August 22, 2022

Talent Efficiency: How to Measure it & Why it Matters

Talent Efficiency article

Organizational success is increasingly tied to a company's ability to utilize the talents of its workforce efficiently. A variety of factors can contribute to this, including the company's overall strategy, the composition of its workforce, and the effectiveness of its HR management practices. While there is no definitive way to measure talent efficiency, several indicators can provide insights into how well a company is leveraging the talents of its employees. These include measures of employee engagement and satisfaction, productivity, and turnover. By monitoring these indicators, companies can better understand their talent efficiency and take steps to improve it.

Over the past decade, several trends have emerged that have pushed organizations to be more efficient with their resources. These include the global economic crisis, the rapid advancement of technology, and increasing costs associated with healthcare. During this time, organizational efficiency has been increasingly tied to a company’s ability to leverage the talents of its workforce. In an era of global competition, technological change, and shorter product life cycles, organizational ‘efficiency’ has become a competitive advantage. 

But just how is this organizational efficiency improvement goal actually achieved?

Several Harvard Business Review articles have provided insights into this question, all pointing to the importance of human capital and the effective management of human resources. In particular, the article ‘Build Your Company’s Agility’ points out core competencies necessary for an organization to remain efficient: imagination, discipline, and compassion. These three competencies can guide the strategic management of human resources and help companies achieve greater agility.

The article suggests that organizations should focus on developing the competence of compassion, which refers to the ability to create a supportive culture for employees. This enables greater employee engagement, which in turn drives greater productivity and lowers costs related to turnover. Compassion also enables the development of the other two necessary strategic human capital capabilities – discipline and imagination. Discipline is the ability to create structure and optimize processes, which enables greater agility through simplified operations and complex problem-solving. Compassion, discipline, and imagination enable human resources leaders to build an agile organization.

To further investigate how human resources leaders are implementing these principles in their day-to-day activities, we've compiled 8 tips from leading human resources (HR) professionals what they’re doing to create more organizational efficiency. Their answers provide real-world insights and action steps for how HR leaders can improve their agility as well.

1. Establish a human-centered work culture

A leader in the HR industry responded by explaining that they have established a culture where all of their employees are equally valued. This helps in creating greater efficiency by reducing office politics and eliminating favoritism. It also helps the employees, as they are not subjected to work that may be beyond their capabilities or unsafe. This leads to a sense of pride, creating enthusiasm among the employees and improving the company’s reputation.

“We focus on creating a positive culture where everyone is empowered to take the lead and act. This creates a high level of efficiency as everyone works together towards a common goal with a positive attitude,” said Prashant Malavi, Managing Director at Genpact India.

2. Use technology

Many of the respondents agreed that technology could significantly improve efficiency. For example, AI can efficiently screen and filter candidates, while cloud computing can improve the functionality and accessibility of HR tools. An example of HR tools includes HR dashboard software to automate HR reporting.

“Using technology allows us to scale our processes and help millions of students, teachers, and schools across the globe. This could never be accomplished using paper and pen,” said Janice Johnson, Chief People Officer at Hotchalk.

3. Emphasize discipline

An employee’s attitude can greatly enhance efficiency, even when the appropriate technology and tools are readily available. For example, when screening and filtering candidates is a priority, the ability to engage in meaningful conversations during the recruitment process is a must. This can only be accomplished with discipline. Similarly, when HR leaders focus on building talent with specific skills and capabilities, they must establish clear employee goals and define what success looks like.

“You need to have discipline in screening candidates. If you don’t, you will receive a lot of candidates who don’t fit the job or your company culture. This will then take time to filter them out,” said Guy Galor, CEO of Prophet.

4. Train candidates to develop talent

“The most expensive resource in the world is waiting on the sidelines not being trained appropriately. Therefore, we teach students how to train themselves. We teach them life skills so they can develop their talents,” said Prashant Malavi from Genpact India’s Education and Development Foundation.

5. Charge fair fees

Charging fair fees will allow the company to sustain itself and ensure the product or service is available to as many people as possible. For example, when implementing HR tools, organizations must ensure they are not overpaying for functionality they don’t need. 

“When choosing an HR software, make sure it is not a super-walled castle. Ensure there are professional services included or alternatively, ensure you can get affordable professional services,” said Janice Johnson.

6. Be adaptable

Leading companies can be adaptable in the global marketplace because they have systems and processes that allow them to adapt to different cultures and regions. For example, when evaluating HR tech products, make sure the product is not US-centric and ensure it can adapt to different languages and countries 

Many leading companies are multilingual and have employees from different countries and cultures. Therefore, they need a system that can function in different languages and regional complexities, said Rony Levi from Tractivo Israel.

7. Ensure fair HR processes

Ensuring fair HR processes will help employees trust the organization and feel secure about the way problems are addressed. This also means avoiding arbitrary or unfair punishments when employees report misconduct. When employees see that HR practices are fair, they feel more trusting of the organization and are more likely to engage with the company further.

“Don’t try to do everything yourself. Get external help. Hire a head hunter—  not somebody you know. When you do that, you’ll find that you have more time and you do a much better job,” said Ilan Moscovitz, founder of Amos & Co.

8. Implement the best people-finding tools

People are the most important asset to any company. But with the war for talent as fierce as ever, finding and hiring the best employees is becoming increasingly difficult. There are new tools like CO.CAREERS Good Jobs Board, which features a built-in Applicant Tracking System. Hiring managers can apply for free here.

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