Optimizing Talent Supply Chains: Stop the Leakage

April 23, 2019

Takeaways

Leakage refers to any systemic event or activity that significantly reduces the final product in a supply chain.
As we seek to optimize talent supply chains, it is critical to communicate the forecasted demand to all partners.

Increasingly human resource professionals are applying supply chain theory to the growing misalignment of talent available to meet 21st century workforce needs. There are a number of drivers at the root cause of this trend, one notable driver being the technological evolution that has dramatically changed the skillset required for workforce demand.

To meet growing demand, organizations must take a strategic approach to increase both the quality and quantity of talent supply. The U.S. Chamber Foundation is providing employers and key stakeholders with the thought leadership, tools, and resources to improve the talent acquisition process—their Talent Pipeline Management (TPM) initiative provides a strong foundation and step-by-step orientation for companies adopting this approach. 

What is leakage?

As with any supply chain, partnership is crucial. One of the largest challenges in developing a successful supply chain is “leakage.” Leakage refers to any systemic event or activity that significantly reduces the final product available in a supply chain.

Now, before we provide an analogy that compares a talent supply chain to a supply chain in the manufacturing industry, we have to acknowledge that a talent supply chain approach is a way of thinking so the comparison isn't quite literal. The Chamber Foundation says it well when they say that it "is an orientation toward education and workforce partnerships in which employers are much more than advisors or beneficiaries. Instead, they are end-customers of talent supply chains. This does not mean employers are the only customers that matter, nor does it mean schools are factories or learners are widgets. What TPM provides is a systematic framework for how employers can engage effectively in producing information, facilitating partnerships, managing performance, and improving outcomes in career pathways."

So as we compare manufacturing firms leakage issues such as spoilage, theft, and poor quality—each of these concerns reducing throughput and increasing the overall cost to the organization—we want to be thoughtful when considering the analogous examples for talent supply chains. Where is talent falling out of the pipeline, increasing costs, and diminishing throughput? 

Let’s explore the concept of leakage and the challenges it presents to employers in the context of cybersecurity opportunities in the D.C. Metropolitan area. 

Globally, it is estimated that by the year 2021 there will be more than 3.5 million unfilled jobs with sizeable demand expected due to a growing focus on cybersecurity by the federal government and the private sector alike. To keep the analysis simple, let’s define a representative set of suppliers that includes the University of Maryland’s (UMD’s) computer science program and the local high schools in the surrounding area.  

The employer’s goal is to increase the quality and quantity of talent produced by this simulated talent supply chain—to get more students through this network that have the skills required to fill available and forecasted cybersecurity positions. 

To reach this goal, employers must ensure that UMD can meet forecasted demand and that the “raw material” provided to them by the K–12 partners meets quality expectations or stated differently, that the value created by the K–12 providers is sufficient for the entry criteria for UMD’s computer science program. 

There should be clarity about the amount of output the K–12 system must produce to ensure adequate input into UMD’s computer science program. This target for the K–12 partner should be established based on empirical data on UMD’s ability to cultivate the talent though the computer science program.  

How many students matriculate and complete the program? Let’s assume 65%. How many students transfer to other majors? Let’s assume 25%. By establishing thresholds based on these statistics you can now manage the suppliers to a baseline performance expectation incorporating expected leakage. 

If we look at manufacturing supply chains, the level of integration and the sharing of data between partners is completely integrated from the very first step in the process to the very end. Each partner in the chain knows where the inventory is at each stage of development and can identify variances to expectations. Results are not happenstance but predictable with indicators that provide an ongoing mechanism to assess the overall performance of the system at any point in time. 

This level of integration is the goal of talent supply chain initiatives like TPM. As we seek to optimize talent supply chains, it is critical to communicate the forecasted demand to all partners in the chain and gain their buy-in on their ability to deliver the requested results. When these expectations are not met you know you have leakage in the system and you must collaborate with your partners to identify how to plug the holes to maximize success for all involved.