Revealed for HR Leaders: Why Internal Talent Mobility is the New Competitive Advantage

Imagine you’re a coach with a team of highly skilled players. Your star forward is sidelined with an injury, but you don’t worry because your backup player steps in and knocks it out of the park. That’s exactly how internal talent mobility works in the world of business.

Let’s face it: finding top talent externally is tough (and costly!). But here’s the secret sauce—companies that embrace this practice can turn their workforce into a goldmine. So, what exactly is internal talent mobility, and why is it the new competitive advantage HR leaders should be all over? Buckle up, because we’re about to dive into the why and the how of it all.

The What and Why of Internal Talent Mobility

Let’s start with the basics—what exactly is internal talent mobility? In the simplest terms, it’s the practice of moving employees to new roles, projects, or departments within your company rather than looking externally for new hires.

But it’s not just about plugging holes; it’s about talent growth, fostering skills, and giving employees the opportunity to explore new career paths within your organization. Sounds like a win-win, right?

And why is it the new big deal? Well, because it solves multiple problems at once. First, it saves money. According to Deloitte, external hires can cost 1.7 times more than internal moves.

Second, it helps with retention—who doesn’t want employees who are excited to grow where they are instead of jumping ship for greener pastures? Plus, employees are more productive and engaged when they feel their careers are evolving.

But that’s just the tip of the iceberg.

Talent Mobility = Retention, Retention, Retention!

Ever wondered why employees leave? Sure, money plays a role, but it’s not always the main culprit. More often, it’s that feeling of being stuck, like they’ve hit a ceiling with no room for growth. Cue the dramatic soundtrack! Enter talent mobility—the unsung hero of employee retention.

When companies actively promote internal opportunities, they’re sending a clear message to their workforce: “We see your potential, and we want to help you flourish.” It’s like telling your employees, “You don’t need to go elsewhere to climb the career ladder—the grass is just as green, if not greener, right where you are.”

This sense of being valued and having a clear path forward is a game-changer for job satisfaction. Employees start seeing their current employer not as a dead end, but as a place for talent growth and career advancement.

Let’s break it down with some numbers. According to a LinkedIn study, employees who experience a promotion or internal move in the past three years are a whopping 70% more likely to stay with the company. Why? Because internal mobility makes them feel like they’re moving forward, not stuck in place.

By embracing this process, companies create an environment where employees are more engaged, motivated, and loyal. It’s like giving them a map for their future, with your organization right at the heart of it. And when employees see a future with you, they don’t just stay—they thrive. 

Case Study: Schneider Electric’s Power Move

Let’s get into a real-world example. Schneider Electric, a global leader in energy management, recognized that in a rapidly changing industry, fostering internal talent was critical. They implemented a robust talent mobility program allowing employees to shift roles or take on temporary assignments in different departments across the globe.

The results? They saw a 20% decrease in turnover among employees who participated in their program. Not only that, but their internal fill rate for leadership positions skyrocketed, proving that investing in your existing team pays off in spades.

Their secret sauce was combining technology (AI-driven platforms to match talent with roles) with a clear message: we invest in you, so you invest in us.

A New Era for HR: Moving From “Talent Acquisition” to “Talent Retention”

Think about this for a second: if all you do as an HR leader is constantly focus on talent acquisition, you’re fighting an uphill battle. You might win a great candidate today, but if your internal structures don’t support talent growth, you’ll lose them tomorrow.

Instead, successful companies are flipping the script. By focusing on developing and moving internal talent, they reduce the need for frequent external hires. It’s less “let’s find new people,” and more “let’s find new paths for our people.” That’s a game-changer, right?

Does Talent Mobility Mean Less Hiring?

Not exactly! Don’t get me wrong; external hiring will always play a role. But when talent mobility is in place, external hiring becomes more strategic. Rather than scrambling to fill every open position, companies can look for specialists or fresh perspectives to complement their internally growing talent pool.

Take SAP as another real-life example. SAP has committed to re-skilling and up-skilling its workforce, which has reduced the need for external hires by nearly 40% in key areas.

Their leadership noted that the company’s approach to internal talent growth has created a more agile and versatile workforce, reducing time-to-hire for critical roles. The moral of the story? It’s not about hiring less, but hiring smart.

Making Internal Mobility a Seamless Process

So, we’ve established why the process is a game-changer. But here’s the million-dollar question: how do you actually make it happen? You can’t just send out a memo saying, “Okay team, time to switch it up!” Nope, this requires a well-crafted strategy and some smart tools to grease the wheels. Let’s break it down step-by-step.

