A New Lens on Business Advantage: Human Capital Strategy and the Drive for High Performance

Today’s business challenges—acquiring and retaining new customers; applying innovation to stay ahead of the competition; managing change; improving productivity, driving growth—point to a business environment that is more competitive and global than ever before. What‘s the common denominator beneath these challenges? They focus an intense light on the need for differentiated human capital assets to execute or implement an enterprise’s strategies and respond to new competitive challenges.

Yet many executives across the globe express concerns about whether they have the skills, knowledge and experience internally to translate evolving business strategies into an effective human capital strategy. But making that translation—articulating business strategy in human capital terms across multiple dimensions of talent, leadership, culture and organization—is critical if companies are to succeed as 21st-century businesses.

Companies have always had some means—whether called HR, talent management or workforce planning—to put in place the people and skills needed to run the business. For several reasons, however, economic challenges and the speed of marketplace change have outstripped the ability of traditional HR planning to meet business needs. As a result, while many companies have in place an HR or workforce plan, it is frequently nowhere near robust or comprehensive enough to cover all of the critical dimensions of human capital.

A human capital strategy goes beyond the limited, though important, activities focused on the employee lifecycle—recruiting, training and rewards—and looks comprehensively at four interrelated sets of questions:

• Talent. What skill areas and capabilities will be needed to compete and grow our business? Where are the gaps between the skills we have and those we need, and how can these gaps be closed through new talent sourcing and development options?
  
  
• Leadership. What types of leadership capabilities do we need to sustain our business strategy? How will leaders be sourced and developed?
  
  
• Culture. What are the key cultural attributes of our company today? How does this prevailing culture affect performance and productivity, as well as the ability to attract and retain the right talent? What are the characteristics of the ideal culture aligned with our business needs, and how do we create and sustain that culture?
  
  
• Organization. What type of operating model can help us optimize the execution of strategy and the efficient use of resources? What is the organization design—structure, governance and reporting relationships—most conducive to the kind of business we want to be and the strategy we need to get there?

David Smith is managing director of the Accenture Talent & Organization Performance practice. Mr. Smith specializes in designing and developing talent and organization performance strategies and solutions. He has been a guest lecturer at Wharton Business School and Babson College and is a frequent speaker at industry conferences and events. In addition, he has authored and coauthored several articles and papers, and has contributed his viewpoints on talent management to various business media and industry publications. He is based in Hartford, Connecticut.

Yaarit Silverstone is the managing director responsible for human capital and organization effectiveness offerings within the Accenture Talent & Organization Performance practice. A consulting professional for more than 25 years, Ms. Silverstone has extensive experience diagnosing complex organizational performance issues and designing, implementing and sustaining human capital strategy and talent management solutions, as well as leadership development programs. Originally from South Africa, she is based in Atlanta, Georgia.

Adrian Lajtha is the London-based chief leadership officer for Accenture, responsible for the company’s strategies and programs around leadership development, succession planning, inclusion and diversity, corporate citizenship and human capital strategy. He is also a member of the company’s executive leadership team.

Accenture senior director Elizabeth Hopkins, and Accenture senior managers Lisa Finkelstein, Andrew James, Claudy Jules, Laurence Morvan and Punya Upadhyaya contributed to this paper.