Few of us really want to work for someone else. Many would rather have the freedom, independence, and potential earning power of the self-employed.
But for reasons of confidence, skill, companionship, security, and convention we work for others. When times are good and jobs are plentiful, we are easily enticed to greener grass. And when times are not-so-good, we hunker down and hope we can stay until those better times return.
Therefore, keeping people with skills, experience, and proven track records is never easy. With strong economies all around the world, high demand for skilled and experienced people, and with a shrinking pool of workers, it has become harder than any time I can remember to keep these good people.
Employment is a relationship. Specifically, it is a relationship between an individual with changing needs, increasing experience, growing knowledge, and intellectual capital.
Historically, the labor market has been a buyers’ market and the employee had to work hard to prove his or her worth and to build and maintain a satisfactory relationship with the employer. The successful employees (i.e., the ones who did not get laid off or fired) found a way to maintain harmony between themselves, their managers, and their work.
Now in this sellers’ market, the employer has to take the lead in building and maintaining the relationship. Employers have a huge responsibility to their stakeholders to do everything they can to keep the best people.
First, they have to identify their best employees, talk to them often to keep them informed, help them maintain and develop skills, and encourage them to build internal and external networks and relationships. The employer now has the responsibility of finding and keeping the balance between productive-yet-engaged and content-yet-challenged employees.
These are hard, new skills for employers. Communicating, engaging, and challenging people does not cost much when compared to the cost of recruiting and developing new employees.
Here are those four requirements for building harmonious and lasting employee-employer relationships:
- Practice tough love. Have a performance management system that works. Let employees know where they stand and how they are performing. Offer the opportunity to move within the company to jobs that may fit their skills and interests better. And keep the bureaucracy to a minimum and remove time constrictions. A major reason for employee unease and anger is insecurity over how their performance will be assessed. Many employees have goals and objectives that are not strategic and that lead to fear and self-doubt. For example, a colleague told me about a recent layoff she was part of. While the employee who was being let go had an excellent performance rating, so did almost every other employee in the organization. The way performance was assessed provided no meaningful information to either the organization or the individual. Performance criteria have to be clear, quantitative, and meaningful. They also have to have consequences and rewards. No other system will work.
- Open up and be transparent in every area. Silence and secrets are the greatest enemies of retention. When management does not update the employees on the financial and business state of the company and when rumors can be counted by the minute, turnover goes up and productivity goes down. While some people (usually the “B” and “C” players) hunker down and hide, the best ones start looking. I can?t tell you how many excellent employees who are highly valued have left their employers because of business uncertainty, lack of open communication, and a sense that management was keeping secrets from them. No one expects assurances or guarantees; what they hope for is an understanding of trends and issues. For example, are things better, the same, or worse? Are customers leaving? How is sales volume? Relationships thrive on the exchange of information. Employees should also be expected to bring problems to management and there needs to be a way to share their ideas and thoughts about improvements or changes. The two-way communication between employer and employees is as critical as performance management.
- Provide skills and opportunity. Education and development are the cheapest retention tools in your arsenal. We are in a talent war and we need bold experiments to find the best ways to unlock the potential of our employees. Getting people into degree or certificate programs is almost a guarantee that they will remain with your firm until they complete the program. Most will be loyal and thankful. And all will be better-educated and hopefully more productive employees. This is a BIG plus for the large organizations and you should be capitalizing on this right now. But development can also occur through on-the-job development, rotations, and informal networks and conversations. Every employer should encourage employees to transfer to different positions frequently, as well as put in rewards for managers who let their people go and who try and develop their staff. Many employees who leave organizations are simply looking for a bigger challenge or the opportunity to use new skills or degrees. Smart organizations will encourage this and motivate managers to source and hire internally whenever possible, even if it will require a bit of training.
- Help every employee build a social network. Employees are frequently devoted to fellow employees and feel strong attachments to them. This is what keeps many people from job-hopping. We all know how powerful networks are, and companies that actively promote employee interaction and teamwork have less discontent and less turnover than those that keep employees apart or at odds. Start clubs and social groups within the company so that people can work and play together. Some companies form college clubs for new college grads that help them become oriented to the firm and meet other new hires. This tends to raise the level of commitment they have to the organization and reduces turnover. Internal networks are powerful binding devices. Encouraging internal blogging, the use of virtual communications tools like SMS or IM, and the use of video conferencing can strengthen networks and extend them globally.
Knowledge is a powerful retention tool, so combat naivety and ignorance by sharing ideas and experiences between people from many different firms.
Employee retention is about applying the Golden Rule: do to the employees what you want done to yourself. It is about creating harmony and reducing discord. It is 90% common sense.