There are many proof points to support the value of executive coaching as part of a comprehensive talent management strategy. This report from consulting group McKinsey & Company takes those proof points several steps further. It demonstrates that the value of managing human capital is as high as managing financial capital. Referencing its most recent global survey, the report opened with:
According to respondents, organizations with effective talent-management programs have a better chance than other companies of outperforming competitors and, among publicly owned companies, are likelier to outpace their peers’ returns to shareholders.
Additionally, organizations surveyed were highly critical of their talent management efforts with only five percent of respondents saying their talent management functions had been very effective at improving company performance. However, when it’s working, it’s working phenomenally, companies with very effective talent management are six times more likely to report higher total returns to shareholders (TRS) than those that don’t.
McKinsey notes three critical success factors that help create the outsized contribution effective talent management can make to an organization. First, is rapid allocation of talent. Just 39% of survey participants believe their organizations quickly reallocate talent as priorities evolve. At public companies that quickly reallocate talent, survey participants are 1.5 times more likely to report better TRS than participants working at slower allocation companies. With the rapid pace of change and innovation in today’s business place, supporting and developing flexible talent ready to take on new opportunities and challenges is crucial to success.
The next critical success favor is ensuring HR has an active role in creating a positive experience during the employees’ entire tenure at an organization. Just 37% of those who participated in McKinsey’s survey saw this happening, but those who do are 1.3 times more likely to claim their organization outperforms competitors. Offering scalable yet bespoke solutions like Pluma’s approach to coaching enables HR partners to do just this, bring a positive development experience to life for their teams.
Building an HR team that understands and supports the organization’s strategy and direction is the third critical success factor. When a strategy-focused HR team is in place, respondents are significantly more likely to report their company outperforms.
Much of the report aligns with what we hear daily at Pluma, our HR partners are always looking for solutions that will better prepare and inspire their organizations. When investments in initiatives that drive those elements are made, clear ROI is visible in the bottom line.
To learn more, read the whole report here, or check out the excerpt below.