Human Capital Innovation (Part 1): Technology, Talent and a New Playbook for Organizations

In Part 1 of this three-part series, we address organizations’ changing requirements for how work is delivered, executed and managed in an increasingly digitized and networked business environment. Part 2 will address change management and how organizations must realign to the values (and value) of emerging talent sources — millennials, retired baby boomers and everyone in between. Part 3 will analyze a perhaps surprising obstacle for organizations to adopt the new rules of the new game.

Human Capital Innovation What Winning Organizations Do

C-level executives, hiring managers, HR professionals, procurement directors and contingent workforce management practitioners at top-performing companies are recognizing that the way of engaging and leveraging talent is changing. They realize that ongoing high performance and competitive advantage require an entirely new approach to meeting their organization's needs for specialized, knowledge (i.e., business) talent — one that supersedes traditional work arrangements (e.g., “permanent” employment, stalwart consulting firms, staffing agencies) and organizational models.

A range of factors outside of companies — including new technology and evolving external talent demographics — are radically and rapidly changing the game of sourcing, engaging and leveraging professional business talent. Technology has made it possible for companies to engage external talent resources in an efficient and cost-effective way that typically required working through outside firms and agencies. One sees this in the rapid growth of online talent marketplaces and work intermediation platforms.

At the same time that technology is disrupting how companies engage talent, a growing pool of independent, elite knowledge talent (consultants, experts and others) is disrupting whom companies can engage. From former consultants at traditional firms to former industry executives to retirees looking for project-based engagement with their former employers, the growth of this population of independent knowledge talent is accelerating.

The organizations that will enjoy strategic advantage and superior performance in the future will not be the ones that stand still and wait to see what happens as the world of technology and talent swirls around them.

Winning organizations will proactively adopt the new human capital paradigm that goes far beyond tweaking traditional workforce sourcing and engagement approaches. Human capital innovation means riding the wave of digitization and embracing an organizational transformation of how specialized, top talent is directly sourced, engaged and integrated with internal teams and capabilities.

Emergence of Project-Based Human Capital Management

High-performing organizations must be agile. They must demonstrate speed and efficiency in optimizing their core businesses and in attacking new market opportunities. They must take the right resource and match it up against the right business need at the right time.

Many companies are already moving in this direction by identifying elements of roles that can be distilled into discrete and focused projects that can often weave together external talent and internal resources. Accordingly, organizations can no longer simply rely on traditional talent sourcing and engagement models that can be slow, unnecessarily costly, and misaligned with what talent and contributions are needed for successful projects.

Managers of winning organizations already understand the need to achieve alignment between the new requirements of their business and the specific talent and deliverables that will meet those requirements in the form of project-based work. Furthermore, those managers understand that:

  • Projects are critical to the success of the business and must be executed with precision and efficiency.
  • Getting the right talent on the spot for project-based work usually means looking outside of the organization to independent consultants and small boutique consultancies.
  • When projects conclude and that talent is released, the relationship between the organization and the talent should be maintained so that the organization can take advantage of the talent’s specific expertise and their acquired organizational knowledge in the future.
  • Making it all happen cannot be achieved without the right enabling technology solutions to help organizations source and engage the right talent, on demand.

That said, savvy managers understand that simply utilizing the right technology is not enough. The organization must change in many different ways — not only moving beyond traditional sourcing and engagement models, but also revising some core organizational norms. This is a topic that will be addressed in our next piece.

All of the above not only describes what is already happening in some organizations that are playing offense today, but also provides a roadmap of sorts for other organizations that may be ready to go on the offensive.

Conclusion

Human capital innovation means playing in an entirely new game that goes beyond traditional models of workforce planning and management, talent acquisition, staffing, big consulting, etc. It is a major shift that reflects how organizations are evolving, becoming more agile, and operating and trying to grow in a business environment of new technology and new ways of sourcing and engaging talent, expertise and skills.

But the new human capital innovation game encompasses not only changes in technology and talent demographics, but also the adaptation of organizations to these new conditions and opportunities. Because of the rate and extent of changes, organizations that play defense (“wait and see”) and do not begin to embrace and appropriate this new paradigm will do so at their own peril. In contrast, high performance organizations, that plan to continue to perform, are already in the game and going on the offensive, taking the lead on the future field of work.

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