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Retaining Employees in a Revolving Door World – Part II posted on November 19, 2008

Attrition is expensive - retaining your top talent during times of upheaval will position your company to weather the storm.

In my multi-faceted role as a management consultant, I have the opportunity to view this current employee market from two very different viewpoints: working with organizations to maintain or improve business performance, and working with employees who are in a career transition. From both sides, I see a lot of people who are worried about the future, both personally and professionally. The organizational trend that I have recognized lately is the “bunker mentality”, which consists of doing everything possible to streamline costs and reduce vulnerability. While it is prudent for management to take a firm, proactive stand to maintain their business viability, the issue is with where an organization usually chooses to start the cutting and it is those things that impacts employees the most.

As mentioned in the Part 1 series of this topic, most organizations would contend that their employees are their greatest asset. They recognize that retaining their top talent ensures customer satisfaction, increases sales, and improves effectiveness by maintaining consistent organizational knowledge. But if they know this, why do they, in times of economic challenge, behave in ways that encourage their employees to start looking around? They seem to lose sight of the direct correlation between employee retention and bottom line results.

Employee retention is critical to the long term success of a business and, conversely, attrition is very expensive. Various estimates suggest that losing a key employee can cost an organization up to twice his or her annual salary. Add in the loss of productivity, the cost of a lengthy candidate search, and the insecurity of the remaining staff, and the actual cost goes through the roof.

Six Retention Strategies
Ignore them at your peril. A CEO from a technology company once said, “So what if they’re unhappy? Where are they going to go?” The comment was made in 1999 when the dot.com bubble had burst, the job market was tight and he felt secure in his cavalier management approach. Then came 2001 and tech companies began to recover and his engineers were heading en masse for greener pastures. Retention matters, especially in these trying times. Try implementing the strategies below to keep your assets producing and contributing for the long haul.

1. Put the right people in the right positions. Stop trying to put a square peg in a round hole. Consider the talents of your staff and ensure the job makes the best use of those talents. In every position there are a few things that just have to get done, but be sure the entire job isn’t just a list of dull “have-to’s” that don’t challenge the worker to bring their brains and creativity to work!

2. Not everyone should be a manager. People leave managers and supervisors more often than they leave a company or a job. And promoting someone to a management role based on longevity or technical talent does not mean they are equipped to lead people. So pay attention to who you have placed in those supervisory roles.

3. Set clear expectations, objectives and measurement criteria. If things change, revisit those objectives with your employee. As more and more organizations reengineer, merge, restructure and downsize, employees may feel that the rules keep changing in terms of what they're supposed to do. A satisfied employee knows what is expected of them – it gives them control over their own performance.

4. Remember W. Edwards Deming, the father of Total Quality Management. When an employee isn’t performing, ask yourself “What about the work system is causing the person to fail?” You, as the manager, might be the root of the problem. Often the employee knows exactly what they should be doing but they lack the time, tools, or training to get it done. You can give them a poor review but it doesn’t solve the problem.

5. Link individual performance to corporate goals. When people understand that their daily work product contributes to the bottom line, they feel a part of the greater whole. As a part of the annual objective setting ritual, be sure that the link to company performance is crystal clear. This goes a long way towards making an employee feel like a valued contributor.

6. Rewards and recognition are a must. And don’t make them cheesy – make sure they are rewards that someone would actually want to have. Awarding a parking space to the employee of the month when they don’t own a car indicates that you really don’t know them or care about their needs. Get creative – don’t wait for the regular corporate reward program. Give spot awards right at the time they mean the most to your employee – like when they just wrapped up a critical milestone, or when the going has been particularly tough due to reduced resources.

There are many more retention strategies that might be more applicable in your environment, but here are the core efforts that can save you time and money. And if you are concerned about your revolving door, be sure you conduct an exit interview with each employee that leaves, and then actually read them. You’ll likely find great answers there that will help to further identify your custom retention strategies.

Pattie Vargas, co-founder of the San Diego-based career transition services organization NextWork™, and CPO with CUSTOMatrix™, Inc, utilizes her vast experience in the executive/management/team development industry to help individuals identify their personal strengths to gain clarity on how to achieve career fulfillment and effective results. She is the author of Extreme Project Manager Makeover, practical tips for managers. For more information on the services that NextWork provides, call (760) 420-8444 or visit www.nextworkservices.com.