The competition for future-ready talent is escalating amid the increasing integration of AI and data science. Emerging skills and resulting gaps underscore the need for organisations to adopt a highly flexible and adaptable approach to growth and development. “Most organisations will need to adopt a mix of various strategies to address today’s skills challenges,” says Ryan Hill, Director, Advisory, Gartner. “HR leaders need to select flexible strategies that enable the organisation to pivot quickly and fill gaps likely to occur as conditions change — including an exodus of skilled talent. Some talent strategies also work better than others in meeting the needs specific to a recovering economy.”“Business ecosystems change constantly. Opportunities come and go quickly. The race is won by those most agile and swift. To compete and grow, companies worldwide must regularly expand or reinvent their resources” Build, Borrow or Buy | Solving the Growth Dilemma (build-borrow-buy.com) The way to achieve this? A multifaceted, strategic approach that considers current and future states, intellectual capital, industry trends and the intersection where your organisation sits.
Challenges with Traditional Growth Strategies
While Buy, Borrow and Build can be looked at separately in the reasons for their application, they must be used in conjunction as an organisational capability to achieve lasting, sustainable growth.
“The problem is, most firms’ strategies emphasise just one type of growth–for example, some focus on organic growth, others on M&A. When these strategies falter, the common response is simply to try harder. Instead, firms need to find the pathway that is right for them” – INSEAD’s Laurence Capron and coauthor Will Mitchell, of Duke University’s Fuqua School of Business and the Rotman School of Management at the University of Toronto.
Implementation is not the end
The aim to grow faster with the least amount of disruption requires a constant finger on the pulse. Implementation is not the end. Continuous monitoring, reporting and evaluation are all highly essential to keep on track in a climate that is constantly evolving. This iterative process ensures that your organisational capability remains aligned with business goals and flexible to changing circumstances.
What is the Buy Borrow Build Framework?
The ‘Build, Borrow or Buy’ framework creates a holistic guide for talent management, ensuring alignment with the current state and future needs. The framework was developed by Laurence Capron and Will Mitchell. Build, Borrow or Buy | Solving the Growth Dilemma (build-borrow-buy.com) serves as a guiding light for business growth in a rapidly changing talent landscape.
Evaluating Buy Borrow Build Strategies
Buy
Buying involves acquiring external assets, whether that be human capital, infrastructure, or IP. This strategy will often occur through mergers, acquisitions, or outright purchases of other companies.
Questions to consider may be: Does acquisition of assets through acquisition or merger align with our strategic goals and provide the most efficient path to fill gaps in comparison to organic growth?
Advantages: Providing a shortcut to entering new markets, industries or products, this pathway allows organisations to quickly gain access to established resources.
Considerations: The integration process after a purchase can be complex, requiring careful planning and execution. Challenges involving cultural resilience and integrity may also arise, especially in the current climate of change fatigue.
Build
Build involves investing in and developing internal resources. As the alternative to other external sourcing strategies,this may include uncovering latent talent pools within your organisation, mapping workforce capabilities and developing them to align with predicted skills gaps, talent acquisition or R&D.
Questions to consider might be: Have you invested in a comprehensive view of the future-capability of your workforce? Future capabilities outlast rapid skills obsolescence and underpin worker’s ability for rapid skills adoption. When it comes to organisational development, how important is it that you own the pathways for growth?
Advantages: Building from within provides businesses with control over their growth trajectory, fostering a unique and tailored approach. It allows for the cultivation of a distinct organisational culture and identity.
Considerations:Building may require significant time, learning architecture and resources. The pace of growth might be slower compared to buying or borrowing, and success depends on the organisation’s ability to innovate and adapt, as well as the leveraging of learning ecosystem partnerships
Borrow
Borrow involves collaboration with other organisations to gain access to shared resources. While companies maintain strategic independence, they are open to sharing intellectual capital. This talent model takes a collaborate over compete approach and may involve the use of Gig Executive or Gig Consultant talent, the proactive use of secondments between organisations, and partnerships between business, academia, government bodies and startup communities.
Questions to consider might be:Could you obtain the targeted resources via relationships? Is there an organisation better placed than you to develop your product? How can we create a win-win situation?
Advantages: Borrowing enables companies to tap into external capabilities without the full commitment and complexities associated with acquisitions. It allows for flexibility and can be a cost-effective way to access expertise.
Considerations: Successful collaboration demands strong communication, aligned objectives, and mutual trust. The risk of dependency on external partners also needs to be managed.
How To Decide Which Strategy (Or Mix of Strategies) is Right for You
Building and scaling internal resources can inject new life into the organisation through innovation and intellectual capital. Conversely, internal upskilling takes time and commitment – two aspects which may mean time-based opportunities are missed.
“Reliance on only one dominant mode leads firms to believe that their success depends on working hard at implementing that one mode” Build, Borrow, or Buy: Solving the Growth Dilemma by Laurence Capron, Will Mitchell. It’s clear that skills and resource gaps cannot be covered by any one strategy. But what is the best approach? Or the right mix?
Gartner employs a 5-step strategy to figure out the right mix of approaches to strategic workforce planning.
Gartner’s 5-step approach to strategic workforce planning
Step 1: Define the critical skills needed.
Step 2: Analyse workforce for critical skills.
Step 3: Prioritise chosen strategies – Buy, Build or Borrow.
Step 4: Combine for the right mix.
Step 5: Guide business leaders.
Solving the Growth Dilemma
The stakes are high when it comes to addressing the resource needs of an organisation, the nuances of how this framework applies to each organisation are many and varied, therefore time must be taken to map out the current and future states of your needs. Strategic planning that integrates both employed and contingent talent can lead organisations towards long-term optimisation of cost, flexibility, and effectiveness.
“Business ecosystems change constantly. Opportunities come and go quickly. The race is won by those most agile and swift. To compete and grow, companies worldwide must regularly expand or reinvent their resources” Build, Borrow or Buy | Solving the Growth Dilemma (build-borrow-buy.com)
The way to achieve this? Future Leadership is a comprehensive talent solutions ecosystem, providing executive search, leadership development and coaching, workforce planning and transition, and access to on demand talent. Our team works together to syncronise a multifaceted, strategic approach that considers current and future states, intellectual capital, industry trends and the intersection where your organisation sits.
By embracing flexibility, agility, and a forward-thinking mindset, organisations can navigate the complexities of growth and business development, ensuring readiness to strike at the right time in seizing opportunities and overcoming new challenges in an exciting and ever-changing organisation ecosystem.
Book a consultation on the buy borrow build strategy for you
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