How Things Have Changed
My mother went to work for a company in 1955 and retired, after 34 years, from the same organization. Just one office, one job, and one company for all those years. Now, granted, she wasn’t in the Factoring Industry and it was a large corporation, but she felt a strong sense of loyalty to them, through the good times and the bad.
Even to her last day, she supported her old company far more than I think she had any reason to. Regardless of my opinion, I cannot tell you how many times I heard her say, “They put food on our table for all of our lives, and we owe them a debt.” That kind of thinking is not the way the corporate world works for either employers or employees anymore.
Before mega-organizations with multiple branches, there was some loyalty from the company to their employees, however, it wasn’t long before many places became known as “churn & burn” organizations. They provided very good money and very good benefits, but you never knew when something would change, and you would be out on the street.
As the years have passed, our culture has evolved to one of very little loyalty in the workplace. Everyone knows how easy it is for a person to look at another field and think, ‘The grass is greener over there.’
So, the question inevitably becomes, how do you keep your best people from leaving your company?
As a recruiter, some of the first things I always ask are, ‘Why would you consider looking at another opportunity? What is happening in your current situation that makes you feel you would like to explore a change?’ The answers might surprise you. The main reason people start looking for other opportunities is not money. In fact, money is most often 3rd or 4th down the list of reasons people consider switching companies. I have found the main reason to be a lack of trust and/or respect.
Several years ago, there were two extremely high producers who left their positions and went to other companies for one simple reason, they had been promised something and it was never done. The company did not keep its word; therefore, the perception was that the company had lied and could not be trusted. One of two BDOs was #1 in the nation for his company; the other was in the top 5%. Both were secure in their abilities, so when they felt betrayed, they were gone. Each received a hefty counter-offered, by their old company. The sums were more than they would get by leaving; however, in both cases, they refused to even consider the counteroffer. This was because they did not trust their old company anymore. In addition, they felt that if they were worth the amount of the counteroffer, why were they not given it before they had found another position. Again, the trust and respect had been breached.
Opportunity for advancement/challenge is another big factor. When you hire someone who is relatively new to the industry, you give them an opportunity, you train them, and you provide them the tools they need to be successful. Naturally, they are given entry level compensation to begin with. As they grow to fill their role, it is essential that you provide them with a career path, along with opportunities to advance. If you take them for granted, as happens in more cases than not, you will lose them. It is easy to get in the mindset of ‘I made them what they are’ or ‘I taught them everything they know’. However, they are now a vital part of your team; regardless of who trained them, they became the employee you needed. Therefore, it only stands to reason that they deserve to be compensated with a career path and the opportunity to move forward, since they have a new value. Failure to do this will result in having to train someone new every few years.
The last reason we’re going to discuss for why employees seek other employment is Poor and/or Inconsistent Management. Especially in smaller organizations, the personality of the principals largely determines the working atmosphere. That is good in some situations, and in others it is not. If you are consistently losing good people, perhaps it is time to look inward to see if, in fact, it could be the management of the company. This is probably the hardest thing for any of us to change (our own way of doing things) but the definition of insanity is to continue doing the same thing over and over again while expecting different results. So, a retention plan should be one of the strategies of your company.
When You Do Lose Someone
If you lose someone, find out what led them to make their decision. At this point, it is probably too late to try and salvage that person. However, by taking a little extra time to find out why they are really leaving, it might save you thousands of dollars down the road by identifying a problem in your company, which can be corrected. Unless they are getting a 20% or more raise, don’t accept the “more money” line, because it is usually just not true. Changing jobs and companies is a traumatic experience for a person, and unless it is a great amount of money, this is probably not the whole story. Discover and correct the problem.
Another retention strategy is to spend time talking to your people; ask them what parts of their job they enjoy and what parts they dislike. This shows compassion for how they feel, and, with this information, you may be able to restructure positions to some extent. You could add more of their preferred duties and reassign some of the others. A happy employee is a more productive employee. Even if you cannot restructure the duties, by showing empathy you give their position value and they feel appreciated for the effort they are expending.
When you add up the tremendous costs of hiring: production lost from an unfilled role, the time it takes to interview, not finding the right person the first time, retraining, etc, the cost of retaining looks small. On top of it all, there may be a million dollars or more production difference between a good candidate and an excellent one. The new ways are not always the best ways. It is just smart business to stay close to your people, let them know you care about them and generate loyalties in them like my mother’s company did for 34 years.