1. Build a Culture of Mobility

First off, you need to cultivate an environment where moving within the company is seen as growth, not disloyalty. If employees think jumping to a new role will make them look flaky or disloyal, they’ll stay glued to their seats. Leadership has to set the tone by openly supporting and celebrating internal moves.

If the execs aren’t championing mobility, no one else will. Think of it as creating a culture of adventure—employees should feel like exploring new roles is a key part of their personal and professional development, not something that raises eyebrows.

2. Leverage Technology

It’s 2024, folks. Forget about using backroom gossip or gut feelings to match people with new roles. AI-powered platforms like Gloat, Fuel50 or Engagedly are out there, designed to help HR teams identify employees’ skills and career aspirations.

These tools do the matchmaking heavy lifting, recommending opportunities based on data, not guesswork. The right tech streamlines the process, making internal transitions smoother and faster.

3. Transparent Career Pathways

Here’s the thing: people need to see the path ahead. If there’s no map, they won’t bother moving. HR should create clear career progression frameworks where employees can easily see how an internal move can get them closer to their goals. Whether it’s a lateral move or a step up, employees should know exactly what skills or experience are needed to move forward.

Case Study: PepsiCo’s Talent Growth Initiative

Let’s spice things up with a second case study. PepsiCo, one of the world’s largest food and beverage companies, made internal talent growth a top priority. They realized that to keep pace with the rapidly evolving industry, they needed to develop leaders from within rather than constantly seeking external talent.

PepsiCo created a detailed career mapping program that encouraged lateral movements across different business units. They introduced mentorship programs and used technology to track skills development. The result? A 30% increase in internal leadership promotions, and over 80% of their senior leadership roles were filled from within.

They even noted that employees who moved laterally within the company were more likely to take on leadership roles in the future. 

Barriers to Internal Talent Mobility (And How to Overcome Them)

Alright, this all sounds like the dream solution. But let’s not pretend it doesn’t come with its own set of challenges. Moving people around internally isn’t always as smooth as you’d hope.

1. Manager Resistance

Ever tried prying a beloved toy from a toddler? That’s how managers feel about losing their top performers. They’ve invested time and energy into developing these employees, and the idea of watching them transfer to another department feels like a gut punch.

I get it—no one wants to lose their star player right before the big game. But here’s the rub: keeping talent in one spot for too long not only stunts the employee’s growth but also hurts the company overall.

So, what’s the fix? HR leaders need to work closely with managers to shift their mindset. It’s not about “losing” talent, it’s about growing it in a way that benefits the whole company.

Managers need to understand that if talent mobility becomes ingrained in the company culture, they’ll also gain access to an even broader pool of internally developed, skilled employees. It’s a give-and-take situation that ultimately pays off.

2. Skills Gaps

Let’s be real: not every employee will be ready to hit the ground running in a new role. That’s where targeted development comes in. Upskilling and reskilling are crucial to ensuring that employees aren’t just being moved around aimlessly.

Companies need to invest in training programs that bridge skill gaps and prepare workers for new challenges. Because the goal isn’t just mobility; it’s meaningful, impactful mobility that drives both individual and organizational growth.

The Competitive Advantage of Tomorrow

Why is this the new competitive advantage? Because it’s not just a shiny HR trend; it’s a long-term strategy that keeps your workforce engaged, agile, and ready for whatever comes next.

Think of it this way: in today’s rapidly changing business landscape, adaptability is your company’s secret weapon. You’re not just running a race with the fastest car—you’ve got a pit crew that’s constantly upgrading the engine.

In a world where technology, market conditions, and customer expectations shift faster than ever, having a workforce that can pivot and grow within the company is a game-changer. When employees know they have opportunities to grow and evolve internally, they’re more likely to stay put and give their all.

In fact, they’re not just sticking around; they’re thriving. Engaged employees are more productive, more innovative, and more willing to go the extra mile.

And here’s the kicker: fostering talent growth from within doesn’t just improve employee engagement—it also slashes turnover rates and recruitment costs. Instead of spending thousands of dollars (and countless hours) searching for external hires, you’re filling critical roles with employees who already understand your company’s culture and values. It’s like growing a garden; rather than constantly buying new plants, you nurture the ones you already have.

Conclusion

Internal talent mobility isn’t just a passing fad—it’s the future. By investing in your current employees and giving them the room to grow, you’re building a workforce that’s resilient, innovative, and ready to meet the challenges of tomorrow. While your competitors are still stuck in the hiring rat race, you’ll have the talent you need already thriving inside your organization.

