In a knowledge economy, the generation and exploitation of knowledge is the predominant source of wealth creation. Hence, currently a lot of the billionaires are from the knowledge-based industries. Information is the raw material for a knowledge-based economy. Services, a superset of the knowledge economy, are a key source of employment for the people, and they soar high as an employment benefactor. The new knowledge based economy rests on the pillars of skill, talent, and education. I think no leader can be successful without these, be it leading an army or driving the business in an emerging market. Hence it is very important for a manager to understand how to manage talent.
According to economist.com, procuring the right talent is the challenge for 97 percent of recruiters. Though the average quality of candidates has declined by 10 percent since 2004, average time taken to fill a vacancy has increased. Hence, many companies are forced to hire below average candidates in order to fill the vacancies quickly. To tackle this problem, certain companies have come up with innovative ideas to attract talent - like writing technology based articles in newspapers thereby creating propaganda to 'sell' their company in the job market. Some others cash in on the achievements of the 'stars' in their work force by highlighting their accomplishments. However, the problems in the company do not end by acquiring the best talents alone.
For example, Enron recruited the brightest of MBA graduates from the best institutions and LTCM, a financial company had 1997 economics Nobel Prize laureates Myron Scholes and Robert C Merton on its board of directors. Both these companies do not exist any more, though they had the best talents in their service. Hence, all the companies need to understand what the daunting work force issues are and what talent is needed to combat the same. They need to reflect on whether they need academic super stars that have attitude hang-ups for their organizations or they need brains that are agile and are more receptive to constant learning. In addition, they need to create an environment for empowerment and independency in their work culture.
Today, people want to do what they like and they do not want to give up that at any cost. "I aspire to create an enterprise where at least 80 percent of everybody’s job consists of doing what they love," says Dick Vague, Chairman and CEO, First USA. Hence, that passion comes from people when they like to do what they want to do, and empowerment is the key to take the company to new heights. A store manager in Home Depot says, "This is my $50 million business. I can double it, or I can run it into the ground. Where else could I get that kind of independence and that much of a challenge at the age of 33?" Hence empowerment and independence is the key in today’s business.