Don’t panic — superstar employees aren’t ready to jump ship yet. But they are researching new career opportunities, increasing networking efforts and accepting calls from recruiters. They likely have been watching the job market for a while now.
Employers are wise to this shift in commitment and in the job market. More than one in two employers is convinced other companies are seeking to hire away their top people, according to a September survey from Right Management, the workforce consulting arm within ManpowerGroup.
In the face of losing talent, nearly half of more than 1,400 CEOs and human resource professionals from more than 700 companies who responded to the survey doubted the strength of their middle-level pipeline, and only 27 percent agreed their company has a sufficient number of qualified internal candidates to fill open senior manager/executive positions.
Employers have the opportunity to sustain top talent and build stronger internal talent pipelines in the next year, before they’re forced into counter offers.
Signs, Cost of Talent Flight Risk
There are telltale signs that a generally ambitious and highly engaged professional is becoming a flight risk or a person who may entertain a job change. They include:
• Agitation with high demands for travel and long work days; being “wired in” 24/7.
• Low energy and engagement, growing reluctance to accept new projects or assignments.
• Increased general frustration, shortness in replies.
• Visible dissatisfaction with bosses or senior management.
• Search/recruiter calls increasing, noticeable by the number of private calls.
• Taking time off at odd times or at the last minute.
Occasional or uncharacteristic signs like these may not indicate an immediate flight risk, but leaders need to pay attention when they become regular and pervasive. At that point, a strategic conversation with the employee about current challenges, desires, frustrations and goals can head off initial thoughts of a career move. Talent leaders shouldn’t ask if employees are planning to leave. They should focus on their current roles and generate ideas to make them better.
Besides the individual signs of flight risk, organizational shifts also can affect an already tenuous level of engagement among top talent. Organizations that have experienced two or more of the following situations during the last six to 12 months also should review the signs of flight risk among employees.
• Higher rate of undesired turnover in overall organization in 2011.
• Loss of key talent or job offers counter-offered.
• Financial results are lower than shareholder expectations.
• Change in company ownership, leadership, organizational structure or roles and responsibilities.
• Tight budgets and interesting projects or critical hiring held back.
• Key personnel still affected by minimal compensation increases.
Regardless of these signs and the continuing economic uncertainty, employers must assume their most talented people are mobile. Leaders should make engagement a critical, ongoing investment to ensure continued high performance and to avoid the costs associated with turnover. Ask employees how they are doing — and really listen to their answers. Make an effort to learn their aspirations and motivators, involve and challenge them in new ways and find ways to value and appreciate them.
Most employers understand the initial costs of losing and replacing a valuable employee, at least in the short term. In general, direct replacement costs of a departing employee can reach as high as 60 percent of that employee’s salary, according to the 2008 Society for Human Resource Management Foundation report “Retaining Talent.”
What organizations may fail to consider is the cost of lost organizational knowledge and technical expertise. Other employees may be unwilling or unable to take on the additional responsibilities of the exiting employee, and it may be more difficult than expected to replace talent quickly in highly skilled or leadership positions.
Other costs stem from failure to achieve organizational goals, interrupted strategy execution, loss of successor and leadership backup, loss of organizational knowledge and customer relationships, turnover and recruiting expenses, expense of leader time filling open positions, slowdown during transition, overload of other leaders who provide backup and floundering or disengaged work teams.
Assess, Communicate, Plan and Act
Responding to flight risk is not as simple as sitting down with employees and asking if they plan to leave — few will be honest. If the ultimate goal is to retain key talent, companies must first assess who those people are and then create a plan to promote the value of staying with the organization. Essentially, answer the employee’s biggest question: “What’s in it for me?”
High engagement is not solely dependent on competitive compensation. Few employees will leave a company to chase more money. Something else drives them to act. The Bailey Group, an executive coaching and consulting organization, measures employee engagement via nine drivers. Missing some or all drivers in an organization can result in employee engagement decline and increased flight risk. They are:
• Trust in leadership.
• Manager/supervisor relationship.
• Co-worker relationships.
• Job satisfaction/enjoyment.
