Six in 10 firms have no “systematic or strategic approach” to recruiting, developing and retaining talent to meet future business needs, according to a joint study.

Published by the Boston Consulting Group (BCG) in collaboration with the European Association for People Management (EAPM) and the Chartered Institute of Personnel & Development (CIPD), the report, ’Creating People Advantage 2011 –Time to Act: HR Certainties in Uncertain Times’, surveyed more than 2,000 executives across 35 European countries about trends in HR.

Derek Irvine, vice-president client strategy and consulting at Globoforce, a provider of SaaS-based employee recognition solutions, says: “This study highlights a worrying trend in organisations today – a failure to foster talent. With a happy, motivated workforce absolutely critical for any company that wants to succeed and grow, surely a sound talent management policy – whereby employees are actively rewarded for good work – is an absolute necessity?

“Indeed, with the Hay Group estimating that replacing a staff member can cost up to 150% of that person’s annual salary, those companies that fail to address talent management immediately and strategically may quickly find themselves embroiled in a vicious circle of constantly recruiting and training new staff to replace highly talented and knowledgeable individuals who decide to leave.

“Strategic and ongoing recognition programmes have been proven to elevate the engagement and increase the retention levels of employees. Given what’s at stake, it seems a wise investment for organisations to make.”