Talent management vs acquisition: what's the difference?

With employee turnover at high levels because of the Great Resignation, organizations are having to refocus on both talent acquisition and talent management. But while recruitment remains essential, a long-term talent management strategy is the key to success

Some have called it the Great Resignation – the period, at the tail end of the Covid-19 pandemic, when numbers of people quitting their jobs in the US rose to record levels. Others, like Josh Bersin, prefer to call it the Great Migration, noting that people haven’t been quitting the labor market altogether, just moving to what they hope are better jobs in pastures new.

Yet however you characterize the phenomenon, it’s been a period of continuing disruption for HR leaders who were bruised by the demands of Covid-19 – and now struggle to keep hold of staff.

If you’re an organization who has been affected by higher rates of employee turnover into 2022, it’s worth taking stock. At least some (but by no means all) of the higher resignation levels appear to have been from people who were unable to resign during the pandemic, causing latent demand for a move.

But in a people-focused service organization, higher rates of turnover are still disruptive, and they leave you facing a two-pronged problem. First, how do you acquire the right people in a competitive market? Second, how do you manage talent effectively to keep turnover rates down?

Talent acquisition: finding the right people for the right roles

Of course, no organization can succeed without recruiting talented people. The process of talent acquisition is about finding those people – and fitting them into the right roles to help meet business goals.

Different people-based organizations, of course, face different recruitment challenges – so what does talent acquisition mean for you? As a professional services firm, for example, you might be competing in the graduate labor market against other law firms, accountants and consultancies of your own size. In the public sector, you might be looking to attract senior leadership who have the technology skills to drive digital public services. How do you ensure you are following the right talent acquisition strategy?

The answer depends on the kind of organization you want to be. What skills will you need in now and in the near-term future? How will the diversity of the organization have changed by then? What might have changed about your pay structure? And what will matter more to you – technical skills, soft skills, or the ability to translate between the two?

By using technology to map the capabilities you have and compare them to the capabilities you need, you can start planning your journey from the “organization of today” to the “organization of the future”. This will help improve your recruitment success, because it will mean you are focusing your advertising on the skills you really want.

Budget, too, is another factor – because talent acquisition always comes at a price. Yet although it’s a competitive market out there, there’s good news for employers. According to the UK’s Chartered Institute of Personnel and Development, the “cost per hire” has fallen in 2021.

This may be because of the efficiency of digital recruitment or remote hiring practices – yet of course, if employee turnover is high, overall cost will still rise with the number of recruits. For people-focused service organizations, the challenge is to continue to streamline recruitment operations using technology, while maintaining the quality of hires. 

Talent management: a people-focused approach

Unlike talent acquisition, talent management is about far more than just bringing in the right candidates from the recruitment pool. It’s about getting the most from your people (and for your people) in the longer term – not only when they join your business, but as they develop their skills, are promoted, and move through their careers. This means taking a higher-level view of the skills, capabilities and attributes you require, depending on your business objectives.

As ever, there’s a balance to strike, because when it comes to talent management, different organizations have different philosophies. Some organizations may accept a higher rate of employee turnover than others, reasoning that there is no such thing as a “job for life” and that talented people are likely to hop from employer to employer to get ahead. More people-focused organizations, though, may prefer to invest more in recruitment and training in the hope that employees will stay longer and feel invested in the organizational culture over time.

But no matter what the strategy is, the key to talent management is in recognizing that the employer–employee relationship is a two-way street. As employers, we need to be able to understand the skills and capabilities of our employees; but we also need a clear sense of employee’s expectations of us.

That could include broad measures of employee engagement, or an understanding of what really matters to the people who work for us – including hot topics such as the ability to work remotely, to climb the career ladder without being overlooked, or (as cited in a recent IBM survey) the ethics and values of the employer. It might ultimately mean having a plan for making your organization somewhere that people are proud to work.

That’s a lot to manage. So, when you know what you want to achieve from talent management, it’s key to take a structured approach. This means engaging your employees and surveying their needs to understand their needs – while at the same time using technology to improve learning, performance and recruitment.

It could mean taking a real-time snapshot of employee sentiment, so you can get a feel for the mood even when more people are working from home. It may mean understanding how much you are willing to pay to keep the right people in the right roles.

And when people do want to leave your organization, as they always will, good talent management can be about managing that effectively too – because you never know when someone might want to come back. After that, of course, there’s the matter of recruitment to replace and train the person you’ve lost – and the talent management cycle begins again.

Talent management vs acquisition

So, which is more important to your organization: talent management or acquisition? The answer, of course, is that while talent acquisition and management are essential, they are not mutually exclusive – because acquisition is part of talent management as a whole.

So, when considering your priorities, it’s a good idea to focus on higher-level talent management first. Start with understanding where you want your organization to be in the future, your plan for getting there, and the metrics you’ll need to track. Recruitment will be an inevitable part of that.

Meanwhile, how do you make talent acquisition management work for you? To develop your structured approach, technology can help. Human capital management software, for example, can help you to track employee engagement and sentiment – to help improve the experience for your people as they move through your organization.

And because there is no “one size fits all” when it comes to talent management, it’s also important to use flexible technologies – so you can collect and track the metrics that enable you to put the right strategy into place.

So, it pays to have a talent management solution that works at the speed of your strategy – using no-code libraries and low-code microservices to find ways to present the data you need. That way, you can inform better talent management decisions – for the good of your people.