 

FAQs

What is internal talent mobility?

Internal talent mobility is the practice of moving employees to different roles or departments within a company to optimize their skills and foster career growth.

Why is internal talent mobility important?

It boosts retention, reduces hiring costs, increases employee engagement, and allows companies to develop talent internally rather than relying on external hires.

How can companies overcome barriers to talent mobility?

Overcoming barriers like manager resistance and skill gaps can be achieved through strong leadership support, transparent communication, and investment in upskilling programs.

What role does technology play in talent mobility?

Technology, like AI-driven platforms, can help match employees with internal opportunities that suit their skills and career aspirations, making the process seamless and efficient.

What are the benefits of investing in talent mobility?

It leads to improved employee retention, faster filling of critical roles, cost savings on external hires, and the development of a more adaptable workforce.

How to Get Started with an Internal Talent Marketplace?

Organizations worldwide are searching for innovative ways to develop and retain valuable talent. Among such ways, the internal talent marketplace has gained significant traction in recent years to harness the full potential of the company’s workforce. It fosters a culture of talent mobility, agility, and continuous learning.

An internal talent marketplace is a centralized HR platform that allows employees to showcase their skills, interests, and career plans within the organization. Companies provide this marketplace to their workforce to let them explore cross-functional projects, concepts, and assignments and grab the right opportunities.

This talent marketplace is a platform to optimize the company’s talent management and increase employee engagement. Engagedly, a leading performance management organization offers comprehensive solutions to cultivate an internal talent marketplace. How does the internal talent marketplace work? If you want to boost your company’s diversity, equity, and inclusion with an internal talent pool, scroll down now!

Best Practices to Launch an Internal Talent Marketplace

Best Practices to Launch an Internal Talent MarketplaceAn internal talent marketplace can be a game-changer for companies to optimize their talent management process. It fosters career growth and ensures the organization’s success by showcasing workforce skills. How do you develop an internal talent marketplace? The following are the best practices for setting up an internal talent marketplace:

Setting up a Team

Successful implementation of the internal talent marketplace requires a leadership position within the organization to take care of the related duties.

A project manager in the marketplace should act as an external consultant or professional to take care of the initiative. The IT leader handles the design and integration of the platform, while the HR manager can ensure the employees follow the company’s policies. The team members ensure effective communication and coordination within the marketplace, liaising between departments and employees. It facilitates information sharing and feedback in a collaborative environment where employees can grow professionally.

The marketplace’s dedicated team helps nurture organizational talents by closely monitoring employee performance. It identifies potential individuals for specialized roles within the organization, helping retain valuable in-house talent.

Moreover, the team members are responsible for conducting workshops, mentorship opportunities, or training programs that enhance employee satisfaction. It powerfully conveys to all employees that their skills and knowledge are valued and essential for the company’s growth opportunities and success.

Also read: 5 Employee Engagement Statistics You Should Be Aware of in 2023

Appointing a Marketplace Leader

A managerial leader has a precious role in setting up an internal talent marketplace and driving organizational change. They ensure that the marketplace integrates entirely with the company culture and process. The leader helps employees understand the organization’s changes and addresses their concerns. They work closely with the senior leaders to understand the higher-level objectives so that the marketplace supports the company’s overall vision.

The internal talent marketplace encourages existing employees to develop new skills and experiences. Marketplace leaders increase visibility and opportunities for internal employees, improve employee retention, and maintain a high-performing workforce.

Moreover, the internal talent marketplace relies on technology and data to match employees with the right projects. The leader ensures all the necessary technology infrastructures are in place and the marketplace utilizes data-driven insights. It helps in efficient resource allocation and improves the potential of the marketplace.

Considering the Company Culture and Hiring Vendors 

Company Culture and Hiring Vendors Launching an internal talent marketplace can be expensive or time-consuming for some organizations. HR departments can hire a vendor to guide them through installation and integrate HR applications like authentication, human capital management, and learning systems.

Employees need clarification about how to proceed in the marketplace because it gives them different career choices. Companies can offer career coaching programs with their internal talent marketplace to help managers craft job postings. It helps employees create personal profiles, articulate individual goals, and pursue development programs.

Organizations must be mindful of their culture and boost managerial knowledge through the internal talent marketplace. The vendor providing the platform for the internal marketplace must match the organization’s values. Moreover, training can also help sustain a learning culture in the workplace. Promoting communication solutions will make employees feel valued and prepare them to use the marketplace. Companies can conduct live Q&A sessions for the staff to make them understand the significance of this marketplace.

