Managing Talent in Uncertain Times

In uncertain economic times, such as we are now experiencing, companies should resist the temptation to indulge in indiscriminate headcount reduction to save money. This kind of short-term thinking has negative long-term consequences: it may damage the company’s brand with employees and may even mean that the company lacks the right skills to take advantage of new opportunities when conditions change.

One fact is evident: companies have to cope with fluctuating economic cycles. Accenture’s High Performance Business research has shown that high-performance businesses consistently outperform their peers over sustained periods and across business cycles. One of the reasons that these companies outperform competitors even in down cycles is their ability to innovate continually—and this ability relies heavily on the right people. In other words, an organization’s talent management is critical to its ability to achieve high performance.

The pressures on companies come from a variety of sources, and executives must be wary of following tried-and-trusted strategies. More innovative—and effective—approaches to dealing with talent must be adopted to help companies manage for the downturn while positioning themselves for growth and high performance over the long term. An additional question is whether they will be able to implement their strategies quickly enough to create a sustainable competitive advantage.

In challenging times, acting quickly and decisively is critical. However, decisions will have long-term as well short-term implications—executives must remember that the obvious course of action could have negative long-term consequences.

Specifically, executives need to bear in mind that the current economic downturn is only one phase of the ongoing business cycle. Other factors such as the globalization of the labor market, changing workforce demographics and the shortage of skilled workers will continue to affect the labor market long after the economic climate improves.

Accenture believes there is opportunity in adversity. Companies that respond quickly with innovative actions will reap the greatest benefits—both now and in years to come.

Authors
Peter Cheese is managing director-Talent & Organization Performance, Accenture. Cheese, who has more than 25 years of experience in consulting, works around the world with clients in all industry sectors. He speaks at a wide range of conferences and events and is the coauthor of The Talent Powered Organization: Strategies for Globalization, Talent Management and High Performance (Kogan Page, 2007). He was recently named one of Consulting magazine’s “Top 25 Consultants” for 2008.

David Gartside is managing director-HR Transformation Consulting, Accenture. He has more than 10 years’ experience in helping clients envision their future HR operating models and transform their organizations to achieve the vision. He specializes in large-scale global transformation programs that affect all aspects of an organization’s HR capability, from implementation of new HR information systems to managing the HR-influenced spend and supporting the talent management agenda. Previously, he was Accenture’s HR Transformation lead for Europe, Africa and Latin America. He understands the geographic complexities that companies need to overcome to drive a global HR agenda.

David Smith leads Accenture Talent & Organization Performance in North America. He specializes in designing and developing talent and organization performance strategies and solutions for clients. He has more than 18 years’ experience in helping Accenture serve global high tech, communications and media clients. Smith is a frequent speaker at industry conferences and events. He is coauthor of a new book titled The Workforce of One: Revolutionizing Talent Management through Customization to be published by Harvard Business Press in mid-2009. David holds a master's degree in business management and a Bachelor of Science degree in engineering.

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