Taking a proactive risk management approach to talent

What does business risk look like in 2022?

B2B business insight company, Raconteur – in its recent business risk outlook publication – aimed to quantify what’s keeping business leaders up at night.

Unsurprisingly, close to half of risk experts (42%) identify the “consistently volatile” global picture and 49% of CEOs cite cyber security as their greatest concern, followed by health risks and macroeconomic volatility .

However, a consistent risk theme in the Raconteur report focuses on that most basic commodity: people.

Shortage of labour is highlighted by CFOs as the biggest risk in 2022 , while 44% of corporate board members point to hiring and retaining talent as “important to their company’s ability to grow” this year . A similar quantity of CMOs (43%) see talent and labour issues as 2022’s “biggest challenge” .

So, how should companies tackle the risks posed by the talent conundrum?

Tying talent to business strategy

At the most basic, strategic level organizations need to know where they’re going, otherwise they will never hire the right talent.

Talent acquisition is not a rapid process. That means you can bring in “bodies” but if they’re not the right ones it can impact productivity significantly. Adding just one person that doesn’t fit into an existing team can have a detrimental effect.

Equally, plans to develop new products and services are “dead in the water” without the right talent.

Managing the talent risk

The latest edition of Management of Risk (M_o_R 4) guidance acknowledges that an organization’s people are its strongest asset. And part of the best practice’s focus on people explains the value of a positive risk culture.

In the context of talent, shaping a supportive risk culture sends the message that “we’re all in this together”.

Recognition of people’s performance and contribution is vital, with praise driven from the top down which can change the way staff feel about their role and longevity with the organization.

However, this must be backed by building individual competence through training and development. This willingness to invest in talent shows a company’s belief in its people – and the business will likely see a corresponding employee commitment to go above and beyond.

Also, adopting a risk-based leadership approach ensures that the organization’s objectives are clear and well-communicated. Together with mechanisms for two-way communication between staff and leadership, this helps establish staff belief in the future vision of the company.

Since the Covid-19 pandemic – and a general shift to hybrid working patterns – there is also an ongoing need to manage the risks relating to team well-being. For example, not everyone thrives on working permanently or semi-permanently at home. So, holding informal, social meetings with remote teams at least once per week helps people remain connected with colleagues.

The people-focused considerations in M_o_R 4 reflect the workplace evolution, how employers treat their people and the importance of a happy workforce.

Online training and development

Another by-product of the pandemic has been the embrace of an online training and certification industry.

While there is still a place for classroom training, the online offer has enhanced and supported corporate training and development. Trainees can now attend online courses with the comfort, convenience, and cost-effectiveness of home – and people generally learn better when they’re relaxed.

During the online training process, it’s easier for the trainer to have discreet communication with candidates to check they’re OK and there’s the ability to cherry-pick people for break-out rooms to generate the most positive learning experience. And, often, training is recorded for reviewing later.

In addition, online examinations take away the risk of heightened stress when people need to be in a certain test centre location and travel problems get in the way. Instead, candidates can choose their own time of day to take an exam.

“Great resignation” or great retention?

Employers today need to face the fact that employees have more opportunities and the temptation to “jump ship” to a different job is a reality for them and a real risk for organizations.

However, by treating talent as a risk and opportunity to manage proactively, companies can mitigate the twin issues of losing talent and getting the right talent through the door.

It’s about having a longer-term view when planning for talent acquisition and retention across the range of skills and competencies the company needs today.