Emerging Trends for the “New Normal” of Retention & Succession Management in 2021Jan 26, 2021
Author: Mike Tarbell
Many leaders are striving to anticipate what the “new normal” will look like in 2021. We are seeing some emerging trends and predict that the health and safety, political, racial, environmental, and economic dynamics of 2020 will lead to some talent, retention, and succession issues that leaders must plan for in 2021 and beyond. COVID-19 has accelerated the need for a renewed focus on talent retention and succession, as turnover will most certainly increase in the year ahead. Top talent will be making their next career decisions with a new set of considerations in mind.
The Talent Challenge
With the onset of the pandemic, people tended to “stay put” and were less open to changing jobs as layoffs became a reality and job security a priority. This led to pent-up demand in the job market. In addition, as the shift to virtual work became the accepted norm, the potential to work from anywhere (i.e., closer to family, in more desirable locations, etc.) is now more than an aspiration.
Older employees have taken time in 2020 to step back and contemplate their futures and make post-retirement plans. Some have chosen to leave the workforce earlier than originally planned, and some have simply “had it” and decided to accelerate their retirement transitions. Layoffs, early retirement programs, and the potential for a post-COVID-19 economic surge in retirement asset values may also incent early retirement. Efforts by companies to address employees with out-of-date skills (i.e. those who are “hanging on too long”) will drive more employee movement and exits.
As many in their 50s and 60s leave the workforce, there will be a premium for talented, diverse leaders (i.e., in their 30s and 40s) who have the unique ability to lead larger, more complex organizations in the future. These leaders lack the experience of their older counterparts and will require accelerated leadership development, career and succession planning and mentorship from transitioning leadership. As people support their local communities, small to medium-sized businesses—who offer more agile, entrepreneurial cultures—will become more desirable. Executive roles will shift in focus and require greater skills in digital, social media, diversity, talent management, change leadership, communications, and so forth.
Greater awareness of racial and gender injustices with the Black Lives Matter and #MeToo movements make talented women and people of color even more coveted by companies that desire to play catch up and diversify their workforce and re-define their cultures. Pay-equity issues become more acute, and organizations will use compensation as a short-term retentive strategy for their top talent.
The Talent Opportunity
Given these challenges and the retention issues that we foresee in 2021, organizations that are more agile, responsive, and adept at talent management will need a new set of leadership imperatives. Their talent strategy must incorporate a set of critical priorities:
- Assess, know, engage, and retain top talent.
- Invest in and accelerate the development of emerging and future leaders.
- Proactively identify, source, and court capable, diverse, external talent to fill gaps in succession.
- Increase focus and succession planning precision—with internal and external options.
- Make diversity, equity, inclusion, and advocacy a focus of the team and culture strategy—a competitive advantage.
- Become great at managerial excellence and, specifically, setting clear goals, coaching, and having courageous feedback conversations.
- Make culture building, change agility, social/digital communication and other key emerging skills a core competency for top leadership.
In addition, top leaders need to become more capable at having transparent conversations with their key, emerging talent (without fostering entitlement or disenfranchising expert, limited-potential talent that they want to retain).
Because these dynamics will have a profound effect on organizations in 2021 and beyond, companies must double down on their talent management, succession, and diversity work. We must be mindful that the priorities we choose and people we appoint to fill key leadership roles will send a message about what’s important, how much we truly value diversity, and the brand of leadership we want to model. As we make choices, we must do so with intention, because our leadership appointments will inform who stays, who leaves, and the kind of leadership culture that we want to reinforce.
Uncertainty is certainly a constant. The ability of leaders to be agile and proactively respond to these trends while sharpening focus will determine who can successfully navigate through the talent challenges and opportunities ahead.
Playbooks Consulting, is a boutique consulting firm located in Portland, Oregon, USA. They work with growth companies to advance their talent management capabilities—specializing in developing capable leaders, building high-performing teams, and succession and career management.