Talent Management Is Broken According to New DDI Study

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Development Dimensions International (DDI) study finds that senior leaders set it as a high priority, but weren’t dedicating enough effort.

This is dramatic, because this tells us that leaders are grading themselves poorly on the two most fundamental elements to growing talent – identifying and developing leaders

More than half of senior leaders anticipate their companies’ performance will soon suffer because they don’t have the right talent in place, according to a recent report from Development Dimensions International (DDI) written in co-operation with the Economist Intelligence Unit (EIU).

The report "Growing Global Executive Talent: High Priority, Limited Progress" found that while talent management was a significant priority for organizations, their efforts weren’t meeting the needs of the business. The disconnect is that while senior leaders recognize its importance for the success and future of their companies and divisions, they’re not hands-on about what needs to be done.

"Leaders see the opportunity, they talk about it, they invest in it, but this is a job that requires their direct involvement, and most just aren’t skilled or experienced at doing it themselves," Matt Paese, vice president of Executive Solutions for DDI, said. "It’s astounding given the fact that they recognize the business impact of having the right people—yet they’re outsourcing accountability for it."

The findings are based on a survey conducted by the EIU, on behalf of DDI, in September and October of 2007 with 412 senior leaders in Europe, North America, Asia and Australia. To complement the quantitative findings, eight C-suite executives, or its equivalent, were interviewed on their perceptions on talent management. The major findings of the report include:

Talent management from the top down:
The study found that 85 percent of CEOs said that talent management is as important as or more important than other business priorities. But only two in 10 leaders say they often spend time managing talent and one in 10 often review it with their boards.

"Many leaders don’t recognize that their involvement in talent management initiatives could turn the tide for the organization," Paese said. "It’s a missed opportunity for those leadership teams."

CEOs and other senior leaders have an opportunity to set the tone for the entire organization through their own involvement. Yum! Brands Chairman and CEO David Novak sees talent management as his responsibility. He said he continuously focuses on talent management "because every opportunity is a chance to coach, develop, share what you’ve learned with somebody else, get a perspective on somebody, assess their potential, assess their development needs," Novak said.

"Any time I go into a meeting, I’m always looking at the people and thinking about what I can do to develop them, improve their skills, give them the coaching they need," Novak continued.

Right place, wrong people?
The executives surveyed said their greatest obstacle to executing business strategies well was not having the right person in the right job. For some organizations, this means not making the right promotion decisions, and for others, it’s not having enough talent ready to move into critical roles. "This suggests that while organizations fully recognize the criticality of talent management, they are often not prepared to replace leaders who are not executing effectively," Paese said.

Development disillusionment:
Half of the leaders surveyed said their organizations are doing sub-par work in developing their leaders and more than half said they were fair or poor at identifying talent. Further, 60 percent of organizations are not satisfied that talent is growing fast enough to meet their most critical business needs.

"This is dramatic, because this tells us that leaders are grading themselves poorly on the two most fundamental elements to growing talent – identifying and developing leaders," Paese said.

About DDI:
Founded in 1970, Development Dimensions International, a global human resources consulting firm, helps organizations close the gap between today’s talent capability and future talent needs. DDI’s expertise includes designing and implementing selection systems, and identifying and developing front-line to executive leadership talent. With more than 1,000 associates in 75 offices in 26 countries, the firm advises half of the Fortune 500. For more information about DDI visit http://www.ddiworld.com/aboutddi.


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Jennifer Pesci-kelly
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