The Cold War for Talent, researched and prepared by the Economist Intelligence Unit, paints a picture of a very different job market from a year ago, with organisations recruiting talent for key posts on one hand while making redundancies on the other. Pools of retrenched workers are being scoured for top talent and Benefits are being reworked to keep talented employees motivated and performing during a tough time.

Our research showed that 59% of respondents agree or strongly agree that the slowdown presents an opportunity to streamline their business through redundancy, while 36% said that in the next three years, redeploying talent will be an important strategy for their organisation in recruiting and retaining employees.

Several commentators have claimed that with the arrival of a global recession the ‘war for talent’ is over – however this new report has shown that the war for talent is not over, it has just changed, and now the ‘Cold War for Talent’ has begun.

Gone are the days of organisations blindly hiring the best people they could find from a small pool to keep fuelling growth. We are seeing an extreme correction back to classic people management where companies are nurturing and rewarding the best talent, releasing the non-performers and quietly hiring in strong talent to replace them. In fact, 42% of respondents agree or strongly agree that they expect their organisation to actively target employees made redundant elsewhere in their sector.

While 70% of business leaders surveyed said that, given the economic climate, their company’s talent management strategy was becoming more important, ownership of talent management differs significantly between organisations. 35% of respondents believed talent management is HR’s role, 24 per cent said the CEO was most responsible, 26% thought it was individual business unit heads’ responsibility and 8% thought it was line managers.

Business leaders agree that talent management is vital for their organisation but there is a mixed answer when asking where the responsibility lies among different organisations. HR should hold the responsibility of managing internal and external talent; identifying which employees to retain and nurture, which employees to remove and spearhead targeted hires of top talent to fill strategic roles which will drive business success in the recession.

HR directors need to show leadership at a time when there is confusion around talent management and they should be joined at the hip with CEOs. Under the guidance of HR, a company can extract huge value from its talent strategy, drive cost savings and optimise its workforce.

Having long fought criticism for not being ‘strategic enough’ or not being aligned to the business, the current economic climate gives HR Directors the opportunity to step up and truly demonstrate their value.

The report found that many organisations face stiff Challenges managing their workforce. 63% of respondents did not agree their organisation had a clear definition of what ‘talent management’ meant, while 38% said their organisation forecasted talent requirements poorly, and 32% said their organisation managed succession planning poorly.