It’s hard to argue against the concept of strategic integration.
Having related business units working closely together, rather than operating as independent silos, almost always increases efficiency, reduces errors, and improves overall results.
There’s no better example of what integration can accomplish than the modern-day supply-chain organization, which used to operate as four independent functions (purchasing; inventory management; warehousing; and shipping).
The integration of these functions into a single function with cross-activity analytics and shared goals turned an “overhead function” into a profit center at companies like Wal-Mart, Toyota, and Dell. The customer-service function also demonstrated the value of integration when it created single points of contact for customers using “customer contact centers” capable of addressing a wide range of customer needs from technical support to warranty registration and billing inquiries.
The result of all these innovations was a dramatic increase in customer satisfaction and loyalty/retention. City governments also strive to increase capacity, reduce errors, and save scarce resources when they closely coordinate police, fire, ambulance, and hospital services for handling emergencies.
When executives contemplate what function would benefit the most from breaking down silos and driving integration next, talent acquisition is almost always on their list. Given that numerous organizations are currently engaged in process reengineering efforts and that the budgeting cycle for 2010 is just around the corner, what better time could there be to start integration efforts?
While recruiting continues, requisition loads per recruiter are down and non-essential programs are on hold in many organizations.
Despite the temporary relief from massive requisition loads, executives are crying out for strategic moves and the application of new technologies seen by nearly everyone as relevant to talent acquisition. Growth of social networks and past experience with employee referral programs have led several executives in high-growth Fortune 200 firms to question whether traditional talent acquisition functions even make sense anymore.
One progressive CFO worked with talent acquisition leaders to develop a finance function-specific ERP with aggressive features that produced 80%+ of the function’s hires last year.
The Definition of Integrated Talent Acquisition
Integrated talent acquisition is an organizational design strategy whose primary goal is to break down barriers between like activities and bring economies of scale and quality management to the function.
It emphasizes the coordination of efforts, increased sharing of information, and group communications across several functions to increase speed, quality, and to reduce costs. The coordinated functions often include a mix of corporate functions including HR, finance, operations, business development, and outsourced service providers. In some cases, when the business itself is largely dependent upon the organization’s ability to acquire, develop, motivate, and retain talent, organizations have fully integrated activities across all functional boundaries into a single seamless process with accountability, shared analytics, and shared rewards.
Talent Acquisition Is Mostly Uncoordinated
It’s hard to make a strong argument against integration because working more closely together is so obviously a good thing, but that doesn’t make it common!
All too often, HR leaders are selected who rose to power vertically through a single function, most often training and development or HR operations, but occasionally talent acquisition.
The bias of said leaders creates a highly political environment where survival pretty much depends on “building your own empire” and masking reality to prevent easy replacement.
(I’ve even heard HR referred to as “Balkanized” – which is certainly not a compliment.)
It’s rare to find a talent acquisition function that’s truly integrated. In most cases, the “sub-functions” of talent management operate as semi-autonomous units, while in other more extreme cases the sub-functions operate as completely independent silos. I can’t begin to tell you how often I am met with blank stares when I ask talent acquisition professionals in companies with a formal talent management function to tell me what the function does!
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You can quickly tell whether talent acquisition functions are currently integrated by simply looking for the signs of close integration, which include shared metrics, interdependent rewards, cross-departmental rotations, cross-functional teams, and periodic joint meetings.
Problems Caused By Lack of Coordination
Few talent-acquisition functions are closely integrated. Some of the problems caused by this lack of integration include:
- Lost during handoffs. With independent functions all handling a small piece of what it takes to find, court, hire, and onboard a new hire, it is very plausible that candidates may be inadvertently “lost” when they move from one phase of the process into another (for example, when finalists are handed off to a background vendor, some may be lost at either end of the transfer process).
- No way to identify the origin of errors. When a macro level process is broken up into many smaller pieces, each owned by someone else, identifying the source of errors or delays in the overall process is nearly impossible. An example might focus on delays in time to fill. Without an integrated process, shared analytics, and single-point accountability, determining which sub-process (sourcing, assessment, background verification, or offer generation/presentation) produced a delay could be impossible.
- Mixed terminology. As candidates are passed off between sub-functions, they are confused with different terminology and confusing acronyms, not to mention differing levels of service and an array of contacts.
- Lack of understanding or knowledge. Because one function doesn’t trust or even know what goes on within another function, certain activities may be needlessly repeated, increasing recruiting costs and time to hire. Other activities may unknowingly contradict with each other. (For example, references may be called more than once, or two business units may make totally different offers to the same candidate).
- Sabotage. It’s not unusual for some sub-functions to actually despise or even “hate” other talent-management functions. Some individuals can try to proactively hurt or sabotage other functions, while others just try to make them look bad (so that their function looks relatively better).
Talent Acquisition Activities That Should Be Coordinated/Integrated
There are many arguments that can be made for including or excluding talent-acquisition activities from the integration process.
The following list represents those activities that, at a bare minimum, should be coordinated (more formal criteria comes later in this article):
• Employer branding
• Workforce planning and forecasting
• Requisition management
• Experienced recruiting
• College recruiting
• Compensation (offer generation)
• Background verification (reference checking)
• Employment marketing
• Internal movement and job-posting programs
• Retention and performance management
What Are the Keys to Integration?
If you are going to coordinate related activities, there are certain impactful things to “encourage” the different functions to work more closely together:
- Joint reporting relationships. When you integrate, all the functions report directly to the same manager. When you coordinate, the reporting lines may be advisory or a dotted-line relationship.
