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Friday, August 29, 2014

Aberdeen CPO Summit: Coming Brain Drain Will Intensify Talent Search

During a session at Aberdeen Group’s Ninth Annual Chief Procurement Officer Summit in Boston (Oct. 29-30), a speaker asked attendees summarily whether they were satisfied with the level of talent in their organizations?

“No one raised a hand,” said Michael Campanale, vice president of business development for Kenexa, an IBM company based in Wayne, Pa. Kenexa specializes in recruiting, hiring, compensation, succession planning, and other areas relating to the acquisition and retention of workforce talent.

Credit: Stuart Miles at

Credit: Stuart Miles at

The silent audience response spoke volumes about a big concern of CPOs and others in supply management: the need to find talented people who can deliver major contributions to a business and bring game-changing vision to operations.

In other words, CPOs will be counting on those vital individuals who will help them achieve growth consistent with strategic goals.

The need for companies to find the right operational people will be a major if not urgent concern in the coming years. Campanale believes that the talent shortage in critical skills will intensify as more Baby Boomers retire and companies scramble to replace the institutional knowledge that will be lost.

“In the next five to six years, 80 million Boomers are going to leave the workforce,” he said. The factors driving this are not only age and recent growth in 401(k) and other pension funds but also improving personal finances. “People are almost whole on their finances following the Great Recession,” Campanale commented.

Kenexa, which has been in business for 25 years and, according to company statements, placed 80,000 people in jobs worldwide, applies a range of technologies — notably predictive analytics — to recruitment and hiring processes. Its science in these areas is what attracted IBM to the company, Campanale said. IBM isn’t just computers and information technology, he noted, but a specialist in software, engineering, financials, operations, and purchasing. When IBM acquired Kenexa in December 2012, the move broadened its service capabilities and markets.

Kenexa provides a number of recruitment services. Each, however, is oriented toward determining what a company wants in terms of a candidate’s background and experience, the potential an individual has for acquiring new roles, and how well his or her personality, motivation, people skills, and innovation match needs and expectations.

Campanale says Kenexa is interested in determining if there is a “cultural match” between a candidate and an organization that would improve an individual’s potential for success. Kenexa also uses its tests, or “assessments,” to discover additional talents of candidates. “People are born to do something,” he explained, and the assessments are ways of bringing out strengths that might be worth cultivating.

The company uses various internal software programs to aid evaluations. It also has people dedicated to learning the culture of organizations for which it recruits; it employs 100 or so industrial psychologists to develop assessments and evaluate candidates.

Cost avoidance is a big consideration. Campanale says Kenexa wants to recruit and place the best people, of course —but equally important is making sure they stay. “The cost of turnover is astronomical,” he remarked. A senior salesperson who leaves an organization after only two years can cost the company $500,000 when all expenses are tallied.


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