Global talent acquisition and management firm, Alexander Mann Solutions, highlights the need for firms to take a long term approach to people management, despite the perceived need for short-term objectives in a growing gig economy.
In response to a recent report from McKinsey and Company which reveals that companies with long term views outperform their peers, Alexander Mann Solutions urges HR teams to ensure a similar approach is implemented in talent management.
In its report, Measuring the Economic Impact of Short-termism, McKinsey finds that the earnings of firms which focused on long term planning over short term objectives grew, on average, 36 per cent more than other firms and their economic profit grew by 81 per cent more.
However, according to the talent experts, the sourcing and management of people is often controlled on a short term basis due to the ambiguity of the gig economy.
Lisa Forrest, global head of talent acquisition, at Alexander Mann Solutions, explains why this approach could damage the future growth of those firms committed to long-termism.
Forrest says, ‘As more professionals take up the ‘gig’ employment option that an increasingly flexible business environment allows, it is arguably natural to see more companies focus on short term hiring needs. And with millennials – who are more likely to spend less time with one company than other generations – set to make up a significant portion of the workforce in the future, it’s likely that we’ll see an increase in short-term talent ‘fire-fighting’.’
She adds, ‘However, given the results of the McKinsey research and the undeniable fact that competition for top talent is heating up, a company’s success will be heavily determined by its ability to plan for skills requirements in the long term.
‘Rather than admitting defeat and taking a limited view on talent management, firms need to rethink their approach and maximise the tools available to them in order to develop people strategies that are both relevant to existing needs and flexible enough to meet future demand.
‘Predictive analytics tools, for example, allow an organisation to constantly identify skills needs across the business, any shortages of talent and potential new hires on both a short and long term basis.’