Duke Energy made changes to the company’s senior leadership team; PSEG made several promotions and executive moves; Public Service Electric and Gas promoted three executives; and others ...
Closing the Talent Gap
Ad hoc approaches will fall short when the workforce crisis strikes.
might strain the current workforce.
The value generated from a workforce-gap analysis is directly related to the degree of flexibility available in segmenting the data. The more granular the analysis, the better-positioned a company will be to use the output to generate tangible, well-focused efforts. After all, the effort to retain and source talent will be different in a business function with significant losses to attrition than in one that has been plagued by a high degree of transfer to other functions. The flexibility to conduct “what-if” simulation analyses by altering assumptions to the gap drivers is also useful for understanding the implications of best and worst-case scenarios.
Recruitment Business Case
Armed with a data-driven approach to predicting critical gap areas in coming years, utilities can develop sourcing strategies aimed at filling those gaps. Talent can be sourced through various channels, both internally, through retention and promotions, and externally, through experienced and new hires. Circumstances in some geographies or functional areas may make one channel more feasible than another, but most strategies will require a comprehensive approach that uses all channels.
The first decision is to determine the emphasis that different channels will have in the sourcing strategy. Is a utility going to bring new “inexperienced” hires into the workforce, or will it rely on the industry and contractors to fill the gaps? Does the utility have a good set of initiatives to reduce attrition?
An analysis of the external labor market can generate insight into which sourcing strategies are possible given the availability of talent. Such an analysis can be conducted on a local, regional or national level, depending on the job function in consideration. The goal is to identify the size of the potential talent market based on relevant skill sets and experience, and to draft a strategy that not only meets operational needs, but also acknowledges the realities of the available talent pool. In addition, companies should consider ways to expand the pool by tapping alternative skill areas.
Timing also might direct sourcing decisions, as experienced hires likely will be necessary to fill gaps in the near-term, while developing a steady pipeline of inexperienced hires will help mitigate longer-term talent shortages.
Finally, building the business case behind various sourcing strategies requires identifying and quantifying the benefits and costs associated with each strategy. Would bringing in new inexperienced hires be more beneficial than relying on industry hires? Using the business-case figures can help executives compare different sourcing strategies and execute the initiatives they propose.
The alternative to this active risk-management approach is to maintain the status quo and react to talent shortages as they happen, resulting in increased costs for emergency hires, additional contractors, or increased overtime for current employees.
Active Workforce Management
In addition to directing talent-sourcing strategies, a robust gap analysis can help in drafting other workforce management initiatives. The most successful initiatives are customized for particular segments of the employee base and aimed at curbing talent losses from a particular cause. In the nuclear industry, for example, competition for specialized resources is increasing sharply from neighboring utilities,