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Talent management has been a hot topic for a long time in both corporate and startup contexts. With constant evolution and new trials of disruptive ideas in modern management, it’s generally agreed that effective talent management can maximize the value of each talent, optimize human resources and improve business outcomes. According to a survey from McKinsey, the organizations with good talent management programs have more probability to outperform their competitors in the market.

There have been tones of theoretical analysis about modern talent management across different steps from talent acquisition to succession planning. In this article, what I want to discuss, is neither the general trends like digitalized recruitment process, data-driven workforce planning, nor the general strategies like flat hierarchy, DEI, but some of the real interesting practices of talent management that I have personally experienced, come across and heard of in European tech companies, as well as the feedback from their employees.

Flexibility

The flexible working arrangements are the most drastic change directly brought by COVID-19. However, what has been altered due to the pandemic is not only the working environment, the working culture, but also the mentality towards our daily working life.

1. Remote working

Once upon a time, the remote working or work from X policy is considered as a special employee benefit at only some pioneer companies. Some follow the nature of decentralized teams across multiple locations, some simply want to offer more flexibility given no change in productivity. As a practice that a minority of the organizations adopt, it plays a positive role in attracting talents in recruitment.

However, the Covid-19 pandemic has completely changed the landscape during the past two years. In Europe, it pushed "work from home" in the majority of the office-based companies nearly overnight, luckily aided by many supporting technologies like online communication (e.g. slack) online meetings (e.g. zoom), online brainstorming (e.g. miro), online planning (e.g. Trello), online project management (e.g. Asana), etc., covering almost every functionality of physical collaboration.

Is it really efficient? What is the major concern during remote working? Recently, the answer might be clearer than ever before from thousands of studies on the topic, as a vast majority have reported an increase in productivity and a decrease in burnout with a remote working policy. Research conducted by Catalyst also pointed out that it increases innovation by 63%, work engagement by 75%, organizational commitment by 68%. Following the positive feedback, there are more and more companies announced a permanent or semi-permanent remote working plan for their employees after the Covid-19 pandemic, including Facebook and Airbnb. When the home office becomes a norm, there are also companies deciding to take a step further to completely switch to remote-first working style and starting to enjoy the benefit of hiring internationally, eliminating the limitation of the local talent pool.

On the other hand, there are also many voicing up the necessity of physical contact with the team, for both trust-building and mental well-being. Many others state that having a daily routine of commuting draws a clear line between life and work. And some leaders also raise concerns about company culture building under a remotely working style. Therefore, when picturing the life after the pandemic, it is still mostly supported (82% from a Gartner survey) to have regular office life as the norm and the flexibility to work from X for a certain time as an option.

2. Time flexibility

Compared with working location, working hours seem to historically enjoy more flexibility, especially in tech companies. As long as you work 8 hours per day or 40 hours per week, many companies don't regulate how their employees distribute their working hours. Besides the most common timeframe roughly from 9 am to 6 pm, I have seen many developers prefer to work from 7 am to 4 pm. Many teams covering US business would like to start rather late. I personally also took 2 months working from 1 pm to 9 pm many years ago, in order to complete an intensive German course in the morning.

The flexibility offers full respect for different individual requirements, be it for family, for personal schedule, or simply for specific habits. However, I will not deny the certain delay caused by the differences in working timeframe, which is similar to when you work with a partner who resides on the other side of the world. On this point, I have also heard another powerful argument from a manager that I have worked with: Flexible working hours are not unconditional, but always with the premiss of team agreement and completion of your tasks. If one failed to do so, that’s the problem of his capability, not the problem of working hours. Actually, the company doesn't ever track individual working hours, which offers full trust to the employee. In return, the employees are adults, and we should be capable to control our own schedule to best fulfill our responsibilities.

Another type of flexibility lies in the number of working hours. There are practices from companies to give the options ranging form 28 hours per week to 40 hour hours per week, adjustable on a quarterly or semi-annual basis by employees themselves. This policy is highly beneficial for those who want to take professional exams, part-time MBA, or to start their own project on the side. You might argue this will lead to a negative impact on talent retention. True, but at the same time, promoting entrepreneurial spirit is what many tech companies are trying to do, which we will talk about more in detail later in this article.

