Practice Management

Finding talent key to moving forward

In November 2008, then White House Chief of Staff Rahm Emanuel gave his personal mantra the presidential stamp…

In November 2008, then White House Chief of Staff Rahm Emanuel gave his personal mantra the presidential stamp as he told a conference of business leaders organized by The Wall Street Journal: “You never want a serious crisis to go to waste.”

Four years later, and as I look back on the events of 2012, I think that adage best captures the most significant personnel trends of the past 12 months.

Topics such as succession planning, talent assessment and long-term compensation dominated our industry conferences and discussions among managing partners. High-performing teams have been taking a hard look at their talent, taking action and beginning to build the staffing infrastructures required to propel them into 2013 and beyond.

The recent emphasis on succession planning is an acknowledgement of an increasing population of mid- to late-career founders who are looking at the next generation of leaders to step up and take the reins.

Executive teams are realizing that the process of designing, implementing and executing an effective succession plan requires a multiphased approach and an acceptance of the idea that what got you here may not be what is going to get you where you want to go.

Whether it is compensation, performance management, talent acquisition or team development, the highest-performing firms of the new year will be those that can quickly identify their most critical needs and immediately begin executing elements of their plan.

Another popular trend of the past 12 months was the acknowledgement that a unique talent and a specific set of skills is needed to be effective at building business by nurturing existing client relationships.

EMERGING TREND

It takes something else entirely to be consistently successful in prospecting and closing business from new clients. Talent assessment is an emerging trend among high-performing firms that desire to build their business through the development of new relationships.

This approach requires objectivity when evaluating existing talent and certainty when designing the compensation and development infrastructure required to attract and motivate new rainmakers.

Looking directly for the skill sets required to execute your growth strategy, building profiles of the “right” talent and committing to a culture of regular talent assessment and continuous improvement are the pillars of sustained success in this area.

Compensation is a perpetual hot topic in our industry. It is the increasing emphasis on long-term incentives that differentiates 2012 from prior years.

Hand in glove with the succession plan is the multiyear cash or equity opportunity that facilitates a path to increased ownership for the next generation of leaders. More and more firms are taking the time to look at their long-term reward structures and performing the work required to align them with the needs of the plan participants, as well as the strategy of the business.

Leaders are realizing that the single decision to select cash or units as a long-term compensation vehicle rather than real equity when designing your plan can completely change the level of risk to the firm while preserving the perception of value by plan participants. The flexibility offered within today's long-term compensation plans is significant and should continue to increase in 2013.

STRATEGIC PLANNING

Each of these trends points to a similar idea: A comprehensive approach to talent management will be the key factor in successfully executing the strategies of the new year.

Strategic-planning conversations more consistently must include these talent-specific topics, as firms continue to find ways to differentiate themselves within increasingly saturated markets. Human resources professionals will continue to validate their place in strategic conversations.

Their success and that of the firm, however, will be based on how effectively strategy can be moved to execution.

This year should prove to be a continued climb out of crisis and an exciting year of identifying top talent and maximizing the effectiveness of our teams.

Scott Feraro is founder and managing director of Pepin Consulting, a talent services provider focused on the financial management industry. This column originally appeared in the Advisers' Consultant, a monthly practice management newsletter published by InvestmentNews.