Hackett Research Alert: Companies with Mature Talent Management Capabilities See 18 Percent Higher Earnings, Other Benefits
December 17 2009 - 9:30AM
Business Wire
Companies with more mature Talent Management capabilities reap
strong bottom-line benefits, including earnings that are 18 percent
higher than typical Global 1000 companies, according to a new study
from The Hackett Group, Inc. (NASDAQ: HCKT).
Hackett’s research found that the improved performance of talent
management maturity leaders enabled them to generate an additional
$673 million in additional EBITDA earnings for a typical Global
1000 company (with $26.38 billion in revenue). The study, which
examined the performance at more than 60 companies over a
three-year period, found that in addition to higher earnings,
leaders saw significantly improved net profit margin and greater
return on equity and assets.
Hackett’s research, which collected data on 19 measures of
performance and benefits to organizations, identified a wide range
of other enterprise-wide payoffs seen by talent management maturity
leaders. Leaders were able to create stronger organizations that
better motivate and manage their talent and had clear advantages
over typical companies in key areas such as the ability to create
and sustain strong corporate cultures, retain both overall
employees and specifically top talent, and plan for changes in
skills supply and demand.
From an operational standpoint, talent management maturity
leaders outperformed typical companies across an array of
efficiency and effectiveness metrics. Leaders showed superior
ability to increase overall employee engagement, faster recruiting
cycle time, and greater linkage of talent management to business
strategy. Their talent management professionals were also
significantly more productive than those at typical companies.
Hackett’s research offers a comprehensive profile of how talent
management maturity leaders operate differently from typical
companies, and how companies can improve their performance in this
area. Leaders achieved impressive results by creating an integrated
set of talent management capabilities aligned with their business
and talent strategies. They more carefully cultivate the
appropriate organization and culture, focusing on people-management
skills of managers and supervisors and employee engagement, the
research found. They have a greater focus on improving the
processes by which talent needs are identified and appropriate
individual staff are acquired, developed, managed, and measured.
Finally, leaders are more advanced at measurement and make more
effective use of technology to enhance talent management processes
and activities. While they don’t necessarily spend more, they more
effectively rely on technology to enable information access, track
talent management development, and enable improved
decision-making.
“It’s easy to find companies that feature talent management in
their strategic plans and reports to shareholders. But truly, most
do little more than pay it lip service. They stick to the basics
because they don’t truly understand the impact of improving their
talent management capabilities,” said Hackett HR Advisory Practice
Leader Stephen Joyce. “With this research we’re clearly quantifying
the price most companies pay for their lack of commitment. By
ignoring the strategic value of talent management and failing to
develop a comprehensive program that drives top performance in this
area, companies are missing the opportunity for a triple payoff –
an enhanced bottom line, better performance across the enterprise,
and improvements in specific talent management processes.”
According to Hackett Managing Director of HR Transformation
Harry Osle, “The kind of results we’re seeing in this research are
very achievable. But companies need to start with a comprehensive
transformation effort, to free up both staff and budget. They then
can utilize the freed up staff and budget to drive significant
talent management improvements. We’ve worked with companies to
drive improvements in key talent management areas such as
succession planning, recruitment, and learning and development, and
seen them generate significant cost savings while also improving
effectiveness. These companies were better able to attract
high-quality staff, retain key talent, and develop the skills they
need to support strategic business goals, and the focus on people
also has a measurable impact on business performance.”
A complimentary abridged copy of this research is available,
with registration, at the following URL:
www.thehackettgroup.com/tmmaturity.
About The Hackett Group
The Hackett Group, Inc. (NASDAQ: HCKT), a global strategic
advisory firm, is a leader in best practice advisory, benchmarking,
and transformation consulting services, including shared services,
offshoring and outsourcing advice. Utilizing best practices and
implementation insights from more than 4,000 benchmarking
engagements, executives use Hackett's empirically-based approach to
quickly define and prioritize initiatives to enable world-class
performance. Through its REL brand, Hackett offers working capital
solutions focused on delivering significant cash flow improvements.
Through its Hackett Technology Solutions group, Hackett offers
business application consulting services that helps maximize
returns on IT investments. Hackett has worked with 2,700 major
corporations and government agencies, including 97% of the Dow
Jones Industrials, 73% of the Fortune 100, 73% of the DAX 30 and
45% of the FTSE 100.
Founded in 1991, The Hackett Group was acquired by Answerthink,
Inc. in 1997. Answerthink was renamed The Hackett Group, Inc. in
2008. The Hackett Group has global offices in the United States,
Europe and Asia/Pacific.
More information on The Hackett Group is available: by phone at
(770) 225-7300; by e-mail at info@thehackettgroup.com; or on the
Web at www.thehackettgroup.com.
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