Why is there such a big difference between those figures? "I think business leaders don't know how to start. They don't even know where to begin," says Stacey Epstein, senior director of marketing with SuccessFactors (www.successfactors.com), a provider of performance and talent management solutions that conducted the survey in cooperation with the Business Performance Management Forum (www.bpmforum.org) and the Human Capital Institute (www.humancapitalinstitute.org). Often, "HR is so bogged down with administrative tasks that [there isn't] time to be that strategic."

Talent Gap Is Growing

"Talent management is a strategy for setting and aligning goals throughout an organization," says Epstein. "It's a strategy for making sure the right people are in the right jobs,...for measuring and managing employee performance,...for rewarding and compensating employees based on performance,...for ensuring adequate bench strength and talent across the organization."

SuccessFactors' "2007 Performance and Talent Management Trend Survey" demonstrates why effective talent management is so important. Ninety-eight percent of surveyed companies are experiencing increased competition for talent, and the competition is increasing to a "high" or "very high" degree in 65 percent of those companies.

In addition, economic issues, business growth, and changing workforce demographics are creating the need for new critical competencies in 88 percent of participating organizations--with nearly half of respondents indicating that critical competencies are changing to a "high" or "very high" degree, according to SuccessFactors.  

 "The talent gap is growing for companies across America and around the world, making human capital management and development more strategic to businesses than ever before," says Lars Dalgaard, CEO of SuccessFactors. 

"Our research indicates that companies that are embracing this need are reaping huge competitive advantages and better financial results," he says.

Such companies experience tangible benefits, such as cost savings resulting from hiring internally and reduced turnover, as well as intangible benefits, such as maximum productivity from employees, Epstein explains.

HR Should Seize Opportunity

Talent management presents an opportunity for HR professionals to position themselves as a strategic resource within an organization. 

"Our survey clearly shows there's a little bit of a crisis going on as it relates to talent, and a lot of companies don't really know how to respond to that crisis," she says. "HR really should grab that opportunity."

Epstein recommends that HR professionals "really get to know" their employee base. "Understand their skills and competencies," she says. 

"Make sure your employees understand what the goals of the organization are and are working on tasks that will further those goals?. Reward employees for the work they're doing. Don't just pay people bonuses across the board," she emphasizes.

Although organizations don't have to use technology to effectively manage their talent, Epstein says technology streamlines the process.