Using Talent Management for Success

Tue, Jan 26th, 2010

Talent Management is a crucial part of the Tesco success story, according to Therese Procter, HR Director, non-food division of Tesco. Without it, Tesco would not have benefited from the growth it has enjoyed domestically and internationally. The company bases its credo on the former Johnson and Johnson credo devised 65 years ago, which determines that the business stands or fails on :

the commitment of its people
the strength of the communities around which we work
financial performance

The return to shareholders comes lower but only because it follows on from effective implementation of the above.

Tesco are currently focusing on the following non-food areas: .com, banking and mobile. However, all sectors are dependent on company values which are pivotal to achieving the above.

In the .com business this is because customers are becoming more and more demanding. Nowhere is this more obvious than in internet and telecoms services. Customers buy not just the service but the phone as well: an analogy is that it is not just the sofa which is not being purchased but what is on it.
In the banking business, the need is different, but th concept of values is not. What people want from a bank is trust and dependability
In mobile what people want is flexibility and value

However, all three businesses have the following in common:

they are not in traditional supermarketing areas
they are sectors which are easy to follow
sectors not necessarily dependent on existing technology

Re-invention of these areas under the Tesco brand is key: there are several precedents; including

IBM transformed themselves from black box providers to a professional services organisation
Lucozade was a children's drink and is now marketed as a healthy nutricious drink for adults.

But, delivery is now more important: for example, the performance of the corporate "brand" is now more dependent on delivery. It is in this key area that the business has been transformed more than ever: boundaries between silos have now been largely broken down resulting in improvement in the overall performance. How has this been achieved? Andrew Higginson, Managing Director of Tesco services, considers that it has been due to a "top-down" approach. In doing this, several key objectives can be achieved;

Identifying leaders
Creating the right environment in which people can flourish
Building teams to reflect this environment
Monitor and support this alignment with care

Partial leaders are not necessarily natural full leaders but need to have the potential to be full leaders. However, their potential as real leaders might only shine through when they have a balanced environment in which they work. Decisions have to be a combination of tough and value based decisions . It needs to be a blend of head/heart and guts/determination The most successful leaders are challenging in their sections because they combine "heart" and "head" leadership: above all they have values led behaviour.

The Tesco approach is to :

Identify potential leaders

Immerse in the core business

Encourage the development of new ideas

Create plan/vision of business including the new idea

Avoid silos: integrate and seamless if possible

Also, encourage with bonuses but link them to the "steering wheel" approach and profitability.

Tesco follows the big three laws of Talent Spotting:

1. Be aware of potential Talent Dislocation. As Ian Botham, the cricketer, famously demonstrated, being outstanding in one area does not guarantee being a winner in another field. Either he/she may not be fulfilling their full potential in a current role or moving a well performing talented individual to a new area will diminish their performance.

2. Talent Myopia. High potential achievers may shine through in low performing sectors. Ensure that when assessing talented people, their circumstances are considered fully and look for specific circumstances outside individuals' control which might cause performance shortfalls

3. Associative networking Check who the high performers network with: talented people like to work with similar people, sticking together like lumps in a mass of mediocrity.

And the Top Ten Tips:

1. Values. People perform best when there are strong linkages between corporate values and individual values. Where these linkages are weak, ensure that sufficient time is made available in aligning them.

2. Genuine leaders are complete leaders. When assessing individuals for leadership qualities look at what they have achieved and how they managed it

3. Action vs Words

4. Ensure full transparency in assessment

5. Talented people are genuinely multi-disciplinary and "silo-busting"

6. Talented people can create a difference, while at the same time ensuring continuity

7. The most successful organisations have a mixture of home grown talent and imported talent, while at the same time avoiding the pitfalls of talent dislocation

8. Look elsewhere. The most successful organisations are constantly tapping into labour markets not previously explored.

9. Reward re-education. Benchmark against the familiar, even organisations involved in charitable giving. Any organisation can set a Gold Standard: the skill is in finding and identifying it.

10. The most successful organisations have built trust and reputation with all stakeholders, from customers to shareholders

In retail, you need to be viewed as a trusted friend rather than a predatory seductress.