• Connection to vision or clarity of purpose.
• Pride in organization.
• Development opportunities.
• Utilization of strengths.
• Discretionary effort or self-directed contributions to the organization.
To assess a talent pool for flight risk, list key roles that, if vacated, would cause serious concern. Focus the list according to critical business strategies, operations and processes, profit centers, key customer accounts and the top line. Identify the roles — and the individuals in the roles — associated with these areas.
The specific individuals who occupy these roles should be the targets of a strategic retention process. Carefully plan one-on-one meetings with these individuals to discuss their current state: what is working and what is not working, their goals and career aspirations, their frustrations and limitations regarding skills and strengths. Don’t be satisfied with one meeting per year — checking the performance review box. Instead, have monthly check-ins about what’s working and hold career discussions at least twice a year.
If leaders are hesitant or unwilling to broach this subject, consider hiring a consultant to conduct the interviews. A consultant also could coach leaders on how to conduct these conversations and engender trust and candor.
After gaining greater insights, talent leaders should develop a customized plan for engagement. This is where the rubber meets the road. Each plan should thoughtfully address areas of opportunity and concern and be goal-specific and action-oriented. While this plan isn’t distributed to the employee, leaders should examine any assumptions in the plan and ask: What am I really trying to achieve with this individual? Do we need a development plan that will prepare the individual not only for the next position, but will grow skills for a variety of positions in the organization? Does the individual need new challenges? How are we involving this person and valuing his or her input?
Application Supports Retention
Retention can be addressed through career conversations, development plans and interesting assignments. In other cases, employees value effective communication up and across the organization. They appreciate efforts to get teams working in harmony and with high functionality.
In 2010, senior management at MMIC Group — an organization that provides physicians, clinics and hospitals in the upper Midwest with medical professional liability insurance, risk management and IT consulting — sensed a disconnect between initiatives the CEO wanted to put forth and where leaders stood in their understanding of, and in their contributions to helping implement those initiatives. Leaders couldn’t identify specific conflicts or miscommunication, but the disconnect caused frustration and inefficiency.
Through facilitated senior management assessments, leaders learned about their strengths in relation to other leaders and discovered that senior leaders were not seeing themselves as responsible for the overall vision. Instead they were operating from a managerial or implementation standpoint. Customized and measurable coaching programs developed for the CEO and several senior leaders provided key organizational insights to strengthen each leader’s self-mastery, managerial mastery and skills. They learned to take ownership of the vision and keep the big picture in mind when communicating with their teams on day-to-day tasks.
Now, MMIC leaders are aware of the communication stumbling blocks that may have led them to disconnect with each other and with staff. Further, they have developed new methods of listening and communication that encourage contribution and feedback, which improves productivity and increases overall job satisfaction.
“We realized that the conflict wasn’t really conflict, it was the lack of dialogue,” said Bill McDonough, CEO and president of MMIC Group and MMIC Health IT. “If people disagreed or misunderstood, they kept it to themselves. We have learned as leaders to share issues and concerns and challenges. That’s made a big difference in our effectiveness and satisfaction.”
Complacency Won’t Work
Rather than resting on the false sense that employees will remain dedicated and loyal forever, remember the realities of today’s workforce. While the baby boomer generation looks toward retirement or a career that allows them to downshift, the youngest workers have a different set of needs on a shorter timeline in which to engage with an organization.
Increasing entrepreneurialism, opting out of traditional 9 to 5 careers and work-life challenges such as children and aging family members all contribute to an unpredictable talent pipeline. As Manpower states in its 2010 report, “Knowledge Retention and Transfer in the World of Work,” it is not only critical to engage and retain top talent, but also to establish processes to retain and transfer knowledge before employees move on.
Now more than ever, time spent on the organization’s strategic talent management — an ongoing eye to retention and a steadfast commitment to employee engagement — will serve organizations well. That is, if companies want their superstars to give 120 percent and not leave for seemingly greener pastures.
Jan Dick is an organizational development practice leader and consultant with The Bailey Group, Minneapolis. She can be reached at email@example.com.