This is my first blog entry as president of SumTotal, so I’d like to begin by letting our customers and employees know how honored I am to be part of this team and to serve such a diverse and forward-thinking group of companies.
Throughout my 25+ year career, I’ve built a reputation as a straight shooter who focuses intently on meeting needs—the needs of my customers, my colleagues, and my organization as a whole. Joining the field of talent development, then, is a natural fit for me. I understand what drives the workforce and how critical it is to bridge skills gaps. We simply cannot meet needs, let alone grow profitability, unless we commit to the ongoing fortification of our greatest asset: our employees.
To me, and to many, this is a pretty straightforward idea. When we allocate the right resources and efforts toward developing our talent, we set ourselves up for greater business success. Why, then, are we finding so many organizations that fail to commit the appropriate energy to talent development? (In their July 2009 factbook, Bersin & Associates estimates only five percent of companies have “clear strategy with mature and integrated processes….”)
You might be hearing this discussed as the “70/30 paradigm,” whereby companies find themselves straddling a rather lopsided chasm. On one side, they’re throwing 70 percent of their budget toward their employees, through salaries, benefit expenses, and other HR-related tasks. Yet on the other side, when it comes to pushing value—and building the strength required to create value—the same companies are only offering 30 percent of their attention. It seems that, even though we know our people are worth something to the organization, we still can’t envision them as our value generators. Instead, we look to the immediately apparent drivers of revenue, like product sales or service offerings, which aren’t eating up anywhere near as much in costs. This simply does not make sense. We have to establish a vision for talent development.
Consider this: When you put money in the stock market, you do it with the anticipation that your original investment will actually increase. So you don’t ignore your assets. You monitor them, manage them, fine-tune them. Talent development is no different. You invest substantially in your employees—more so than anything else in the company—so you must effectively guide them if you want them to deliver the greatest possible value in return.
We’ve just delivered the first installment in our latest eBook, and it focuses on this 70/30 paradigm. The chapter reminds us that our talent—when properly attended to and developed with an integrated approach—can be a tremendous source of tangible value.
I hope when you read this chapter, you’re prompted to think about the purpose of talent development, and how best to balance your attention-to-budget ratio. In short, I want you to make the most of your workforce investment.
