Microsoft Corporation: Talent and Succession Management Report

Introduction

Talent management and succession planning have become core functions of human resource management as organisations struggle to maintain a pool of skilled workforce. It is important to understand that these are two vital human resource functions which involve having the right people to undertake various duties whenever this may be necessary.

According to Berger and Berger (2004, p. 48), “Effective talent-pool management concerns itself with building a series of feeder groups up and down the entire leadership pipeline or progression.” It means having the right workforce who can take up any position within the firm I case it falls vacant. As these scholars note, it involves identifying the skills and talents of the employees within a firm that may make them fit for various positions whenever they fall vacant.

On the other hand, Oakes and Galagan (2011) say that “Succession planning is focused narrowly on identifying specific back-up candidates for given senior management positions” (p.57). Many organisations always struggle to find replacements for their chief executive whenever the current holder of the office leaves the office unexpectedly. In most of the cases, such an organisation would consider looking for the replacement from outside the organisation because there were no plans laid down to groom the internal employees for the top post.

According to the research by Shukla (2009), it is a fact that getting the top management employees internally from the current employees is more beneficial than getting the replacements from external sources. Not only do these employees understand the organisational culture of the organisation, but they also get motivated by such promotions. They develop a feeling that the organisation respects them and holds them in high regard. Such individuals would make an extra effort to ensure that they are successful in order to maintain the trust that the organisation has towards them.

This is very different when the top replacements are taken by employees from other organisations. These newly hired top executive may be too proud to deliver good results, always feeling that the current employees of the organisation are inferior to them and that is why they had to be hired from other organisations. In this study, the researcher will focus on the importance of talent management and succession planning strategy, and how Microsoft Corporation has used this strategy to achieve success in the market.

Importance of Talent and Succession Planning

According to Elegbe (2010), many organisations have experienced problems because of poor or lack of talent management and succession planning strategy. These are very important human resource functions that an organisation should not ignore if it is to achieve meaningful success in its operations. Talent management is a task that involves identifying desirable qualities among the current employees.

It involves identifying what they can do better, and areas where they may need little changes in order to ensure that they can be assigned specific duties. In an organisation, it is a fact that many positions are always left vacant regularly because of issues such as transfers, promotions, resignations, lay-offs, deaths, or any other reason that may make an employee quit his or her current position. A successful firm will not just make haphazard replacements simply because there is a need to fill in the post.

According to Effron and Ort (2010), Microsoft Corporation is one of the largest and most successful computer software and hardware firms. One of the reasons why this firm has been successful is because of its talent management strategy. This firm is always very keen when it comes to managing its pool of talents. Since the days of Bill Gates as the chief executive, Microsoft Corporation has developed a culture of pooling the talents in order to know how to assign its employee’s various tasks.

The human resource unit developed a unit that identifies the special skills and capabilities of the employees from junior positions to senior managerial posts. This strategy helps the human resource to match task needs and employee capabilities. This makes it easy to identify individuals who can be assigned to various posts in case they fall vacant. This eliminates cases where people are promoted based on the time they have spent at the firm without considering their ability to deliver results in these posts.

Succession planning is a very important task that many organisations are yet to take seriously.

According to Israelite (2010), when firms succeed in getting highly talented and capable chief executive officer, many of them tend to forget the fact that this officer may one day leave the organisation, sometimes sooner than expected. For this reason, they spend a lot of time trying to offer the best working environment for such an officer without giving focus to the need to groom replacements. These organisations fail to realise that there are various uncontrollable forces that may make such a good director leave the firm sooner than the agreed date.

When such unavoidable circumstances occur, such organisations would start scrambling for anyone they believe has the right qualification to fill the post. In such cases, ending up with a wrong candidate is a very likely event. Pham-Gia (2009) says that such unfortunate incidents can be easily avoided by having the right succession plan within an organisation. Promoting internal employees to the topmost managerial position has always been considered to be a better alternative than hiring someone who was previously working for a different firm.

This should be a rigorous and continuous process that involves identifying special skills among the existing executives. The relevant officers should be able to single out characteristics, skills, knowledge, and special talents among the executives that may make one better qualified than others to fill the post of chief executive in case the position become vacant. This is the strategy that Microsoft Corporation has been using in order to remain successful. The approach that has been taken in appointing the chief executives of this firm is probably one of the best among the leading multinational corporations.

When Bill Gates left the position of chief executive on January 13, 2000, he identified Steve Ballmer as the best replacement for the position. Steve Ballmer had been working for the company for about twenty years as at that time and had held important managerial positions at the firm. The current chief executive officer, Mr Satya Nadella, joined the firm in 1992 when the company was under the leadership of Bill Gates. He had held various top positions in the firm by the time he became the top executive of the firm.

