Key Practices in Talent Supply Chain Management

kellyocgLast week, I had the pleasure of joining KellyOCG for its first analyst summit in London. For those of you who aren’t familiar with KellyOCG beyond general brand recognition, it’s the outsourcing and consulting branch of Kelly Services – a longtime provider of staffing services for temporary, temp-to-hire, and direct-hire talent.

Having been in business for nearly 70 years, the folks at Kelly have plenty of experience helping clients tackle the challenge of talent from multiple angles: contingent workforce strategies, business process outsourcing (BPO), recruitment process outsourcing (RPO), and more. But while a lot of companies offer BPO and RPO solutions, KellyOCG has an interesting take on how organizations should be thinking about all the pieces that contribute to talent in the modern world: talent supply chain management (TSCM).

Ok, so maybe it’s not wholly new. Anyone familiar with Peter Capelli’s work (honestly, you all should be) has probably heard the term before. In layman’s terms, TSCM is a forward-looking approach to HCM that monitors internal and external labor and talent trends in order to optimize efforts to acquire, develop, and retain talent through multiple channels. Essentially, it’s workforce analytics meets integrated talent management with a heavy dose of contingent workforce management.

While there are several things that contribute to success in talent supply chain management, KellyOCG has targeted three things in particular:

Diverse Sourcing Strategies and Staffing Models

When we talk about sourcing in talent acquisition, we’re usually focused on where and how to source. Even then, most sourcing strategies focus almost exclusively on full-time employees. According to Brandon Hall Group’s latest research in talent acquisition, nearly one-third of companies aren’t using contingent labor at all – and 30% of those that do use contingent labor rely on temp workers to fill gaps while looking for permanent solutions.

KellyOCG thinks there’s a fundamental question we should be asking ourselves, and I agree with them. “What kinds of talent should we be sourcing?” As presented in its model for TSCM, there are five categories of talent: Temporary staff, independent contractors, service providers, alumni/retirees/interns, and full-time employees. By focusing only on the latter, we’re limiting our options – and our operational capabilities. It leaves organizations with a static talent supply chain, which isn’t agile, adaptive – or competitive. Each category of talent has its place in a modern talent supply chain, and finding the right people requires diverse sourcing strategies.

Alignment across HR, Operations, and Procurement

This one’s a doozey, and has plagued organizations for decades. KellyOCG correctly called out the business imperative of a strategic talent plan that spans the organization, giving departments direct insight into near- and long-term goals so they can work together to effectively manage the talent supply chain accordingly. And because effective TCSM relies on ongoing collaborative efforts, governance and ownership are also critical for maintaining alignment.

As cited in Brandon Hall Group’s most recent State of Talent Acquisition report, however, 64% of organizations are operating without even a high-level strategy in place to guide their hiring decisions and initiatives. Nearly one-quarter of organizations aren’t planning for talent needs of any kind. Lacking both renders any effort to build a steady supply of talent next to impossible, as evidenced by data from our Talent Shortage and Hiring Practicesreport wherein “building talent pools and communities” was rated as one of the greatest challenges in talent acquisition today.

KellyOCG certainly has its challenges on this front, but the team is tackling it head on – both in thought leadership and with its implementation and service delivery model.

Effective Workforce Planning and Analytics

As KellyOCG sees it, workforce analytics and planning are the lynchpins of any effective corporate talent strategy. I agree, but the unfortunate reality is that data-driven recruiting is still just a pipe dream for most organizations. According to Brandon Hall Group’s 2014 Workforce Management Study, more than half of organizations still have no workforce planning capabilities or only focus their planning on near-term operational needs like scheduling.

The most immediate limitation of effective workforce planning and analytics capabilities is a lack of technology – but this is changing rapidly as more vendors are investing in this critical area. In fact, KellyOCG gave a live demo of its analytics and reporting tool that I would say ranks among the top five solutions I’ve seen to date.

While it’s clear there’s much to be done before the concept of TSCM catches on in the mainstream, I won’t be surprised to see more high-performance talent acquisition strategies leveraging best practices in supply chain management just as they have with marketing. As I continue digging into the data from my Talent Shortage and Hiring Practices research, I’ll be looking closely at how organizations are thinking about talent supply and demand – and how they’re rising to the challenge.

Kyle Lagunas, Talent Acquisition Analyst, Brandon Hall Group

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