Home / HR Director’s Hub / Retaining the Best: The market, not your company will determine the movement of your employees
image86

Retaining the Best: The market, not your company will determine the movement of your employees

Speaking to Joseph Daniel McCool of BusinessWeek.com, Marc Effron, NTMN founder says: “Business leaders in every industry are really drilling down inside the enterprise looking for cracks in process, systems, and resources that are hurting performance. As they do, they’re seeing the talent gaps and the potential for more effectively managing and building their key talent.”

Key to maximizing effectiveness is streamlining the processes, according to Effron.

“Business leaders want the simplest way to get the job done,” he says. “They need to push talent leaders to bring them simpler practices that address what the business truly needs, without the bells and whistles and HR bureaucracy we may add on.”

Peter Cappelli, the George W. Taylor Professor of Management Studies at the Wharton School in Philadelphia and director of Wharton’s Center for Human Resources and author of The New Deal at Work: Managing the Market-Driven Workforce, contests that when it comes to retention you first have to accept the new reality: the market, not your company, will ultimately determine the movement of your employees.

Professor Cappelli, says: “Yes, you can make your organization as pleasant and rewarding a place to work in as possible—you can fix problems that may push people toward the exits. But you can’t counter the pull of the market; you can’t shield your people from attractive opportunities and aggressive recruiters. Executives tend to judge themselves on their ability to instill loyalty in their people, and the departure of a talented employee can feel like a personal affront.”

In trying to stop people from leaving, many companies have fallen back on traditional retention programs.

“The old goal of HR management—to minimize overall employee turnover—needs to be replaced by a new goal: to influence who leaves and when. If managing employee retention in the past was akin to tending a dam that keeps a reservoir in place, today it is more like managing a river. The object is not to prevent water from flowing out but to control its direction and its speed.” Professor Cappelli, says

Prudential has been a pioneer in adopting this market-driven perspective. Its “Building Management Capability” program, which integrates recruiting, retention, and training efforts, is geared toward an increasingly mobile workforce.

“Gone is the notion that employees are going to stay with one company for life,” says Kurt Metzger, a human resources executive at the company. The Prudential program is anchored by a sophisticated planning model that projects talent requirements and attrition rates. The model enables business-unit managers to develop highly targeted retention programs and create cost-effective contingency plans for filling potential gaps in skills. The model also provides a mechanism for constantly measuring the impact of human resources decisions, a capability crucial to managing people in this rapidly shifting labor market.

Prudential has begun doing what most companies avoid: making a truly honest assessment of how long the organization would like employees to stay on board. Such an analysis inevitably reveals that different groups of employees warrant very different retention efforts.

Professor Cappelli, says: “Once you know which employees you need to retain and for how long, you can use a number of mechanisms to encourage them to stay. The key is to resist the temptation to use the mechanisms across the board. Tailor your programs to your retention requirements for various employees and to the level of demand for them in the marketplace.”

Speaking to Joseph Daniel McCool, Bill George, a Harvard Business School professor and author of True North and the 7 Lessons for Leading in Crisis offers his own advice about getting executive talent management right.

To keep your top business leaders onboard, George says you have to challenge them. “Put them in tough jobs. Make them responsible for something. Promote young people; flatten the organization; and give people opportunities to lead right now and they’ll stay with you and be true to you.”

Companies, he believes, must reward business leaders for their performance and not simply reward their decision to stay with the company. Companies must institutionalize equally ambitious and, in some cases, truly innovative and disruptive plans and processes to attract, develop, assess, and retain talent.

According to Jim Harris: “The missing link in today’s search to find and keep great employees is to align staffing and retention activities to the company’s core culture. Aligned companies break out of the cycle of disconnection and find and keep top-notch employees through a laser-like focus on their core culture. They recognize that they need to build a strong, stable, and lasting consciousness of connection for both prospective and current employees. Aligning their staffing and retention processes to core culture is their preferred method of driving long-term organization success.”

Claudio Fernández-Aráoz of Egon Zehnder International, author of Great People Decisions, says that companies need to beef up their ability to attract great leaders.

Joseph Daniel McCool, sums it up: While over the long run companies should focus on becoming more attractive by developing the type of culture, environment, and team that outstanding executives want to join, they also need to focus on winning the coming fight for executive talent one leader at a time.

Leigh Branham of the Canadian Management Centre, puts the spotlight on the problem by saying: “The problem is lots of CEOs say they want their companies to be great employers, but do nothing to hold managers accountable for treating people right.”

And go on to say that trust is one employee retention strategy that works for all organizations, and there are two key truths for anyone currently strategizing about how to make your organization a better place to work:

  • People join companies, but they leave managers so put the emphasis on long-term intangibles, lie creating a positive management culture, rigorous and innovative selection and hiring, holding managers accountable for managing people well, and training those managers in the people skills that engage and retain employees
  • The great workplaces don’t try cut and paste other companies practices because those practices may not reinforce their own work force and business strategies, which tend to mirror one another. Instead, they build on whats already special about their organizations.

About Dr. Ev D'aMigo; PhD

Check Also

Employment rate

UK Employment Rate Soars to 74.2%!

According to the Office of National Statistics (ONS), the 1st quarter of 2016 showed that …