A robust talent pipeline is no longer a nice to have; it's a business imperative. Your future requires strong leaders — the best of which may come from within your current ranks. 

Author: David Alexander


Your employees are the lifeblood of your business — now and in the future — and they are leaving you. Certainly not all at once, but few organizations have gone unscathed by the Great Resignation — the historic numbers of U.S. workers voluntarily leaving their jobs in recent months.

Industry observers see no sign of any real slowdown. In February 2022, nearly 4.4 million quit their jobs, according to the U.S. Department of Labor, nearly matching the 4.5 million record-high number set in November 2021.1 In the absence of an integrated talent management plan that focuses on the employee experience across all aspects of the talent management lifecycle, your organization risks losing good leaders and ultimately, your competitive advantage.

Drivers of employee engagement and retention

We approach employee engagement and retention as a three-legged stool, balanced on rewards, the work environment and opportunities to learn and grow:

  1. Rewards encompass both compensation and recognition. Employees must feel they are fairly and competitively compensated, recognized and rewarded for their work and achievements.
  2. Work environment equates to culture. Workplace cultures vary significantly; but the common thread supports an employee belief that they work for an organization and a manager that respects them and cares about their best interests.
  3. Learning focuses on employees feeling confident they are developing skills and experience. Employees want to see that the organization is investing in their development and that they can see an enhanced future role for themselves within the organization.

Maintaining a balance of all three dimensions is essential. Deficiency in one area will negatively impact engagement and retention even if the other two dimensions are strong. Think of a stool with one leg shorter than the other two. While one might balance on that stool for a short time, stability soon becomes untenable. Organizations sometimes over-invest in one area to compensate for deficiencies in another. In our experience, such unbalanced investment may keep people temporarily. However, the outcome will not drive long-term results and may not be sustainable.

The importance of learning opportunities as a business strategy

Many organizations avoid investing in employee development if there is no ready role for them to step into. "If I train them, they'll just take what they learned and go elsewhere," is an often-voiced concern of employers.

While we can't promise that employees who receive further training will never leave, this concern is where the balanced stool comes into play. Assuming your organization rewards and recognizes people appropriately, employees won't casually leave because you've provided them with skills attractive in the job market — especially if you help them see a future role within your organization.

Challenges to organizational leadership development

Organizations cannot "grow" a programmer or engineer overnight. Developing such skills takes years of experience, education and career growth. Building a continuous talent pool is a long-term strategy and a worthy endeavor in view of the ongoing talent shortage.

The following are five core challenges associated with organizational leadership development. Keep these challenges front of mind as you plan a talent strategy and consider the best use of available resources.

Challenge 1: Employee engagement and retention

As noted, developing talent from within your existing employee pool requires that employees be sufficiently engaged to stay with the organization and see a future for themselves.

Engaging employees is not a new challenge. Employers have grappled with this challenge for about 25 years; indeed a large HR technology sector focuses solely on employee engagement. Likewise, volumes of research address what drives employee engagement and retention, accompanied by lists of employer tactics.

Some employers invest multiple resources targeting all visible challenges, hoping just one solution will stick. However, this scattered approach means that employers may be unable to identify the cause behind any improvement to effectively integrate the tactic into an ongoing strategy. Instead, a targeted and strategic approach encompassing rewards, culture and learning is essential for long-term success.

Challenge 2: Differentiated talent strategy

Few organizations enjoy unlimited resources to invest in their employees, so it is critical to invest more in high performers and those with aspiration and potential who can advance organizational goals. Determining who those employees are, however, is not an easy task.

Decisions about the use of development resources may focus on functions rather than individuals, creating a more objective approach to resource allocation. Data analytics — such as turnover by department, revenue associated with departments or positions, or even perceptions of leaders by department — may help determine critical functions for organizational wellbeing and success. However, thoughtful input by senior leaders is required to pursue a differentiated talent strategy. This approach calls for making decisions around the disproportionate use of investment resources, development opportunities and rewards.

