What is an Internal Talent Marketplace?
The talent crisis is more real and fiercer than ever, driven by new ways of work and AI developments. In the face of talent shortages and evolving workplace demands, many forward-thinking leaders have started looking deeply from within their organizations for solutions.
A global Deloitte survey revealed that 85% of HR executives among over 1,200 professionals planned to redesign work organizations to flexibly transfer skills across tasks since 2022. Additionally, Gartner predicts that by 2025, 30% of large enterprises will have deployed talent marketplace solutions—which is now considered the third most critical emerging HR technology among many HR leaders—to optimize the utilization and agility of talent.
As Josh Bersin talked about this HR solution: "Not only does it save money on recruiting, it enables companies to find internal expertise which is often hidden in the organization.
And it creates a strong sense of engagement and belonging in the workforce."
But what actually is an internal talent marketplace? And why it's so important to help leaders level up their workforce for higher productivity and happier work life from the inside out?
By the end of this article, you will have the answer to all of these questions, as well as key steps for companies to get started with an internal talent marketplace.
Key Drivers Behind the Internal Talent Marketplace Adoption
The Talent Marketplace (or Internal Talent Marketplace) is the new wave of transformation in how leaders approach talent management.
Simply put, an internal talent marketplace is a dynamic digital platform within an organization that leverages AI to connect employees with internal job opportunities, projects, and roles.
But trust me, it's not as foreign as it might seem!
If you've ever considered reorganizing your team to better align their skills with critical projects or giving stretch assignments to your employees to help them develop new capabilities, you're already engaging with the core ideas behind a talent marketplace.
Initially conceptualized as simple job boards, internal talent marketplaces have evolved into sophisticated systems powered by artificial intelligence and your people data to match employees with roles that align with their skills and career aspirations.
First and foremost, better skill utilization and workforce allocation save HR costs. To be specific, companies can save more than USD$50k per retained employee by reducing hidden costs, including lost productivity and the effort required to get new hires fully up to speed.
But there are more genuine drivers of the internal marketplace adoption:
- The Need for Workforce Agility: Modern organizations must adapt quickly to changing market conditions and business needs. The integration of AI in business operations is a prime example. AI is reshaping strategic priorities, from data analytics to customer service automation, requiring new roles and skill sets.
Companies should have more specialized tools and systems to unlock their team potential to the fullest to meet these demands.
- Employees’ Desire for More Opportunities: Your teams might be thinking the same! According to 2024 research by TalentLMS and Vyond, 61% of employees are aware of their skills gap, and 41% said they would look for opportunities elsewhere if their companies don't provide them with training opportunities in the next year. Another global survey by PwC on a larger scale tells a similar story: 74% of employees are willing to be upskilled or reskilled to adapt to the future of work.
That's exactly the gap between where the internal talent marketplace comes in.
Internal talent marketplaces offer a flexible system for talent deployment, allowing companies to rapidly reallocate resources to high-priority projects, ensure that the right talent is in the right place at the right time, and deliver better matching learning and development opportunities for their people.
With this purpose-built technology, companies can make data-driven decisions based on real-time insights into employee skills, availability, and performance, enhancing overall organizational responsiveness and agility.
As a result, internal talent marketplaces emerge as new internal mobility enablers that leaders need to transform their approach to talent management.
This reflects a broader trend in HR practices towards a more agile, people-centric, and skill-based workforce.
And with the increasingly popular of AI in HR, internal talent marketplaces with AI power at their core are more clearly at the forefront!
Why Does an Internal Talent Marketplace Matter?
Talent marketplaces benefit companies in multiple ways, but here are the most critical reasons that make internal talent marketplace invaluable for you and your people in the ever-evolving world:
Enhancing Workforce Agility
An internal talent marketplace is pivotal in creating an agile workforce.
It allows organizations to respond swiftly to market changes and maintain a competitive edge by leveraging people analytics and insights into workforce capabilities and interests.
This agility is essential in today's fast-paced business environment, where the ability to quickly redeploy talent to where it's most needed can differentiate a company from its competitors.
Promoting Skill Development and Career Growth
The development of new skills and the expansion of career opportunities are significant advantages of an internal talent marketplace.
With up to 58% of the workforce needing new skills post-pandemic and increasing demand for AI skills at work, the "rising demand for workforce AI skills," these platforms provide a structured way for employees to see and seize opportunities for advancement.
Remember, employees today seek varied and non-traditional career paths. By promoting lateral and cross-functional career moves, you're encouraging continuous learning and adaptability among the workforce—essential factors for personal growth and organizational resilience.
Boosting Employee Engagement and Retention
Internal talent marketplaces significantly enhance employee engagement and retention by fostering a culture that values and promotes internal mobility.
Employees in companies with robust internal mobility programs are likely to stay longer, feeling more engaged and valued.
This engagement is further enhanced by the psychological satisfaction employees gain from visible career paths and development opportunities within their current organizations.
Key Steps to Preparing for an Effective Internal Talent Marketplace
Assessing Organizational Readiness
Before developing an internal talent marketplace, it's crucial to evaluate your organization's current mobility practices, systems, and vision.
This assessment helps in identifying challenge areas and updating the mobility strategy as a precursor to any talent marketplace design or technology investment.
This way, you have a starting point to discuss with any vendor you're about to engage with and more likely to get more effective execution.
Questions to consider include:
- How well does your organization match talent to work?
- To what extent is your workforce encouraged to build skills outside their formal job responsibilities?
- What are your key barriers to internal mobility?
Cultural Shifts Required
Implementing an internal talent marketplace requires a significant shift in company culture.
This change involves redefining workforce engagement, career development, and the mobility journey across the enterprise.
Managers play a crucial role here, as in the implementation of any other policies and technologies.
They must be the first to break the old-school conceptions of traditional career development models that strictly follow organizational hierarchies and structures. They need to really understand the true benefits of this solution and spread the enthusiasm among their team members.
Effective communication and training are essential to ensure that managers and employees alike embrace this new approach to talent mobility.
Technology and Platform Considerations
When you've finished your strategic thinking, it's time to find a talent marketplace vendor to partner with.
What makes an ideal technology platform for your internal talent marketplace depends on many critical factors.
Large enterprises often require a custom solution to fit their business requirements. Yet, there are always ready-made options for teams of all sizes to start this journey.
The Bottom Line: Let's Future-Proof Your Workforce
The more the world of work changes, the more companies need to stay adaptive and resilient.
Don’t let your talent go to waste; allow them to grow their careers AND drive your business into its tomorrow. It's the ultimate way to build internal mobility, foster a progressive
workplace culture, and attract top talent to minimize your reliance on the hiring cycle.
Contact GoFIGR today to discover how we can help you foster a future-focused workforce using our internal talent marketplace platform.
Helena Turpin spent 20 years in talent and HR innovation where she solved people-related problems using data and technology. She left corporate life to create GoFIGR where she helps mid-sized organizations to develop and retain their people by connecting employee skills and aspirations to internal opportunities like projects, mentorship and learning.
