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What is your company's track record in retaining valued employees?
Retaining Good Employees is the Key to Growth and Survival
Legendary Hollywood director Cecil B. DeMille was probably ahead of his time when he said: "The assets go home every night." DeMille's understanding of the value of human capital is now shared by enlightened organizations. These firms understand that to succeed in today's globally competitive marketplace, they must take positive, proactive steps to retain and motivate good employees.
Why it's so Hard to Keep Good Employees
Keeping good employees is probably more difficult today than ever before.
First, there is the economy. The US unemployment rate is at the lowest since World War II, around 3%. Skilled workers can typically choose from multiple offers, especially if they are willing to relocate.
Second, as anyone who has worked with a Generation X or Y employee knows, attitudes toward work have changed a lot in the last few years. The tide of corporate layoffs in the 80s and 90s sent a strong message to these younger workers. They know organizations will readily let them go if conditions require cutbacks. Younger workers are generally reluctant to make long-term commitments, particularly to a big company.
Finally, younger employees have different expectations of work and the workplace than older workers. Work is expected to be fulfilling, a place to grow and acquire new skills and make an impact. If these opportunities are not available, younger workers will leave, even for lower pay.
How Organizations can Improve Retention
Here are some strategies that have proven effective in retaining an all star employee lineup:
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- Start tracking turnover in your organization
Determine how it compares to your industry, size of your firm, and the local area in general. This will help you
assess the extent of the problem, if one exists.
- Don't assume turnover is primarily a compensation issue
There are often numerous other factors driving attrition such as management behavior, lack of development
opportunities, boring work, etc. While benchmarking pay rates and benefits is useful, it is not the whole answer.
- Use a cross functional committee to asses the problem
In larger firms, this process may turn up as many as 8-10 different reasons. Analyze these drivers thoroughly and
develop counter-actions.
- Implement management and employee training
These kinds of professionally administered programs can effectively address problems with poor management behavior and lack of opportunities for growth. In three recent cases, PDG's leadership and employee training programs reduced turnover within 6 months to below industry average levels.
- Deal effectively with "problem" managers who are "driving people out"
Whether you choose training, transfer or termination, your actions with these managers must be viewed as serious and as effective. Otherwise, your organization will seem impotent and employees with continue to leave.
- Develop a system to share risks and reward employees
Most progressive public companies now offer stock options to all of their employees. In firms where stock is not
a possibility, profit sharing, gain sharing, bonuses and cash awards can be used to reward individual and team performance.
Successful organizations view turnover as a reflection of the overall 'health' of their business and are always willing to examine its multiple causes and its potential impact.
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