Challenge 3: Integrated talent management

A strong leadership development plan requires an integrated approach to talent management. Integrated talent management leverages all aspects of the HR function as an interconnected whole, from recruitment, onboarding, learning and development to performance, recognition and reward.

An integrated approach ties talent management processes to the organization's people strategy and links the people strategy to the corporate strategy. Intentional and purposeful senior leadership support is critical to the success of integrated talent management.

Such a strategy facilitates the attraction and selection of more successful hires, better-defined career paths and the alignment of the hiring and leadership development strategy. This people strategy then dovetails with organizational goals and efforts to identify existing talent in your organization ripe for development.

Challenge 4: "Gig mentality" workforce

It's been our experience that, compared with previous years, today's employees generally demonstrate less loyalty to a given industry or employer and more to their individual careers, lifestyle preferences and financial situation. The rise of the gig economy has shaped employees' perceptions of employment. Individuals of all generations are more likely to approach employment as blocks of work. This approach may find an individual doing one job for a while and then moving on to another job with a different employer, rather than focusing on growth within the current organization.

These employees value opportunity, flexibility and convenience associated with, the ability to rotate jobs, take on new assignments or extend personal time off. Such offerings will impact the full spectrum of HR functions, making integrated talent management (see Challenge 3) a must-have for effective leadership development. Adjust your talent management policies to work with this trend, not against it.

Challenge 5: A best-fit approach to learning

A one-size-fits-all approach to learning and development is more likely to fail than a tailored approach. People learn differently, including via classroom, online, video, gamification, mentoring, micro-learning, experiential and virtual reality, to name a few. Employers must consider which employees or functions warrant the most significant investment (see Challenge 2), and develop a learning strategy to achieve talent goals.

Like other HR activities, learning should be an integrated function — designed to close skill gaps, support performance, and increase career and organizational wellbeing. Consider supporting policies and practices, such as time-off and pay for learning. A learning strategy should also evaluate effectiveness on engagement and retention and, ultimately, leadership development.

Leadership development strategy and solutions

A strong leadership development strategy calls for a multi-point plan based on a clear understanding of the connection between talent and business operations and the problems the organization seeks to address. The relationship between your employees and your business is core to the organization's value proposition and differs by organization. Business strategists Michael Treacy and Fred Wiersema, authors of the bestselling book The Discipline of Market Leaders,2 assert that organizational market leaders must master one of three value disciplines: 1) highest quality products, 2) lowest prices, or 3) best customer experiences.

Organizations invest in talent differently to provide the best customer experience (high-touch skills) versus the highest quality product (innovation, expertise) or the lowest price (efficiency, productivity). We suggest adding a fourth value discipline to Treacy's and Wiersema's list — the ability to attract, retain and develop talent. Once you clearly define the organization's value proposition (discipline) and the associated employee skills, you can begin creating a roadmap for investing in your employees to support the organization's strategic goals.

Connect with Gallagher to assist your organization with talent strategy, including leadership development, attraction and retention efforts. Our highly skilled Executive Search and Leadership Advisors teams can help your organization devise a strategic action plan to address the talent challenges impeding organizational growth and career wellbeing.

Gallagher also offers a suite of related products to attract, engage, develop and reward your organization's talent.

Contact us to connect with an expert.
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Author Information


1 United States Bureau of Labor Statistics. "Job Openings and Labor Turnover – February 2022," Job Openings and Labor Turnover Summary, April 2022.

2 Treacy, M., and Fred Wiersema. The Discipline of Market Leaders: Choose Your Customers, Narrow Your Focus, Dominate Your Market. Addison-Wesley, 1997.


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This material was created to provide accurate and reliable information on the subjects covered but should not be regarded as a complete analysis of these subjects. It is not intended to provide specific legal, tax or other professional advice. The services of an appropriate professional should be sought regarding your individual situation.