Four strategies to retain your best employees
How well are your talent retention strategies working for you at the moment? The latest US Bureau of Labor Statistics (BLS) report shows that American workers continue to quit at the highest rate since 2001. In addition, a Ladders survey of 50,000 workers earning more than $100,000 finds that 67% can see themselves quitting in the next six months. That's a full two thirds of your professional workforce who could see themselves (potentially) walking into your office and handing you a resignation letter in the next six months!
Given that the unemployment rate is at a 50-year low, there are more job choices than ever out there for both active and passive job seekers, and – as the statistics show – that results in a challenging environment for staff retention. Companies are having to work harder than ever to keep staff on board. So, if you haven’t done so already, now’s the time to review your talent management plans, particularly those aimed at retention of your best employees. A study by Leadership IQ shows that 46% of newly hired employees will fail within 18 months, and only 19% will achieve unequivocal success. So it stands to reason that prevention (of your best people leaving) is certainly better than cure (the recruitment and onboarding process) when it comes to hiring.
Here are four talent retention strategies to help you retain your best employees:
Understand employee motives
Use formal meetings like regular performance reviews and informal discussions as opportunities to really understand your employees’ motives. Ask probing questions like:
What they like about the company and their role at the moment, any aspects they might change, any internal frustrations they’ve experienced etc. This makes you aware of any negative ‘push’ factors that could prompt a decision to move – you can then aim to eliminate those, while reinforcing the good things.
What they want to achieve in their current role with your company, and where they want to be a few years from now, whether they are still at your company or not. Try to understand what each of your team is self-actualising for in their career.
Whether there have been any changes in their personal circumstances that have impacted on their work-related priorities. For example, if someone became a parent recently, is there anything you could do to adapt their role in relation to their new lifestyle?
Besides building the bond of a manager that truly cares about their wellbeing and career, you’re also gathering information to help the employee achieve what they want in order to be happy within your company (whether that’s in their current role, or moving to a different role or department). This line of questioning can seem counterintuitive, as managers worry about the answers they might hear, but it’s important not be selfish about your department or the role in this way. Instead, think about the wider interests of your company and your employee, and be prepared to plan and manage change – it’s much better than being forced to react to change if that employee suddenly leaves.
Pay someone more than market rate
Here’s another tactic some companies employ to retain their best staff, the A players making the biggest difference to the business: pay them a salary well above market rate, or at least much larger than normal bonuses. Besides making the employee feel valued for their above-average contribution, this approach can have inherent retention value – put bluntly, it makes it harder for such candidates to find another company that will pay them the same or better. As they are unknown and unproven to new potential employers, these candidates can be perceived as too expensive to even look at. This is the case with the larger companies in particular, where candidates need to fit into budgets as benchmarked by HR – such companies might not even interview ‘expensive’ candidates, irrespective of the intrinsic value someone might have as a top performer. We’ve seen this tactic work well in practice – the top performer stays at their current company longer because they’re happy and ‘hitting the ball out of the park’ for their current company, so they will only move for the right opportunity. But such opportunities become limited because of how much they are being paid.
Provide internal mobility
People with the longest fintech company tenures tend to have one thing in common: they’ve usually performed different roles, giving them fresh new challenges every few years (whether that’s a promotion or a sideways move). Not every company can provide this, but take every opportunity to explore the idea as part of your wider company talent management strategy. Take, for instance, a new business sales person – they might be your top performer, but if they feel they want a change you shouldn’t try to keep them in the role just because it’s the safest way of meeting your team sales targets (there’s a good chance that he or she could leave anyway!). The right role to move to will of course depend on the individual’s motives, but perhaps there is a business development strategy role the person could perform, a new market they could target, or an account management role they could move to. They key point is that by making the effort to understand the inner motives of your employees, you might be able to proactively offer them a new opportunity. Having them stay at the company saves you the risks of having to go external to hire for that opportunity, and leaves just one role needing back filling.
Ask your recruiter for talent retention ideas
It might sound counterintuitive, but great recruiters would prefer to see their clients retain their best talent, rather than lose their top performers. You see, a company that has an employee turnover rate that's higher than the industry average can easily find their reputation turns negative, which in turn can make it hard for them to attract top talent. The best industry recruiters love to stake their reputation on placing the best candidates at the best companies. So why not bring in your recruiter to ask their opinion on specific roles and profiles, and what best practices they’re seeing in the market? This is just one of the free value added services I provide for my clients.
If you’re at a financial technology, data or research firm that cares about retaining its best staff, and you would like to discuss these talent retention strategies (and hear a couple more that I’ll share with you), you’re welcome to book a free 30-minute talent strategy phone consultation with me.
About the author: Shawn Rutter is the founder of Excelsior Search, a market-leading, niche search company specialising in international executive search and recruitment solutions for financial technology (fintech), data and research providers to the global capital markets and investment industry. With experience delivering search assignments across the Americas, EMEA and APAC, he founded Excelsior Search in 1999, having previously worked as an Army Officer and for the international search firm MRI. Shawn invites you to connect on LinkedIn.