3. Work-life balance

Offering flexible working locations and working hours are both employer attempts for better work-life balance, especially in response to the ever-growing needs of employees during the pandemic. From an employer's perspective, when talents start to reevaluate the priorities of life, and salary is no longer the most powerful barging chip to their changing aspirations, there is still one magic ingredient to thoughtful talent management — empathy.

Tech companies are in general pioneers in addressing work-life balance, and they started much earlier even before the COVID-19 hit — embracing flexibility, offering generous leave policies (e.g. unlimited holiday, summer Friday), providing on-site gyms and mental health sessions (e.g. consulting, meditation, nutrition courses) and many more. Apparently, it prevents high levels of burnout and increases employee satisfaction. Behind the scene, there is also the business rationale of higher productivity and talent retention.

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 Personal development

Effective talent management strategies are never only about compensation and rewards, but also fine-tuning other aspects of employee experience in the long-term to empower the best performance, where personal development comes to play.

1. Self-learning

Providing professional training and holding seminars have been a common practice for almost every company around the world. For certain industries, where professional certificates are highly beneficial, it is also common to have tuition reimbursement programs, like investment banking or consulting for CFA. These years, with the fast development of platforms like Coassemble, Trainual, LinkedIn Learning, there is a new trend for employers starting to invest in these online training tools to enable employee self-learning, for improving individual productivity, as well as internal mobility.

Employees could personalize their learning agenda with the topics that they are most interested in, ranging from coding to data mining, from negotiation to communication, from HR to finance, from business management to leadership skills… Instead of being assigned to take certain training, employees have more autonomy to choose what suits them best and are more accountable for their own completion of the courses.

This is especially important at a time when many industries are facing transformation. Take the automotive industry for example, since the competition slowly shifts from hardware engineering to software development, there is a natural change of the talent structure with different skill sets. The proactive employees would certainly take the chance to quickly adapt and develop other skills to meet the needs. This change is actually happening in every industry. According to a study, there will be a billion jobs, approximately 1/3 of the world’s workforce, which will be transformed by 2030 thanks to the technologies like automation and AI. Offering the learning opportunity is facilitating the employee to build a more sustainable career path.

The intention is beautiful, but the self-learning scheme hardly reaches its full potential on an organizational level. Since the scheme is completely autonomous, there are employees that have never taken any course, and many others have difficulties taking all the courses they want due to the tight schedule and heavy workload.

2. Peer learning

A culture of peer learning is what I have found in almost every tech company that I have come across, the easiest practice is internal sharing, given the diversified expertise and experiences of each employee. The sharing could be on professional topics like venture investment process, market research clustering, basics of python, or rather casual topics like funny mobile game privately developed, the experience of climbing Everest, the culture of Ramadan…this practice helps the employees to easily get to know their colleagues, more engaged with the team, and for an organization to identify talent needed for secondments.

Another type of peer learning has mentoring concept implanted. This mentorship program can be further divided into two different types: one is for skill development, the other is for career development. For the former, the employees can take any colleague within the organization as a temporary mentor for the skills that they intend to develop, like graphic design or online marketing. For the latter,  it is more systematically have one mentor guiding one or more talents on a long-term basis. The mentor will need to build trust with the mentee, understand their motivation and work satisfaction through open communication and provide advice or resources for their further career development. The mentors are normally the senior members of the company, and not necessarily the direct reporting line or manager of the employee.

Although there are indeed limitations from of mentor capability and scientificity for the individual match, I have still got a lot more positive feedback on long-term mentoring practice: ‘super helpful to have someone senior to talk with when I am struggling with my team problem’; ‘I feel my career goals are recognized regardless of my current tasks’; ‘I was provided with many useful resources for the skills that I needed’; ‘It provides me with a different perspective from different working functions’. Nevertheless, implementing this practice has a super high requirement of a trust culture within the organization. You might assume no one would choose their direct manager as their personal mentor to avoid conflict of interest, as they might touch sensitive topics or build a negative impression while being completely honest. But interesting enough, the managers with strong charisma are the most popular mentor choice for their team members.

