Employers Lack Bench Strength to Sustain High Performance

Published: Jan 24, 2019
Modified: Mar 26, 2020

By Kevin Martin

The high market performance that top companies have experienced over the past few years will be challenged in the future without attention to the talent pipeline, according to data from the Institute for Corporate Productivity (i4cp), a leading research firm that discovers the people practices that drive high-performance, and AMA Enterprise, a specialized division of AMA (American Management Association). In its annual study of issues that employers perceive as most important, yet are least effective at managing, i4cp reveals a glaring reality: Most employers do not have the internal bench strength of talent needed to sustain high-market performance.

While job growth has slowed recently on a broad scale, most experts believe the hiring climate will improve in the coming months as a result of general improvement in the economy, among other factors. When that happens, top companies need to be prepared for attrition in two key groups: High-performers and those who will soon be eligible to retire. This, coupled with talent shortages in specific disciplines and geographies, is creating skills gaps that are further widened due to the inability of organizations to adequately replace the institutional and experiential knowledge that is walking out the door.

The i4cp/AMA Enterprise study of nearly 1,400 executives worldwide reveals specific actions organizations intent on sustaining high-performance over the next decade should take:

  • Build deeper and broader pools of highly-targeted talent—only one in five employers has competent successors ready to fill executive-level roles and even fewer (15%) are prepared with successor candidates for mission-critical roles that extend beyond the executive level.
  • Improve leadership development skills with a focus on better interactions and communications—only 27% of employers indicate they are effective at developing leaders, and they are getting worse at it. The influx of Millennials as well as the move to flatter, more matrixed organizational structures, dictates the need for improved skills in areas such as coaching and the use of technology to collaborate effectively.
  • Fully understand what supports the organization's strategy and culture, effectively communicate this, and reward it—25% of organizations are effective at measuring and rewarding results and only 20% are effective at doing the same with behaviors. The behaviors of executives and middle managers have a very high correlation to market performance.

The Top 10 Critical Human Capital Issues: Enabling Sustained Growth Through Talent Transparency report highlights the point that one common success factor of high-performance organizations that helps accomplish these actions is talent transparency.

“Transparency is the common thread that correlates with effectiveness in virtually all human capital processes and programs,” said Kevin Martin, i4cp's Chief Research and Marketing Officer and coauthor of the report. “This applies to everything from ensuring people know where they stand with regard to their work expectations, progress, and development opportunities, to establishing accurate visibility into specific talent pools within the workforce, as well as building and communicating organizational strategy.”
A complimentary version of the report, which lists the top 10 critical issues facing high-performance organizations, including specific actions to take, is available.

You can further explore the issues raised in this article in these AMA seminars:
Strategy Execution: Getting It Done

Succession Planning: Developing Leaders from Within

About the Author(s)

Kevin Martin is chief research and marketing officer at i4cp.