Managing Talent at Bertelsmann AG (A) Harvard Case Solution & Analysis

However, the plan identified by the company regarding hi-po started losing its charm. The reason was simple; the approach of the management and the overall structure at the company was something that derailed the mission and eventually led to the failure of the identification and evaluation of the high potential employees program. The reason which actually led to making the overall idea or program fail was due to the fact that not all of the Bertelsmann businesses applied succession planning as rigorously, and recruitment especially in terms of attracting hi-post from top MBA programs.

The argument that led to the misunderstanding of succession planning was because the division head wanted to keep hi performers within the team to make the team grow, however, the board management for the company Bertelsmann wanted the potential leaders to come up at the board meetings. This was basically a confusing approach where the hi-po felt they were deprived of career growth, eventually leaving the jobs for better opportunities. The reason was simple, the organization as a whole was unable to provide the top performers challenging and demanding positions within the company. With the company focused on developing hi-po at Bertelsmann it is obviously a necessity to develop a succession planning to cater the needs and wants of such a large work force.

With the above discussed approach of Mr. Hermreck where he versioned that each of the basic purpose of hi-po will be to become part of the leadership and top demanding positions at the company. However, he did not eventually educate his division heads the need for the succession planning. The team and the management were more inclined towards the decision making at individual level. Since the company followed a decentralized organizational structure they were keen to fulfil the business needs. Along with this, the bonus, incentives and stock options were provided on high performance. Therefore, the potential managers were not released by the respective department or by the management of particular division because they did not want to lose on the opportunity of earning profit revenue to become part of the bonus allocation.

Since the idea of hi-po identifying potential managers for the company, the plan of succession was quite motivating and convincing, but it had its flaws, some major ones as well. Keeping this in mind, the idea scenario to ensure that the plan becomes a success is solely based on the coordination and communication among different departmental heads and the respective management. As the company operates with a few names and has a decentralized structure it is rather difficult to motivate all employees.

Therefore, the recommendation for the company Bertelsmann is to align the mission of the company with all the divisions and the 50 other companies operated by the parent company. As for now, the decentralized structure has actually allowed the company to restrict the decision making. The company does not even have all the companies under one single parent company. Some of the companies under Bertelsmann AG operate at individual levels which makes the decision making totally dependent upon the discretion of the management of the particular company. To overcome this issue and to revive as the sole authority it is necessary to communicate the standard operating procedure at Bertelsmann so that in future, if the company decides upon some specific decision then then management will acknowledge it across all other companies and eventually support it so that the decision can become a credible source for all the companies operating under the umbrella brand of Bertelsmann.

Indicate whether Mr. Hermreck took the right approach and made the right choices in terms of talent development? Explain your position and, if appropriate, offer him recommendations for improvement.

Mr. Hermreck actually took the right approach in terms of talent development. The reason is simple; the leadership competencies that were predefined for the talent were as follows: entrepreneurship, partnership, creativity and citizenship. These were the four categories that Mr. Hermreck had identified to determine the leadership competencies in the individuals. Mr. Hermreck had to develop the talent and manage it, the company shared the responsibilities between individuals, the line management and the human resource. Along with this, to develop the talent at Bertelsmann AG, the company actually provided the concept of Create Your Own Career.

Create Your Own Career (CYOC); this concept was again a development towards the talent retention and management where the employees especially the potential leaders or the hi-pos were made to develop their own career path at Bertelsmann. Along with this, senior exposure was highly relevant for individual career tracks as it was also a part of talent development process at the company and it was a plan by Mr. Hermreck............................

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