Originally posted on on the e-Sourcing Forum [WayBackMachine] circa May, 2008.

A recent article in Supply Chain Digest sung one of my favorite tunes — talent. The latest publication to note that there is a current shortage of talent and that it’s only going to get worse, it also noted that only a few companies have disciplined and sustained programs for supply chain talent development. Furthermore, most of these companies are using approaches that have worked in the past, which may not be suited to the unpredictable global environment of the present, and, most importantly, the future.

The article quotes Wharton Business School Professor Peter Cappelli who states that the process of developing the talent and skills needed for the future should be similar to today’s supply chain thinking. The key capability required by today’s companies is the ability to react dynamically as needs change, just as agility and the ability to “sense and respond” increasingly define supply chain excellence. According to Cappelli, managing supply chains is about managing uncertainty and variability. This same uncertainty exists inside companies with regard to talent development.

Cappelli equates a company’s current talent pool to the way a company thinks about its current supply chain inventory — you need what you need, but having too much is not a benefit but a cost. Cappelli sees the same thing when companies talk about having a “deep bunch” of talent, but sees the problem as being much worse. That’s because an inventory of talent is much more costly than an inventory of widgets — talent doesn’t sit on the shelf like widgets do. You have to keep paying talent. And, as the article clearly notes, the best way to have a piece of talent walk away is to tell it to sit on the shelf and wait for opportunity.

The article also outlines three keys to a supply chain approach to talent development:

• Be flexible in matching talent to needs
  Don’t arbitrarily lock talent down by division or business unit.
• Flexibly mix in-sourcing and outsourcing
  Companies should use adaptable models of internal development and then bring in outside help when internal talent can not meet the need.
• Use simulation and scenario analysis
  Don’t base your hiring plan on a static model of expected future needs. Look at all possible market developments, associated talent requirements, and create a plan that can flexibly adapt to different needs.