The link between Learning, Development, Performance Management, Talent Identification, Talent Assessment and Career Development

As Schweyer (2013) says, talent and succession management planning is a complex process that involves a series of activities. These activities are interrelated in one way or the other. They work together in grooming employees to take various sensitive positions within the firm in order to ensure that there are continuity and success even in cases where other employees leave the firm for various reasons. The following are some of the activities that are involved in talent and succession management planning.

Learning

According to Tony (2007), learning is one of the core values in employee development. The world is experiencing various changes brought about by technology and other environmental forces. The only way of mastering these changes is through the learning process. Many organisations have developed programmes that allow their employees to undertake advanced classes in order to enhance their understanding of their fields. However, learning is not only limited to a classroom context of the teacher-student relationship.

The experience offers the best learning process. In most cases, organisations would organise on-job training for their employees in order to offer them a practical training session on how they can handle their tasks in better ways. Continuous learning process results in development. At Microsoft Corporation, there is a program that not only makes it possible for the individual employees to advance their educational qualifications but also compensates them for the costs they meet undertaking such programs. The management has always been flexible when it comes to assigning of duties, especially to those who are undertaking further education.

Development

Employee development is a process of adding desirable values to the workers in order to make them more suitable for their current or future positions. Development involves learning through experience, classwork, teamwork and other such related activities. It also involves gaining skills that will enable one to coordinate with other employees, and to understand how external environmental forces can be managed using internal capacities in order to achieve success.

Through development, an employee is groomed to be in a senior managerial position. He or she is able to develop an understanding of what it takes to lead others and the expectation of all the stakeholders within the firm. During the development process, one is able to understand how the internal and external environmental forces interact, and the best way through which an organisation is expected to behave in order to avoid negative impacts that external changes have on a firm.

Performance management, talent identification, and talent assessment are aspects of employee development. The successive leaderships of Microsoft Corporation have been sensitive to the issue of employee development. The organisation has been keen on taking a holistic employee development approach to ensure that their employees expand their knowledge in their respective areas of work and that they learn interpersonal skills that would facilitate teamwork within the organisation.

Performance Management

According to Armstrong (2007), the overall performance of an organisation largely depends on the performance of the individual employees. This explains why many organisations are currently considering performance contract as the best measure of determining the compensation of their employees. This simply means that the employees would be compensated as per their output. Performance management entails identifying specific objectives that a given office holder should achieve within a specific period.

As Waldrop (2008) says, the objectives set for the employees should be specific, manageable, achievable, and realistic. The evaluation team would then determine how well an employee was able to achieve the set objectives. In case it is determined that the employee was way off from achieving the objectives, a team should be set up to explain why the employee was not able to achieve the set objectives. The obstacles identified on the employee’s path towards achieving success should be addressed adequately before he or she can be assigned new objectives within the firm. At Microsoft, this programme exists.

Employees are assigned duties based on their positions within the firm and their capabilities. After the end of every year, the performance of every employee is always evaluated in order to determine how well they were able to meet the set objectives. Those who surpass their set targets are always rewarded as a way of boosting their morale. Those who fail to achieve the target would be subjected to some form of investigation in order to determine why they were not able to achieve the set targets. The firm has a policy that recommends layoff to those who are consistently unable to meet its objectives.

Talent Identification

According to Sims (2007), talent identification is one of the most important tasks of human resource management. Employees have different skills and talents that make the unique and best suited for different tasks. Many organisations struggle to achieve success because they have not been able to match their employees’ talents with the tasks. However, this can only be done if these talents can be identified. Sometimes the employees themselves may not realise that they have a special talent that can be useful to their employer.

This means that it is necessary for organisations to develop programmes that would help identify these talents. According to Mathis and Jackson (2009), Microsoft has perfected the art of talent identification as it seeks to maintain innovation in the firm. The firm uses regular contest in order to identify special talent among its employees. Such competition would involve developing new software, advancing the current software, or addressing various issues within the organisation in a way that is unique and superior to the approaches that are in use. Through this, the organisation is able to identify special talents that may help it in various areas.

According to Price (2011), talent identification can also be done by the non-management stakeholders. This may be through the feedback received from the clients based on these services they receive from the firm. This information can be used to identify some of the desirable capabilities of some of the employees. Some organisations consider using services of other institutions that have specialised in this area. They would be expected to work closely with the employees as an independent authority to identify their skills and special talents. This information would then be delivered to the management so that a decision can be taken. However, this approach is not being applied at this firm. Microsoft Corporation uses its own management to identify these talents.

