People are critical to a company’s success. That’s why talent management is so important for any organization that wants to succeed. Finding, selecting, developing, and retaining the right employees should be one of the top business concerns for any leader.

Top organizations value their employees and know that people today are much more willing to switch companies and jobs than they used to be. Companies must work harder to continue to meet the needs of their employees, or the employees will find somewhere else to work.

Research consistently finds that organizations with a focus on talent management have employees who are more engaged and more satisfied with their jobs and companies overall. And when you have satisfied, engaged workers, your employees are more productive and your company will perform better.

More than half of North American companies are having trouble attracting critical-skill employees, according to the 2011/2012 Towers Watson North American Talent Management and Rewards Survey. At the same time, companies are being forced to cut costs, and often employee-retention programs are being eliminated or reduced. This can only hurt companies in retaining and attracting talent in the future.

Most organizations aren’t doing enough to engage and motivate their employees—only a quarter of employees across six countries believe that their employers provide strong guidance in terms of goal-setting, managerial feedback, and career development. So if your organization makes its people a priority, you are sure to see business results.

So what can good talent management do for your organization?

The benefits of talent management are many. The following are some reasons to make it an integral part of your company’s operations.

  • Reduced Costs: Cost is important to all organizations, and workforce cost is the largest spending category for most. But talent management can lower recruitment costs. Consider that the costs of having to replace someone with scarce skills is high, and more costs are incurred with new hires during the first 3-6 months because of their lower productivity levels.
  • Better Hiring: When a company knows what it wants, it will recognize it when it sees it. A good system will ensure better candidates and decrease turnover.
  • Better Understanding of Employees: When companies really know their employees, they can take steps to make them happy and engaged.
  • Better Development of Employees: Good workers try their best and seek to improve themselves; they are highly valuable to any business. Companies that have systems for growing their employees are more likely to have happy and engaged employees.

If you still aren’t convinced that talent management is a key success factor for companies, think about this: Companies with more mature talent management capabilities have, on average, 18% higher earnings, 54% greater net profit margins, and greater return on equity and assets than those without mature capabilities, according to findings from the Hackett Group. Why not start making talent management an important part of your company?

Want to learn more about talent management? Follow my blog this month, where I’ll focus on talent management. And let me know if you have any questions about starting or improving your talent management program. You can also reach me via Twitter at @SrExecAdvisor.

Photo Credit: Flickr user  Jerry Bunkers