A digital internal talent marketplace through a vendor like Engagedly helps smooth the process. The platform assists employees in finding part-time projects, which reduces skill gaps. It connects employees with online courses and development programs, leading to career advancement. A primary agenda of this marketplace is improving remote workers’ career growth because they miss out on announcements of internal opportunities.

Also read: 5 Best Tips to Reduce Employee Turnover

Maintaining the Psychological Safety of Employees

Psychological safety in the work environment ensures employees feel safe handling risks and expressing opinions. It helps them contribute their ideas in the workplace without facing criticism. HR departments should communicate the benefits of the internal talent marketplace to the employees. It includes opportunities for career development, exciting projects, and other skills.

The marketplace should store employee information with confidentiality and privacy. There should be strict data protection or measures to build trust and avoid misuse of information. Moreover, managers are responsible for teaching employees how to use the marketplace, from creating profiles to networking.

Companies should not discriminate against certain employees or promote bias in the marketplace. Opportunities should be available equally for all employees to encourage diverse perspectives and create a vibrant and inclusive talent pool. Feedback mechanisms must also encourage all employees to provide input and share their experiences.

Companies should recognize employee contributions and highlight their accomplishments to motivate them and their peers. This recognition boosts a positive environment and encourages other employees to participate in the marketplace.

Psychological safety also includes regularly adapting and evaluating the internal talent market. Managers and employees should undertake necessary adjustments to make the platform successful and updated. 

Benefits of Setting up an Internal Talent Marketplace

Internal Talent MarketplaceWhat is internal talent? These talents comprise the organization’s current employees. Developing and promoting internal talent has several benefits, like the following:

Empowers Employees

Internal talent marketplace gives employees control over their department by making them understand the department’s objectives, cognition style, and work preferences. Top performers from the department get motivated to learn new things and from different leaders. This way, employees feel more engaged, boosting the retention rate and company culture. Though implementing the marketplace changes seems challenging, vast career choices await talented employees.

Retains Employees

Most employees leave their organizations for better opportunities, salaries, and perks. However, flexibility and career development plans are also important factors. An internal talent marketplace is a centralized platform to retain employees. This practice takes a considerable approach toward internal mobility, developing employees’ skills, offering competitive compensation, and increasing engagement and retention. Employees get new and different work or learning opportunities and new gigs, projects, and roles through an internal talent marketplace.

Increases Engagement 

Internal talent marketplace and internal mobility go hand in hand to boost employee morale. These practices improve the company culture from within by showing a clear commitment to supporting employee development. The marketplace can be optimized for new roles or training opportunities because of its transparent and navigable nature.

Also read: How Can Setting Employee Goals Help Your Organization?

Summing Up

In conclusion, setting up a marketplace can be a highly effective internal talent strategy for organizations looking to optimize their workforce and unlock their potential. Companies can foster a culture of collaboration, innovation, and continuous learning through this platform, where managers can quickly identify and deploy talent. However, it is essential to recognize that implementing an internal talent marketplace requires careful planning, effective communication, and ongoing support from leadership. Organizations can create an environment that promotes employee growth and development with the right approach and commitment to nurturing talent.

Engagedly specializes in employee performance management software, providing a comprehensive platform to manage and improve employee performance, engagement, and retention. We offer several talent management features, including goal setting, continuous feedback, performance reviews, and learning management. Engagedly’s software is designed to empower employees, foster a culture of continuous improvement, and drive organizational success. With its user-friendly interface and robust analytics, Engagedly has become a reliable partner for companies looking to enhance their performance management processes. Book a demo today!

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Frequently Asked Questions

Q1. What makes an internal talent marketplace succeed?

Ans. The booming internal talent marketplace requires HR departments’ or managers’ potential thinking skills. Its success depends on employees’ skills, knowledge, and upskilling of existing courses.

Q2. Are there any benefits of talent reviews?

Ans. Talent reviews are one of the strategic tools in a company that encourages employee feedback. It takes place laterally between managers and senior leadership. It provides a centralized platform to discuss employee performance reviews and direct departmental reports to support the future of work.

Q3. How does talent mobility help companies grow?

Ans. Talent mobility increases employee retention rate and continuous learning and development within the organization. With the career developmental options, employees get vast choices to excel in their fields. Having highly skilled and knowledgeable employees helps the company grow in the long run.