Talent Reviews: Because Guess What? They Actually Boost Your Business

Co-Autored by Tracy Cote and Tina Figueroa

If your HR person isn't spearheading a companywide talent review, it's time they start. A talent review is not just another HR process; it's a strategic tool that can transform your organization. It's an important vehicle for assessing your people, developing your succession plan, and creating talent density. Thoughtfully building a high-performing team will boost your efficiency and have a huge impact on your ability to meet and exceed your business goals.

After establishing your long-term business strategy and defining your Annual Operating Plan (AOP - see this article for guidance on how to do this), addressing your talent needs becomes the next critical step for driving operational efficiency. The outcomes of the talent review should directly correlate with your business's performance. For instance, if a department fails to meet its business goals despite being led by someone considered a high-potential, high-performer, this discrepancy demands attention and action.

Most performance management processes are just going through the motions, which is why they aren't effective. Businesses are under increased pressure to improve performance and need an approach that works. Common challenges include poorly cascaded goals, inconsistent feedback, bias in evaluations, an excessive focus on quantitative metrics at the cost of qualitative insights, and a generic approach that doesn't account for organizations' diversity and complexity. An effective process should drive clear outcomes and milestones, be transparent and fair, and allow managers to provide continuous feedback tailored to their employees' needs and context.?

A universal step that every company should implement—regardless of whether they use OKRs, Goals, or V2MOMs—is to conduct a talent review. This practice can supplement or replace traditional performance evaluations, enabling you to assess your current leaders' performance results, alignment with cultural values, and future potential. Depending on your culture, you can customize the performance management part of the process to include ratings on varying scales with different labels and a distribution or rankings model—or none of the above. Every company approaches this slightly differently, which is why it's an ongoing conversation; what you choose to do depends upon your values, organizational readiness, and needs. However, the common denominator in every performance process must center around the talent review.

The draw of the talent review process lies in its ability to drive consistent standards. It is a highly adaptable process that continues to improve over time; while every company will implement it differently, each should integrate a deep and regular conversation about their people to promote accountability, transparency, and proactive action. Talking about your talent and calibrating cross-functionally is critical to driving high performance while keeping your team engaged. By default, your managers and leaders will discuss their teams with each other; it's an inclusive learning experience that promotes fairness and reduces bias while valuing their contributions and making them feel integral to the company's operations.

A robust talent review process will drive accountability and be a catalyst for change. Key areas typically addressed include:

• Business and departmental challenges, roadblocks, dependencies
• Cross-functional calibration
• Talent capability identification for current and future business objectives, including skill gaps, critical positions, and key personnel
• Risk identification (e.g., potential departures, single points of failure)
• Determination of bench strength
• Identification of successors and succession planning gaps
• Talent mobility assessments for readiness for subsequent roles

A common talent review framework is a 9-box grid tailored to your organization's language and needs. This grid helps maintain objectivity and simplifies evaluating talent, reducing the stress associated with performance ratings. The focus is on identifying high-potential individuals, differentiating and calibrating talent, and identifying areas for development. The outputs from this process include individual and departmental development plans, opportunities for leaders, and focus areas for building talent acquisition pipelines for any external succession gaps. It should also include concrete plans to coach underperformers up, across, or out within a specified period. The summary of actions from your talent review also produces a thoughtful artifact for presenting to your Board, informing them about your organizational health and go-forward plans regarding your people.

Conduct a comprehensive talent review annually to inform your performance conversation processes, including a mid-year check-in. These discussions deserve significant time—allocate at least half a day to ensure a thorough and effective dialogue. While 9-box grids are typically used for leadership development, you can decide whether to cascade them through your organization or restrict them to director-level positions and above, depending on your internal management preferences.

Talent reviews are essential to your performance management and goal-setting process—they help you understand your people, plan for the future, and ramp up your talent pool to improve business performance. Building a high-performing team is vital as businesses aim to do more with less. By spending as much time on your talent as you do on your product strategy, you will increase efficiency and boost your chances of hitting and exceeding your goals. So, making time for a talent review isn't just smart; it's a game-changer for your organization's success.