Talent Assessment

According to Shukla (2009), once the talent has been identified, the next important phase is to assess it in order to determine its usefulness to the organisation. Talent assessment is a review process that involves identifying the relevance of a given talent to a given organisation. Sometimes it may occur that the talents of a given employee are not relevant to a given organisation. Waldrop (2008) says that a talented chef may be more beneficial to Hilton chain of hotels than to Apple Inc. similarly, a talented software developer may not have a place at the Sheraton Hotels, but may be an invaluable individual to Microsoft Corporation or Apple Inc. when assessing the talent, the focus would be on determining how relevant the special feature on the employee is to the organisation.

Before dismissing a given talent as being irrelevant, it is necessary to evaluate various areas within an organisation that needs different skills. A skilled security officer may not have the knowledge in software development needed at Microsoft, but his skills are very important to this organisation in ensuring the safety and security of people and properties of the firm. Making a rush decision of declaring a given talent irrelevant may be a costly process. It may make an organisation to lose a skill that may be used to advance its operations.

At Microsoft, human resource management has rolled out various programmes that are meant to identify and assess talents of the employees in various fields. The mid managers and supervisors are always given opportunity to identify employees will skills that they feel are needed within their department. They would then be expected to write a letter to the human resource explaining why they feel that these employees have the skills they need in their departments.

The human resource will review such letters and determine the necessity to reassign employees from their current tasks to other tasks in the same department or other departments within the organisation. The aim is to ensure that in the long run, every employee is assigned duties that best meet their capacities as employees of the firm. This strategy not only boosts the results, but also enhances employee morale.

Career Development

Career development is a broad term which involves all the activities that focuses on the advancement of one’s career. According to Price (2011), many people always face serious challenges when developing their careers because of the mistakes they make at the very beginning of their careers. For instance, it is common to find someone with passion in music focusing on the field of medicine because of peer pressure or the pressure from the parents.

At the beginning of their career, they would always struggle to be successful in the wrong careers because they want to please other people. However, as they grow more independent and as the external pressures get eliminated, they are left without the drive to advance their career. They become disillusioned when they realise that they took wrong path that does not offer them the satisfaction they need. This disillusionment may have serious negative impact on one’s career development. This is especially the case when the age factor cannot allow one to make a turnaround to take the career they would love to have.

The research by Waldrop (2008) reveals that passion is one of the key forces in career development. When one has passion in what he or she is doing, then one will always make an effort to ensure that he or she does what it takes to be successful. At Microsoft Corporation, there is a program that seeks to help in career development from very early stages of life. The organisation has developed programme that seeks to identify talented individuals with passion in software engineering.

Through this programme, the selected individuals would be given guidance on the right courses to take at the college level. Once they graduate from colleges, the firm would determine their ability to fill in various posts within the firm. This approach was taken to eliminate cases where some employees quite their important positions in the firm to pursue careers that are very irrelevant to software or hardware engineering. Having employees who are passionate in their assignment is an assurance that they will be retained within the organisation as long as the environment remains favourable to them.

Learning and development are part of career development. As one experiences developments in various areas of his or her work, he or she will be developing his or her career. This will be seen through promotions earned at various stages. The ultimate aim in one’s career development is to become the chief executive officer of a blue chip organisation. This will be the ultimate indication that one has been successful in his career path, and the top most position is not only an indication of this, but also a reward for the relentless effort and skills at work.

Reflective Analysis and Suggested Changes

It is clear from the analysis of the current status above that talent and succession management planning strategy is very important human resource task that may define the future success of a firm. The above analysis has clearly shown how Microsoft Corporation has been struggling to ensure that it lays clear programs that would define its talent and succession management planning strategy.

This firm has been a number of strategies to identify talents and determine their relevance to this firm in order to enhance its success. The firm has also been keen on grooming executives to take top managerial positions in order to ensure continuity at the firm. Of the three chief executives that this firm has had since it was founded, none of them was sourced outside the organisation. The top management would groom a number of candidates for the top position, and when the time comes, one of them would be chosen to head the organisation.

That is how the current top executive, Mr. Satya Nadella, and his predecessor, Mr. Steve Ballmer, were chosen to head this organisation. Although the firm has been successful in this area, it is clear from the analysis that there is a gap in the current system that may inhibit the ability of the firm to be successful. The management of this firm should work on these gaps in order to make the strategy more effective. The following are some of the suggested changes that may need to be observed in order to enhance levels of success.

High Potential Development Program

According to Mathis and Jackson (2009, p. 38), “Developing the current and future leaders requires a deep understanding of how development happens on the job.” These scholars say that many organisations have failed to develop future leaders because of their minimal understanding of how development takes place on the job. The human resource management should have the knowledge of how its workforce can be developed while working in their respective areas of assignments.

