, Marsh & McLennan Companies is also the parent company of Marsh, a global leader in insurance broking and risk management; Guy Carpenter, a global leader in providing risk and reinsurance intermediary services; and Oliver Wyman, a global leader in management consulting. For more information, visit www.mercer.com. Follow Mercer on Twitter @MercerInsights.