Organisations in India’s highly competitive labour market are focusing on leadership, diversity and responsive dialogue with employees for high-impact talent management and curb retention. These companies are also more likely to perform well on business and talent outcomes, according to a new research from Bersin by Deloitte, Deloitte Consulting LLP.

The business and talent outcomes typically include improved innovation, productivity, meeting or exceeding financial targets, engagement and retention.

Summarized in a WhatWorks®Brief, the research findings appear in “High-Impact Talent Management: Talent Management Maturity in India.” A separate report, “Talent Management in India: Improve Maturity in Three Steps,” provides a process on how Indian organizations can strengthen their talent management strategy and practices.

The research findings identify the talent practices that organizations with strong business and talent outcomes use most effectively for operating in India and globally as well. Global 2000 organizations in this case are defined as the 454 companies in the Bersin by Deloitte survey population with more than US$750 million in annual revenue.

The research also includes 269 Indian organizations with more than 100 employees. Studies find that 29 percent of all organizations surveyed globally have mature talent strategies and processes in place versus just 21 percent of surveyed organizations in India.

This report defines high-maturity organizations as those having clear talent strategies that align to the business strategy, a visible culture of leadership and learning, a systemic (versus ad-hoc) way of understanding and communicating with talent, and practices that embrace diversity and inclusion.

“Organizations today face substantial challenges in engaging, retaining and leading a global workforce,” said Stacia Sherman Garr, vice president, talent and HR research, Bersin by Deloitte, Deloitte Consulting LLP. “This is particularly true in growth markets such as India. Our research shows that 80 percent of Indian organizations are missing out on the identified substantial, financial, business and talent benefits of creating a clear, more mature talent strategy.”

The research found that many Indian organizations have strong talent acquisition, performance management and formal skills-based learning activities for employees. Although these are important investments, the next steps to consider are building a culture of leadership and more aggressively communicating the organization’s talent strategy.

To reach the highest level of maturity, organizations should also provide a more customized and engaging employee experience that embraces employees’ diverse backgrounds.

See: Hiring Confidence is Strongest in India, Japan, Taiwan, Colombia and Guatemala in Q2 2016

Compared to Global 2000 organizations, our research shows that Indian companies:

Have lower levels of maturity overall. Only 3 percent of Indian organizations are at the lowest level of maturity, but a full 76 percent of them are at the second-lowest level of maturity. This indicates that a majority of Indian organizations have moved past the most basic talent management practices and are increasingly developing clear talent strategies with more sophisticated foundational talent processes such as talent acquisition, performance management and formal learning opportunities.

• Excel at establishing fair performance policies, processes and systems. Overall, Indian organizations report employees have higher perceptions of procedural fairness and their organizations demonstrate higher levels of sophistication with their performance management practices as compared with G2000 organizations.
• Communicate and integrate talent strategies more often. This involves having a clear talent strategy that is communicated throughout the organization and integrated with relevant talent practices.
• Develop more prevalent systemic relationships with talent. Indian organizations typically understand that talent is a strategic asset that requires investment in the relationship to drive enhanced performance. These organizations know their key talent from a quantitative and qualitative perspective and have processes that enable them to respond to that information.
• Maintain less integrated leadership development practices. Indian organizations tend to lack a systemic approach to leader growth that integrates leadership development activities with other talent management activities. For example, there may be little connection between succession- management processes and leadership-development opportunities.
• Implement somewhat more integrated and strategic Diversity and Inclusion (D&I) efforts. Organizations that are able to master these factors are able to see the greatest benefit in their talent and business outcomes. Embedded D&I involve integrating it with other individual-focused talent activities, such as learning and performance management. Strategic D&I encompasses the intentional design of policies and practices that align and reinforce D&I initiatives.

Given these findings, Bersin by Deloitte’s related report, “Talent Management in India: Improve Maturity in Three Steps,” identifies a process leaders should follow to improve talent management maturity. This process calls for organizations at lower levels of maturity to:

• Strengthen core talent management practices, such as performance management. For example, leverage strengths in areas such as performance appraisal processes and goal setting to help improve accountability for employee development overall, and set the stage for a culture of learning.
• Develop and communicate a talent strategy. Ensure that the talent strategy is widely understood and communicated to employees, especially by middle managers.
• Focus on diversity and inclusion throughout all talent practices. For example, expand the investment in diversity and inclusion in the organization; clearly connect this effort to leadership development, succession, learning, performance, and other complementary talent processes.

Also read: Top 25 Best Employers in India You Would Love to Work With