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Talent Management vs. Performance Management: What’s the Difference?

Introduction

Talent and performance management plays a key role in the execution and success of the company and its employees. They play an integral part in the development of the workings within an organization valuing business elements and leveraging talent. But what exactly are performance and talent management, and how do they differ? Read on further to join the discussion of talent management vs. performance management, where we understand the key differences between the two. Let’s go!

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What is talent management?

Talent management is the strategic process of attracting, developing, and retaining talent for and within an organization. Talent management is workforce planning for talent retention and execution, keeping the organizational goals in mind. It aims to secure talent and retain it. 

What does talent management involve?

The primary role of the talent management process is to identify and bridge gaps in talent and vacancies.  The talent management team would be responsible for sourcing and onboarding suitable candidates. They would also be concerned with training and helping employees grow with respect to their skills and expertise in order to achieve their own and the organization’s goals and objectives. 

The talent management team typically:

  1. Acquires talent through recruitment, onboarding, and promotion. 
  2. Assesses talent through talent assessments, talent cycles, and analytics
  3. Develops talent through workforce planning, bridging gaps in employee engagement, retention, and talent vacuums developing best practices for these. 
  4. Deploys talent in the organization by setting goals and mapping specific activities for employees.

Why is talent management important?

Talent management is one of the key components of human resource management and ensures that highly talented and skilled employees are attracted and retained in a company. This, in turn, contributes to the value of an organization helping it grow and improve. An effective talent management process will ensure that employees are motivated enough to achieve their goals over and beyond whilst also decreasing attrition rates, contributing to a continuous flow within the company with fewer talent vacuums. Satisfied and driven employees can increase customer satisfaction and help achieve organizational objectives.  At the end of the day, no matter the product, a company is built by people.

What is performance management?

Performance management refers to a set of processes that are aimed at enabling employees to make use of their skills and function to the best of their abilities. The primary goal of performance management is to streamline employee performance to match organizational standards and goals. This is done widely by managers where; they establish communication with their subordinates to help them accomplish their tasks. This is not to say that performance management is performance appraisal that occurs cyclically. It is, rather, an ongoing process where leaders assess and analyze employee potential and performance involving feedback and documentation. 

Why is performance management important?

Performance management helps streamline effort within the organization, and if determined clearly, performance management can help employees, HR professionals, and managers become acutely aware of their role and functions within the company and helps identify gaps in performance and goals faster with efficiency. This will help yield better results for the business with talent being implemented in the right places in the right ways. 

What is the difference between talent management and performance management?

Both talent management and performance management are terms related to human resource management, yet they mean two different things. Talent management covers a broader process within the HR domain, whereas performance management is a niche process operating within the umbrella of talent management. While talent management focuses on the entire cycle of an employee within an organization, including training, onboarding, and promoting, performance management only operates at one level of measuring and assessing employee performance. Performance management is a tool used mostly by superiors for their subordinates, whereas talent management is broader and encompasses more than just employee assessment. 

Source: GreatLearning Blog

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