3. Feedback system

Further from constant personal development, a fair and structured feedback system is the key to completing the cycle and the chain to direct ongoing career paths. It is easy to understand if you ever worked in a scrum team, the feedback follows the same logic of retrospective: celebrate the achievement, learn from the failure, and improve time and times again.

Many companies have initiated semi-annual or annual performance review sessions. What I want to point out is, the review can play a positive role only if it’s well-rounded and unbiased. It should neither solely be based on business performance nor only come from 1 or 2 individuals. A good practice is 360 performance review, which allows a group of coworkers who have worked together with you to provide both quantitative and qualitative reviews on different skills from communication, creativity, teamwork to leadership and company value alignment. Every employee will receive an aggregated score and detailed comments on every category of skills. This review offers rather objective insights into an individual’s strength as well the knowledge gaps, professional weaknesses and personal challenges. Is it painful to receive negative feedback? of course! But the more objective the feedback is, the less painful people will emotionally feel, and on contrary, the more useful it will be for your personal development. At least I have personally improved a lot in this way.

Furthermore, the feedback loop is a great retention tool for employers, as it provides more accurate insights of individual’s value to the organization, that enables the employer to give personal recognition to the individual and identify particular strengths from each individual for more agile internal mobility, talent allocation and team deployment. When it comes to promotion, there is no wonder how much more convincing it is when the decision is based on a well-rounded and unbiased review.

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Entrepreneurship

As mentioned earlier, encouraging employees to have their own project is somehow risky for talent retention, as they will possibly leave as the project matures. However, this approach is highly aligned with the particular company value. It defines what kind of brand image you want to build and what kind of talent you want to attract.

1. Empowerment

Promoting entrepreneurship can range from supporting small innovative ideas to supporting independent businesses. Encouraging innovation is much more widely applied in tech companies, as a strategy to stay on top of disruptive ideas. They try to boost creative thinking by taking the inspiring design of the office space, installing entertainment facilities like kickers or hosting an internal hackathon on a regular manner…To step further, the company can also support employees to initiate their own projects. Google’s 20% time rule is a good example, which encourages the employees to spend 20% of their time at work, to work on other projects that they think will benefit the company.

When it comes to real empowerment of independent business, it requires a lot more dedication in policy support and even resource investment. The concept can be also found in so-called intrapreneurship programs, the employees can use their regular working hours to develop their own ideas into a real business. Due to the employees' industry background and domain expertise, the majority of the ideas are still related to the companies’ core business, so that in the end the projects can be easily spun in. However, there are also cases that intrapreneurial projects successfully spun off as an independent business and the company stays as a shareholder. Besides, some other companies prefer to empower entrepreneurship by actively being the first pilot partner or the first paid customer of employees’ privately developed solutions when applicable. Employees are motivated to do things they are truly interested in, employers can also benefit from the innovations created.

2. Ecosystem

Clearly, the trade-off of being an entrepreneurial organization is talent retention. The departure of skilled employees is already a loss, further high turnover will surely translate into the high cost. However, if we zoom out to look at a longer timeline, the whole picture might be a bit different.

First of all, as there are more and more success stories coming out of the same company, the entrepreneurial employer brand will be gradually established within the industry, and the company will attract like-minded talents more easily, which directly saves the cost for recruitment. Additionally, apart from the funding that is available from the internal investment vehicle, many early-stage VCs also like to deploy networks in entrepreneurial organizations, so the good startup projects can easily enjoy better resources of funding for development, thus better chance to grow fast and to succeed. Moreover, supported by the alumni program, there will be better communication of information and recourses, as well as generations of exited entrepreneurs reinvesting their money and experience back into the new startups within the exclusive ecosystem.

Then what it brings back to the organization, is not only the reputation to attract more talents, but also the opportunity for the high-quality deal flow of investment, as well as a network of potential unicorns. Now…how do you feel about the trade-off?

There are actually a lot more innovative talent management practices been tried and implemented in different tech companies. Although they come with different formats, a general trend of being more talent-centric can be easily identified. Supporting employees’ well-being, fostering a learning culture, empowering personal success will ultimately reinforce the company value and improve the business performance. The virtuous circle is right underway.