Recruiting and retaining qualified personnel in this post-recession environment is a challenge in all segments of the economy. This is especially true of finance talent, where issues including retiring baby boomers, regulatory pressures and complex operations are impacting the availability of key finance talent. But a recent presentation by Ken Kunkleman of Deloitte Consulting at the VMA 2012 Finance Leaders Seminar offered excellent strategies to fill this growing need.
Despite continued levels of high unemployment, there is an increasing scarcity of the highly skilled talent that can thrive in the post-recession economy. Critical talent is on the move, seeking opportunities that were limited and risky during recession, and there is a sizeable risk that your good employees can be poached as companies compete to attract the same highly skilled talent pool.
Factors putting a strain on the talent pool include retirement of the Baby Boomers. Approximately 78 million began retiring in 2008, and as the economy improves, it is expected that this skilled workforce will retire at increasing rates. There are also increasing regulatory and control pressures and an increased workload due to Sarbanes-Oxley and other regulatory compliance (e.g., IFRS) which must be matched with additional competent resources with no additional funding. And it’s not just the number of employees which is at issue. A number of studies suggest that up to half the workforce is disengaged.
While it seems logical that increasing compensation is a way to hold onto talent, that is not necessarily the answer. Compensation packages are easily matched and monetary rewards do not necessarily foster long-term commitment. In this post-recession environment, employees, especially Millennials and Gen X’ers, place more importance on the opportunity to grow and advance.
Among the recommendations in his presentation, Kunkleman suggested the following:
Planning: The company must plan specifically for critical workforce segments, including finance, in order to realize a higher return on talent programs. Remember that the average cost to replace an employee is 1.5 times average salary, so retaining and developing existing employees can save a company anywhere from three to ten times the cost of replacing employees.
Financing: It’s also important that a company be deliberate in defining finance talent and identifying the skills required to meet future needs. A Corporate Executive Board survey estimates that Corporate Finance professionals will need to develop new skills that represent 58% of their overall capability toolkit.
Provide Opportunities for Broadened Experiences: Finance leaders strongly urge those seeking to thrive in finance today to pursue rotational and international assignments and otherwise broaden their experience. Providing opportunities such as these can differentiate your organization from others being considered by recruits.
Develop, deploy, and connect finance talent: This is done by enabling critical workforce segments to acquire cutting-edge skills. By strategically developing critical talent, the company can enable intensified growth, and by enabling relationships, employees can connect to and help the company and each other.
Steps to a Comprehensive Talent Strategy
A series of questions were presented to help develop a broad finance talent strategy that allows companies to attract and retain top talent. They include:
- Who should own and lead strategic talent planning, processes, and experience in the finance function? Why?
- Who makes up the critical workforce segments of your finance function?
- What specific measures do you use to attract, develop, and retain these critical workforce segments?
- What knowledge, skills, abilities (KSAs), and experiences do you need now from a technical, behavioral, and leadership perspective?
- How will you determine that these capabilities evolve as work environments change and evolve themselves?
- Why would somebody join your company’s finance department?
- Why would employees choose to stay?
- What makes your finance function a career destination rather than a career weigh-station?
- What opportunities you provide for career development and advancement?
Whether you are seeking talent for the finance division of your company or qualified engineers for your manufacturing segment, Kunkleman’s suggestions could make a huge difference in the success of your recruitment and retention strategy.