The talent shortage is real and getting worse. Most companies faced with this reality will rightfully continue to invest in recruitment and retention strategies. But despite implementing these necessary strategies, voluntary turnover is increasing, and employee satisfaction remains stagnant. After billions in investments, not much has changed. According to the Gallup Q12 in 2020 employee engagement survey, only 24% of workers are engaged.
So, why are these investments not yielding the expected outcomes? These traditional investments have diminishing returns because of the uncontrollable and increased impact of external forces. For example, the healthcare industry’s external forces include consumers’ increased demand for healthcare, increased non-traditional competition (like CVS and Walmart), and a finite labor pool that takes years to produce new workers. In 2019, I conducted a study of Registered Nurse (RN) supply in North Carolina and estimated that out of all the licensed RNs in the State, there were 0.8 active applicants for each RN job opening. It takes four years to produce a bachelor’s prepared Registered Nurse who can be added to the labor pool. And in the time, the labor supply gap continues to widen and deepen.
Accept Change and Transform
It is time to widen our examination beyond recruitment and retention solutions. In short, we are experiencing a 21st century problem but have not fully examined whether our basic 20th century organizational and management assumptions, structures, and principles are still relevant. The current organizational structure includes bureaucratic chain-of-command, authority, discipline, task specialization, and other aspects of organizational power and job separation.
In a world where mass production was king and knowledge workers were non-existent, this structure worked fine. But in today’s world of rapid globalization, accelerating innovation, relentless competition, and talent shortages, companies should begin viewing their human resource allocation differently. Having workers assigned to a tightly knit chain of command, in a functional department led by a manager, restricts collaborative allocation of that talent to wherever they are needed in the organization at any time. If the manager is a poor performer, that unit will also have employee satisfaction challenges. In fact, Gallup has found that 70% of the variance in employee engagement is caused by a person’s manager.
Companies must change their talent paradigm and consider internal opportunities as the most powerful management practice in business. Not only can a new talent paradigm engage people and help them grow, but it also helps the company identify skills that reduce the need to constantly search for external talent. In healthcare, the staffing quadruple aim is to have the right number of people with the right skills and experience at the right place, at the right time.
Consider the Mobility of Talent
Josh Bersin, founder of Bersin & Associates, an industry research and advisory firm in enterprise learning and talent management, refers to this model as Agile Talent Mobility. This starts with identifying key influencers and stakeholders and inviting them into a conversation to blue sky thinking about a modern managed corporation, where people move around all the time. This takes place when people work on multiple projects, they join various teams or initiatives, and the company operates more like a professional services firm and less like a hierarchy of jobs and functions.
Typically, an employee is hired into a specific cost center that has an assigned manager. The manager assigns the work based on demand, oversees performance, and is accountable for outcomes.
The manager’s job is to ensure that there is an adequate supply of qualified talent to meet work demand – a constant strive toward equilibrium. However, the ability to match supply of talent to work demand at the department or cost center level is more difficult to manage especially when the work exceeds normal resource allocation and finding more people resources always lags the immediate need for work output. A department manager would have to either recruit for more people (which can take 60 to 100 days), or find temporary help (with an extended orientation and non-productive timeframe). Equilibrium is almost impossible to attain, and disequilibrium is costly because of use of temporary agencies or overtime pay.
Turn Traditional Concepts of Corporations on Their Head
What if we change our orientation and consider a different and more modernized, managed corporation? What if employees were not hired into a specific department cost center? What if they were hired to fill roles that require specific work experience, skills, licenses, certifications, and competencies. That employee can physically or virtually move around the organization and join different teams based on where the work is required. For example, in a hospital, patient movement can be reduced as care is brought to the patient, rather than the patient moved to the appropriate level and location of care. Improving employee flow will naturally improve patient flow, more efficiently utilizing resources that are already in place.
In this modern managed corporation, the manager maintains responsibility and accountability for the cost center or department outcomes, including safety, quality, and service. Also, managers oversee and coach the employees assigned to their department during that shift.
How to Create a Culture of Internal Mobility
Before embarking on such a significant structural change, create a pilot program to determine how best this would work within your organization. Creating a culture of internal mobility is a top-to-bottom effort, Bersin has said. It changes the way careers work; it changes the way you reward and pay people; and it changes the nature of management, leadership, and learning. Some considerations include:
- Develop a strong change management plan to engage leaders and employees to help design the pilot, provide feedback, and actively participate.
- Carefully redefine the role of the manager with a strong emphasis on outcomes and effective communication. In this world, the manager is more of a coach than a controller.
- Build strong and adaptive competency models with a focus on role rather than a list of tasks (a traditional job description).
- Align policies across all departments to support efficiency and consistency in work output.
- Build an organizational staff scheduling capability.
- Review current technology platforms to ensure they can support the structural change.
- Evaluate compensation programs to ensure they support this new paradigm.
In this organization, the concept of an employee transfer evaporates. Instead, a company can move the people resources around the organization to meet just-in-time work needs. Benefits would include:
- Improved staffing and resource allocation.
- Reduced turnover and general improved company performance in areas such as service and quality.
- Reduced talent hoarding and dissuading people from moving to other parts of the organization.
- Improved leadership performance, by raising the bar to the highest common denominator. Poor performing leaders will be hard-pressed to stay under the performance radar because many more employees will experience their leadership quality and style.
- Improved overall individual and company performance with talent development and employee engagement via new experiences, learning, and growth.
- Quicker identification of employee poor performance that can otherwise stay under the radar for a long period of time.
Step into the Future
"It’s time for companies to provide employees with agile, personalized mobility that helps them move their careers into the right direction while meeting organizational needs with talent from within their own walls," Bersin has said.
With the current talent challenges, Human Resources leaders are poised to solve business problems. Although the idea presented in this article is a heavy lift, there could be a significant transformational upside to presenting this or other vanguard ideas to business leaders. Start by identifying key influencers and stakeholders. Invite them to the conversation and challenge the status quo and assumptions and pilot different ideas to yield better outcomes.
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