McKinsey coined the term War for Talent. But in these times of layoffs, furloughs, and reductions in force, are we seeing a War on Talent? Attitudes towards human capital are radically shifting as the economic ground tremors persist. Here’s one example:

The top business challenges identified in a new Pulse on Leaders global study by Personnel Decisions International (PDI) are:
1. Financial pressures to cut costs (83%)
2. Rapid market decline (54%)
3. Competitive threats (23%)
4. Access to capital (23%)
5. Realizing the full potential of a recent merger or acquisition (16%)
6. Taking advantage of pockets of rapid market growth (16%)
7. Leveraging global expansion investments (13%)
8. Loss of leaders in key areas or insufficient talent to quickly adapt to change (5%)

A similar study in the Fall of 2008 identified these top challenges:
1. Achieving top-line growth (46%)
2. Talent management (33%)
3. Meeting financial objectives (23%)
4. Implementing business strategy (13%)
5. Developing business strategy (13%)
6. Infrastructure/operations issues (12%)
7. Mergers and acquisitions (11%)
8. Current customers (11%)
9. Capitalization/cash flow (11%)
10. Organizational culture/change (9%)

The perceived war for talent is no longer motivating an executive focus on talent management. The people agenda is now hanging precariously at the bottom of the priority list even though the value drivers are clear.

Business executives may be under the impression that there is top talent readily available on the market. They may think that the business can easily replace anyone. In that mindset, talent management loses its focus and employees are commoditized. Without a leadership focus on talent management, the war for talent could morph into a war on talent.

The research bears out the facts against commoditization of people: talent is complex and not a simple function of supply and demand. Turnover replacement costs are real and time to hire creates a void where business performance is stressed or stalls while waiting to fill the role.

Talent management isn’t only about recruiting quality talent in a time of growth. Successful talent management practices impact the bottom line in any economic season.