Global HR Programs Increasingly Aligned with Corp. Strategy

May 26, 2010 ( – A new Ernst & Young study finds that global firms are increasingly pursuing HR issues in a way that helps them execute their business strategy and drive revenue.

The report said strategic HR initiatives are increasingly focused on boosting employee engagement by building in flexibility to address the needs of today’s diverse pool of talent.

More than half (63%) of respondents say their current talent management programs are aligned to the business strategy and continue to be proactively modified to reflect changes in the direction of the company. A separate analysis of the data shows that the group with better alignment had significantly higher financial performance [a 20% higher annual return on equity (ROE) over a five-year period] than those that did not.

“An organization’s commitment to executing its strategy effectively is directly related to its ability to attract, retain and develop talent,” said Bill Leisy, a Principal with Ernst & Young LLP’s Performance & Reward practice and an author of the report, in a news release. “Global organizations must understand the needs and motivations of their people in order to provide opportunities that not only appeal to different generations and cultures, but help the company retain the necessary skills and competencies it will need to emerge stronger down the road.”

Only 32% of respondents say all the components of their talent management programs are integrated on a global, enterprise-wide scale versus 20% who only integrate their programs regionally, 18% by business unit, and 24% who do not integrate their programs at all.

The survey of corporate executives found that the top three talent management initiatives respondents plan to implement include:

  • Building their internal talent pipeline to fill critical future needs (64%);
  • Understanding and coordinating global talent resources to fill key positions (33%); and 
  • Offering flexible work strategies such as job sharing, telecommuting, flex hours, and phased-in retirement (31%).

The one common element shared by all executives polled was the concern over future gaps in talent among both technical (28%) and middle management (26%) positions, Ernst & Young found.

The report, Managing today’s global workforce:  elevating talent management to improve business is based on a survey of more than 340 global CEOs, CFOs, COOs, and Vice Presidents of Human Resources from Fortune 1000 companies around the world.

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