Dear HR Executive:
The stock market's down this week but the economy is still cooking and we all know what that means -- tighter labor markets. We're not there yet, but I'm recalling 1999. Remember how tough it was back then to hire new people and retain the ones you had?
Retention may be the most important issue facing companies in the next 12 months. We conducted two surveys, asking HR execs at hundreds of companies 1) how high retention is on their priority list; and 2) How good a job they thought they were doing. You'll find their responses to both questions illuminating. Read on.
Stephen Meyer
B21 Publisher
Exclusive B21 Survey: Retention is a top priority, but most companies aren't on top of it
Two new surveys from Business 21 Publishing show that although HR executives feel employee retention is a hot-button issue these days, they're not at all confident that they're doing what it takes to retain their valued employees.
In the first survey, 78% said retention was at or near the top of their priority list. Only 5% said it wasn't. Here's the survey detail:
Where would you rank employee retention in your list of key HR challenges today (n=114):
- It's at the top. Nothing in more critical to our business in today's environment - 22%
- It's near near the top. We're paying lots of attention to it - 46%
- Somewhere in the middle - 25%
- Not a big priority for us right now - 5%
But our second survey suggests that only 20% of companies are taking proactive measures to ensure that their best people stick around. The details:
When it comes to employee retention, our company (n=114):
- Is totally on top of it. We have a solid plan for retaining our best - 20%
- Is taking measures, but I'm not confident it's enough - 42%
- Isn't doing much and I'm afraid some good people will leave - 25%
- Has no real plan at all - 11%
A few years ago Hay Group published an article called "The Retention Dilemma" that provided a great framework for developing a retention plan. The gist of it was that people stay at companies because they believe:
1. They're using their skills and abilities to the max. Make's sense, doesn't it? For any good employee, nothing could be more maddening than having skills that aren't being tapped by your company. Smart companies find out what people are good at and give them a chance to MAKE A DIFFERENCE. Bottom line: that's what people want to do. If your employees don't feel they can deploy their talents to improve the success of your company, they'll leave.
2. They believe in top management. Mediocre performers probably don't care much about how good management is. But good performers lose all faith in their company when it tolerates lousy managers. And when they lose faith, they leave immediately. Action step: Find out if you have weak links on your management team and replace them immediately.
As usual, higher pay was near the bottom of the list of things that make people stay in their jobs.
Click here to to read the entire Hay Group article on employee retention.
I think that far too many businesses ignore or downplay the importance of employee retention. Training new employees slows down production, monopolizes resources and manpower, and is often wasted when employees look for "greener pastures" once trained!
Posted by: thebizofknowledge | September 09, 2006 at 05:20 PM