Strategic Capability Planning

Brief: 
  • ABB has created a “capability planning” process to integrate its five-year business strategy with the people actions necessary to deliver it.
  • The model provides a clear line of sight between the strategic business objectives and ABB’s Talent Management (internal talent pool), Talent Acquisition (external pool), Learning & Development, Workforce Balancing and Global Mobility functions.
The problem addressed by the campaign: 
  • ABB’s workforce capabilities were unlikely to be sufficient to deliver ABB’s strategic business objectives.
  • In addition, capability gaps were not identified early enough so that talent acquisition and competence development activities could be aligned effectively with business needs.
Solution: 
  • The HR function and line management worked together to develop a capability planning process to align ABB’s talent strategy with its business strategy.
  • HR business partners and business leaders conducted capability planning sessions in which they: 
    • Identified five to seven core themes per business entity that were necessary to deliver on ABB’s five-year business strategy
    • Identified and compared capabilities needed to deliver strategic themes against current capabilities to determine gaps and surpluses 
    • Developed a range of people actions to ensure that workforce capabilities matched business needs
    • Used Talent Acquisition, Talent Management, Learning & Development and Global Mobility HR functions to achieve business goals 
  • The process translated business objectives into concrete “people actions”.
  • The actions developed were revisited every three to six months to “iteratively tune” the people actions and to track progress against the five-year business strategy.
Impact: 
  • When aggregated group-wide, a small number of “capability white spots” were identified and are now addressed through targeted talent activities.
  • Guided by HR business partners, business leaders have produced an effective talent pipeline – especially for key technical and specialist roles.
  • A cluster of 30 to 40 core organizational capabilities have been developed to form a common language and dialogue across ABB’s very different businesses and geographies.
Why has it worked?: 
  • Necessary capacities for action are translated into desired workforce skills and behaviours.
  • A common language is used to bridge the gap between different businesses entities.
  • Capabilities are continuously re-examined and upgraded to fit changes in the business strategy.
  • The model creates a talent pipeline with a clear line of sight to the business strategy to avoid future capability gaps
  • .Over time and with practice capability planning will become a part of the natural mind set and culture of ABB.
Conclusions and Recommendations: 
  • Keep it simple
  • Avoid complex spreadsheet-based headcount models
  • Retain the link to the business objectives at all times
Foundational Issues: 
Information gaps
Level of Collaboration: 
Level 1: Collaboration within the organization
Region: 
Global (all of the above)
Economic and political context: 

ABB financials:

  • Sales: US$ 35.2 billion
  • Profits: US$ 3.2 billion
  • Assets: US$ 39.9 billion
  • Employees: 130,000

ABB talent strategy:

  • ABB fills around 80% of management roles and almost all senior management roles internally
  • Long length of service – many people have been there between 15 and 25 years
  • Average turnover rate is low – estimated below 10%
About the Author(s): 
  • ABB provides power and automation technologies designed to improve performance and lower the environmental impact for its utility and industrial customers.
  • The ABB Group of companies operates in around 100 countries and employs about 130,000 people.
  • Historically, ABB has generally promoted from within for critical jobs and management positions, as opposed to recruiting from the outside market