Do you know your STAR TVC (Talent Value Cell)?

Hint: It is not your ‘Hi-POs!’

The impact of individual Talent Value Cells (TVC) on your company’s growth and profit is very powerful. It is easy to uncover this impact.

In the previous post, I had written about how to identify a TVC*.

I had also written about assessing how the following parameters move over a three-year period for each TVC.

The table below is focused on six core scenarios. Understanding these scenarios will help you deal with other scenarios and outcomes.

This is how you start making sense of the data.

1.  Start with the last column. If a particular TVC’s total profit as a % of the company’s profit has gone up, this TVC merits your attention.

2.  If the profit per employee has also gone up, this TVC may be your star.

3.  If the Revenue per employee has also gone up, confirm this TVC as a ‘STAR TVC™.’

As TVCs are nothing more than numbers surrounding a particular talent group, your HR strategy related to your STAR talent group must differ from other talent groups. How do you do this? We will approach this in future newsletters.

For now, it is important to note that the STAR talent group is not your traditional set of ‘Hi-Pos.’

The talent group emerging out of the STAR TVC™ is a group of people who have created more commercial value than other groups. This group is a specific business section or a team of the company. The criterion for a STAR TVC is demonstrated, quantitative performance. It is not judgmental ‘potential’ determined by few individuals, in a conference room, for other people sprinkled across the company.

Let us now come back to another scenario:

1.  A TVC’s total profit as a % the company’s profit has fallen. This is a sign of concern.

2.  If the profit per employee has also fallen, this TVC may be a ‘Concern TVC.’

3.  If the revenue per employee has also fallen, then this TVC is a ‘Concern TVC.’

4.  If points 1,2 and 3 are true AND the cost per employee has gone up, this is a ‘HIGH CONCERN TVC™.’

Again, your HR strategy will differ for different TVCs. The nature of that difference should also be data-driven and commercially focused. Once your HR strategy becomes segmented and directed to individual talent value cells, it will release considerable value for the enterprise.

To start the process of a segmented HR strategy, we need to peel one more layer of data for each TVC.

As you can see in the diagram, the next layer of analysis is to understand:

Drivers that impact cost per employee in a TVC. The big ones are:

o   Company’s market positioning of salaries

o   Impact of inflation on real income of employees.

Drivers that impact revenue per employee. The big ones are:

o   The pricing of the business unit’s product or service

o   Productivity of talent in the TVC.

In the next newsletter, we will link these drivers to HR strategy.

Before I close, please let me know how we are progressing.

Too fast? Too slow? do we need to expand on any subject so far?

I would love to hear from you.

*Again, I am happy to connect with you if you would like to discuss this aspect of Talent Economics.