Does Employee Retention Matter Anymore?Do you know what’s worse than losing your best employees?
Keeping your worst.
Even amidst the current recession with unemployment numbers among the highest they’ve been in my life time top talent is hard to come by, especially if you have the newer skill sets and experience needed by socially connected corporations.
And when the recession finally does come to an end, years from now (5 to be exact), things won’t be any better. Baby Boomers who were forced to put off retirement will finally retire (although not in the way we traditionally think of it). Millenials won’t have the experience to fully fill the gap left by Boomers and there aren’t enough of Gen X to fill the gap. Technology and outsourcing won’t fill the gap either, if anything I predict they will make the need worse, creating an even greater skills gap.
So with all of that you would think that employee retention would be one of the most crucial goals for companies but I think this is misguided. Why? Because, no matter what you do, most of your top talent will eventually leave. Especially those stop gap employees that are part of Gen X.
It’s nothing personal, Gen X, as a whole, is just incapable of forming the loyalties that generations before us had. Even Millenials are showing signs of a renewed loyalty.
With that in mind is there a better way to think about employee retention? I think so.
Instead of focusing on retention I think companies need to think about a greater level of value creation by focusing on creating Knowledge, Networks and New Opportunities.
Create Knowledge:
For the time that you have that top tier talent you need to focus on creating and capturing knowledge. One of the most valued assets that an outside hire brings with them is a fresh perspective and an influx of new ideas. Use those fertile years to create as many new solutions, products and programs as possible. You’ll have time to vet and execute on those ideas even if the person leaves before seeing them through.
But if you fail to capture those ideas and document them well you not only wasted all of that time and resources you spent to bring them on there’s an even greater opportunity loss. Who knows what gems you could have pulled from their heads.
This isn’t as daunting of a task as it used to be. The rise of collaboration software makes this virtually drop dead simple. Even if it falls outside of the realm of their job description idea creation and collaboration doesn’t have to be a full time job. In fact I would argue that the best new ideas come from new people exposed to business challenges they face in the job you hired them for.
Create Networks:
If you’ve ever worked for a big company you’re probably familiar with the concept of employee alumni networks. Some companies already do this very well. Many large companies do this for retired employees but haven’t tapped into alumni networks for those who left for a myriad of other reasons.
It amazes me that companies don’t actively build alumni networks for employees that quit to take other jobs. If I were in charge of a companies HR department I would build plans of how to transition employees into an alumni network from the moment I hired them.
Social networking sites like LinkedIn and Facebook make it super easy for employees, current and former, to create employee networks but I’ve found that employers often aren’t driving the creation of these networks.
Just because you leave a company doesn’t mean you aren’t still loyal. I am still very loyal to HP products even after leaving. All my printers and computers at home are HP. I have even refused to upgrade my work laptop because I don’t want to give up my HP for the new Dell’s.
With the rise of job hopping has come the Boomerang Employee. It was an inside joke while I was at HP that if you wanted to get promoted it was easier to leave and then get rehired at a higher level. I would argue this is more the result of top talent being in demand than any bias towards outside hires.
Create New Opportunities:
3 out of 5 Gen Xers have said that someday they want to work for themselves. I believe this is less to do with the need for true business ownership than it is a sense of control over their own destiny.
Back in the Bill and Dave days of HP the companies founders were famous for enticing top talent with entrepreneurial ambitions by telling them they could come and work for them out of college while they gained some valuable experience and fleshed their own business ideas. In fact one notable thing about getting hired by HP was the lack of an employee NDA. Most tech companies make you sign an NDA stating that any idea you have while in their employ, regardless of whether it has anything to do with your job or not, belongs to them. HP has never taken this stance. Is it any surprise that almost every silicon valley tech giant has deep HP roots, including Cisco, Oracle, Apple and many others?
Another great way to create opportunities is to help place your employees with your partners and customers. Agencies are notorious for this. While some of it is just the consequence of talented people working closely with companies on a daily basis, I know of many CEO’s that have actively encouraged their employees to go after executive level jobs with their clients.
This is brilliant really. All agencies are built like a pyramid. There can only be so many people at the top. Not all your VP’s will become SVP’s and fewer still will be Presidents and obviously there’s only room for one CEO. Helping your top employees find executive positions helps them out while placing a loyal partner in a key client position.
The final new opportunity creation area I’ll call out is expansion. Global expansion or business diversification helps expand the pie, keeps key talent challenged and engaged and gives them that sense of ownership.
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