Editor’s note: Focus groups have surfaced fears valued employees will leave as the economy improves. Two experts offer advice on how to maintain current workforce leaders.
According to economic experts, the economy is scheduled to slowly increase over the next four years. As this happens, the employment opportunities for talented people will increase.
The key question facing smaller businesses is: Will your key employees stay with small businesses as other opportunities become available to them?
Surveys by this newsletter’s parent, Information Strategies, Inc., and experts such as Susan Stetson of Salveson Stetson Group, many companies are seeing some turnover including key employees leaving for other promotional opportunities, especially if they are blocked in moving upwards or feel they are not valued or appreciated.
Thomas J. Walter, CEO of Tasty Catering. Elk Grove Village, II, economic growth has been stalled since 2009, and in general, employees realize that their costs are rising while their income is not. Employers with any modicum of sensitivity are aware of this devastation and understand senior staff that put off retirement as a result.
However, as the economy improves, more Boomers will give way to attrition and retire. In fact, 10,000 are applying for Social Security benefits every day. As the economy grows and attrition increases, the job market will switch from demand-controlled to supply-controlled in critical areas; it’s just a matter of time before organizations lose senior staff. Of this exodus, employers are aware.
There is a second exodus of which employers should be aware. Because senior staff is staying longer, it’s likely that the upward mobility of younger staff (potential—and current—key talent) has been prohibited, and thus their search for other opportunities begins when the economy shifts from demand-controlled to supply-controlled.
Walter offers these two key signs that an employee may be considering leaving.
- The first is a decrease in employee engagement and an increase in disengagement, which makes tracking employee engagement critical! Analyze and create action steps to remove disruptors causing disengagement, and know that if one unit tests low on engagement, it’s likely that unit’s leadership is responsible.
- The second sign is more subtle and is also regarding leadership. Organizational output is directly tied to company culture. If there is no focus on human capital, key employees are likely discontent—and not aligned through core values, vision and mission.
Here are Walter’s suggestions for what an employer can do to keep key talent.
- Emotionally engage your followers through leadership (not management) tools.
- Embrace the company culture, make it visible throughout the organization, and state it before every meeting.
- Recognize and reward the individuals who’ve earned it.
- Get the wrong people off the bus.
- Screen for skill; hire for attitude.
- Promote talent based on performance and adherence to the culture (not on seniority).
- Be financially transparent so that what employees “know” about company performance is actually the truth. Also, those who create the wealth should share in it to some extent.
- Integrate the generations.
Walter also suggests leaders should always watched, listened to and questioned. They are the primary topic of “shop talk.” How a small business leader treats followers will always be remembered. Are leaders focused on the privileges of leadership or the responsibilities of it? Do they treat your human capital as productivity units or as people? Do employees understand the altruistic purpose of why they do what they do, and do they feel loved and appreciated?
Walter points out, “none of us forget how we are treated by important leaders in our lives. It triggers emotional responses—positive or negative. Increasing perks, salaries and other such methods will not increase engagement or decrease turnover so much as positive leadership will.”
Stetson concurs with Walter and offers these warning signs:
- The employee has had multiple conversations with his/her boss to discuss future opportunities and there are limited options for him/her within the company.
- The employee is not as engaged or enthusiastic regarding his/her current challenges.
- Leaders are seeing changes in the employee’s patterns at work – including being absent more often, etc.
To keep key employees, Stetson suggests employers should have ongoing conversations with key employees about their interests. Most employees want positive recognition, which doesn’t necessarily mean compensation – time with the boss and praise in front of peers are examples of meaningful interactions.
Stetson argues while the key issues are spending time and paying attention to “stars,” including keeping them informed of where the business is going and what they can do to contribute, it is important for others to feel included and valued in order for them to be excited about remaining with an organization.
She indicates among the strategies companies are using include putting retention bonuses in place when they are concerned about key employees potentially leaving. They will also incent them with future prospects of other projects or opportunities with timelines of when they may be available.
But Stetson warns employees have sharp memories. If they were treated poorly in difficult times and felt underappreciated, it is hard for the employer to reverse those impressions.
Thomas J. Walter, CEO of Tasty Catering.is the co-author It’s My Company Too!
Sally Stetson is Co-Founder & Principal at Salveson Stetson Group.