War for talent


The war for talent is a term coined by Steven Hankin of McKinsey & Company in 1997, and by Ed Michaels, Helen Handfield-Jones, and Beth Axelrod, Harvard Business Press, 2001. The war for talent refers to an increasingly competitive landscape for recruiting and retaining talented employees. In the book, Michaels, et al., describe not a set of superior Human Resources processes, but a mindset that emphasizes the importance of talent to the success of organizations.

Demographic

The war for talent is intensified by demographic shifts. This is characterized by increasing demand along with decreasing supply. There are simply fewer post-baby-boom workers to replace the baby-boom retirement in the US and Europe.

Knowledge work

While talent is vague or ill-defined, the underlying assumption is that for knowledge-intensive industries, the knowledge worker is the key competitive resource. Knowledge-based theories of organizations consistently place knowledge workers as a primary, competitive resource.

Definition of ''talent''

Talent is never explicitly defined in the book, though the Preface notes, "A certain part of talent elude description: You simply know it when you see it." After several further caveats, the authors go on: "We can say, however, that managerial talent is some combination of a sharp strategic mind, leadership ability, emotional maturity, communications skills, the ability to attract and inspire other talented people, entrepreneurial instincts, functional skills, and the ability to deliver results." The authors offer no outside support for this assertion.
A 2006 article in The Economist, which mentions the book, notes that, "companies do not even know how to define “talent”, let alone how to manage it. Some use it to mean people like Aldous Huxley's alphas in “Brave New World”—those at the top of the bell curve. Others employ it as a synonym for the entire workforce, a definition so broad as to be meaningless."

Relevance during economic downturn

The 'War for talent is seen by various sources as becoming irrelevant during economic downturns. However, there have been highly visible talent poaching by solvent firms of others who have economic hardship.