On-job development involves developing programs that will help expand the knowledge of the employees not only through experience, but also teamwork and introduction of new concepts. This is an area that Microsoft has not given enough consideration. The best approach of doing this is to outsource the services of external specialists or get the relevant tutors among the current employees. These tutors will work together with the employees whose skills need to be developed. This way, the tutors will introduce the new concepts to the employees in a practical approach.

The employees can ask any relevant question in order to enhance his or her understanding of the new concept. However, Shukla (2009) warns that when using this strategy, the student-learner approach should be avoided as much as possible. Teamwork approach is always the best so that the employees may have the freedom of asking any relevant question on the new concepts that they are learning. This eliminates unnecessary formalities that may affect the ability of the employees to grasp the concepts easily. This is why it is always recommended to use consultancy services other than using senior employees to train junior employees.

Competency Development

Sometimes an organisation may suffer from the problem of employee incompetence. Having an incompetent employee may not necessarily mean that the employee lack the relevant skills to make him or her deliver good results. The problem could be with the competency model that is in use within a given organisation. Armstrong (2007) says, “A thoughtfully developed competency model is one of the best ways to make sure all parts of your people management process are aligned and pulling in the same direction” (p. 49).

The competency model must be able to identify skills and special talents of an employee within an organisation. The model should then identify specific tasks that should be completed using the competencies of the employee. This model must also define how different skills and talents will be brought together when undertaking various tasks within a given department. The focus should be to ensure that in areas of weakness of a given employee, there will be another employee who will be able to support him or her in order to achieve an overall success within a given firm.

At Microsoft Corporation, the human resource has been keen on developing effective competency models in order to ensure that employees in a given team complement each other. Using some of the new models may help this firm to achieve good results. However, care should be taken to ensure that only practical models are used. Some of the models may not achieve the desired results because of practical challenges.

Talent Pipeline Assessment

As a business unit experiences growth, it may be difficult to precisely determine the number of top executives that would be needed in the future. Some firms experience rapid growth that may force them to identify employee to fill in senior managerial positions for effective management of the firm. The problem that many firms face is that they do not realise this until when the roles become too many to be handled by the few top executives.

Pham-Gia (2009) says that talent pipeline assessment “Makes sure that a given business unit has quality people and key talent in the right roles right now, and creates a People Plan for a successful future” (p. 48). This model helps in focusing on both the current and future needs. A successful future depends on what an organisation does today. It means that the current operational activities should be done by a team of highly talented workforce with the right knowledge of what is expected of them. Talent pipeline assessment helps in identifying the right workforce at every stage of a firm’s development.

As the form experiences growth, the nature of employees needed for every task also changes. This program plays an important role in making the employees of the organisation to change with these changes in order to make them relevant for various posts. This approach helps in eliminating the need to hire new employees from other organisation to take over top management positions. The current employees will be groomed at every stage to undertake these duties at higher levels. This strategy can be very beneficial to Microsoft Corporation.

Action Learning

Action learning is increasingly gaining relevance in many organisations across the world. The current competitive environment has forced many organisations to look for ways of increasing the knowledge of their employees while they are working. This gives employees the practical knowledge on how to address different tasks. According to Dessler (2005, p. 28), “Action Learning is a highly effective way for senior management to provide mentoring and visibility as part of a structured development program that drives the company’s goals forward.”

Action leaning, also known as project based development, offers employees an opportunity to develop new knowledge and skills working on critical projects with high potential employees. In this strategy, the high-potential employees will guide the junior employees on what they are expected to do at various stages. This approach is beneficial to both the management unit and the junior employees of an organisation. While the junior employees will be learning about new skills that can be used to undertake various tasks, the management will be offered an opportunity to understand the potential of the employees. This makes the process of assigning them various tasks very easy. Microsoft Corporation can use the approach to expand the performance of its employees.

Strategic Talent Review

As the company expands, it may be necessary to conduct regular reviews to determine if the employees have been rightfully assigned various tasks. Price (2011) defines strategic talent review “As an efficient and systematic way to check the quality and alignment of talents to determine whether a company has the right people in the right roles” (p. 57). There are cases where growth of firm is inhibited by the fact that employees are assigned positions that do not correspond with their skills and experience.

When this happens, even the most effective employees will underperform because they will be forced to work in areas that they have minimal knowledge. Strategic talent review allows the management to conduct a regular appraisal on the employees to determine how well they are able to use their knowledge and skills to achieve success in their tasks. The assessment team should be keen on identifying the mismatch between the talents and task requirements. When such incidents are identified, corrective measures should be taken immediately. Microsoft Corporation can use this strategy to enhance alignment of its employees’ skills and talents, and the assignments that is given to them in order to achieve the desired success.

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