- Cross-training. Individuals are cross-trained to do multiple jobs. In addition, this training allows them to be redeployed for either short- or long-term assignments in other areas of talent acquisition or HR. Webinars and training sessions from every function in the overall process are available to all.
- Shared communications. Shared newsletters, memos, and websites allow every function to know what’s happening in other related functions.
- Cross-functional teams. Requiring inter-related teams to form cross-functional management and problem-solving teams can dramatically improve the workflow. Jointly funded projects can also improve cooperation.
- Build influence skills. A great deal of HR work is now done by individuals who do not report directly to you … so the ability to influence others becomes critical. As a result, team leaders need to be trained in how to influence individuals who can’t be “forced” to cooperate.
- Joint meetings. Periodic joint meetings (in-person and virtual) improve mutual understanding and increase the number of discussions about problems created by “other” sub-functions.
- Inter-departmental rotations. Periodically rotating talent among interdependent departments improves communications, understanding, and cooperation. The rotations can be short-term or permanent.
- Shared rewards. Performance rewards tied to the success of related functions can dramatically increase cooperation. For example, part of one function’s bonus pool is tied to offer acceptance rates so there is an incentive to provide reasonable offers to the recruiting function.
- Common metrics. If all related functions in the hiring process are measured on their contribution to “time to fill,” they are all likely to focus on it and to work together with others to improve the overall metric. An integrated error reporting system would ensure that process errors could be assigned to the appropriate owner of that step in the process. Survey a sample of hiring managers and new hires to get their experience of what process parts were integrated and which ones were disjointed.
- Wiki best-practice sharing. Providing in-house wikis that allow individuals from different functions to help build a shared talent-acquisition knowledge base helps increase ownership in talent acquisition by all. It also leverages the power of the crowd to ensure processes consistent with goals from every perspective. Individuals should be recognized and rewarded for facilitating the sharing of best practices between the different functions.
- Shared forecasting and planning. When related units share forecasts and plans, they are much more likely to see the same upcoming problems and opportunities.
- Shared database. Requiring the different sub-functions to use (and add to) the same database can dramatically improve understanding and information flow. Requiring all sub-functions to shift to databased decision-making can also improve quality and consistency.
Indicators That Disparate Functions Should Be Integrated
Integrating every function can actually be counterproductive, in that you can end up with a large, unwieldy bureaucracy. Instead, you should carefully select, using predetermined criteria, which activities should be closely integrated. There are several criteria that, when present, indicate that related sub-functions should be integrated.
Those criteria include:
- Customer expectations. The first criteria for determining when functions should be integrated is whether the customer or user expects “a continuous process.” For example, when asked, hiring managers universally agreed that the requisition, recruiting, hiring, and onboarding processes should all be integrated. Candidates would also agree that it’s frustrating to be continually “handed off” to a different function throughout the process of becoming an employee. What this means is that whenever the customer expects “a seamless process,” senior managers need to work to provide that integrated process.
- Significant “handoff” errors. When poorly coordinated functions “handoff” a user to the next step or function in the process, there is a markedly increased chance of errors occurring during the transition. If errors are costly, the inter-functional communication must be nearly perfect (like at the handoff point between the recruiter and the compensation offer specialist, where miscommunication can lead to extremely low offers that have no chance of acceptance). Independent functions with different terminologies and unique acronyms can dramatically increase misunderstandings. Formal integration certainly improves communications and makes handoffs smoother because a single manager oversees the inter-related functions.
- Significant inter-dependencies. If the output of any particular sub-function is highly dependent on the quality of the inputs from the function that precedes them in the process, they are dependent. For example, sourcers depend heavily on accurate position descriptions that outline all criteria that will be used to screen candidates.
- The need for simultaneous operations. When related operations are “linear” (meaning that a follow-up step doesn’t begin until the previous step is completed), there is less need for integration. However, when you want to minimize “slack time” and keep your workforce fully occupied, it’s critical that several functions operate simultaneously. For example, when you’re processing the firing of one employee, you can begin sourcing a replacement. Obviously, it’s hard to manage overlapping, simultaneous operations without close coordination.
- The need for speed. In any case where speed is essential for process success, coordination can certainly help to identify roadblocks and unnecessary delays. Wherever speed and responsiveness are important (as they are in hiring), at the very least, a coordinated effort is necessary.
- The need for cost efficiencies. Operating numerous independent sub-functions is simply more expensive because each must have its own manager, metrics, and policies. Overall process costs also increase when two functions unknowingly repeat the same task because of poor communication. If you want administrative cost-savings, eliminate duplication and overlap through integration and coordination.
- Physical separation. If the interdependent functions are physically located away from each other, the distance will cause less-natural interaction. The reduced frequency of interactions among employees means that lower levels of trust and understanding develop among the employees of these separate functions. Obviously, effective coordination and integration can help to prevent any “us vs. them” mentality from developing.
- Shared technology. Whenever two separate functions share the same database or software, integration ensures more consistent data-entry and database maintenance.
The concepts of coordination and integration have a proven track-record. Merely spending a few hours with managers of the supply-chain or customer-service function can get you all the insights and tools that you need. Yet some will fight because of their insecurities or political agendas.
The best way to overcome resistance is to identify the biggest complainers and whiners; keep the ones who put the good of the organization ahead of their own private agendas. After integrating talent management, don’t stop there.
Work with the rest of HR to integrate the three primary areas (buy talent, build talent, and increasing productivity) so that all aspects of talent management and the business act as one.