Here’s how to lead as a newcomer and keep people on your side. Read the full article by Samuel Bacharach on Inc.com.
Tag: retention
It’s easy to retain people. It’s not a big trick. Pay them fairly and well and they’ll hang around and do the work. HR specialists have mastered the skills of compensation. They can match your compensation structure to meet your organizational constraints, your organizational goals, the organizational personnel, and the resources the organization has available.
A rational economics approach to retention is straight forward. The problem is, at a certain point, a normative, psychological, approach may be even more important.
Sure, I can retain people with money, but that has a leveling effect. Retention through compensation does not guarantee commitment and personal investment. They’ll stay, but will they be committed and truly invested in your effort?
At a certain point, you’ve got to promise a bit more. Involvement, commitment, entrepreneurship, and risk taking requires not only an economic contract, but a social psychological contract.
That social psychological contract is created by leadership. Specifically, if you want to retain the entrepreneurs, the risk takers, the experts, and the great managers it will depend on your ability to lead. They will stay because they are recognized, engaged, challenged, developed, and optimistic.
You can retain zombies with money, but if you want to retain real organizational players, it’ll come down to the issue of your leadership.
Can you lead your team? Over and over again organizations debate the issue of retention by restructuring retention programs, playing around with the compensation systems, etc. But individuals do not necessarily stay because of the organization. They will stay for their team, they will stay for their team members, and they will stay for their team leaders.
Therefore the retention challenge is a team leadership challenge.
The better the leadership, especially at a group level, the greater the probability of retaining talent.
This is especially true in recent years. As the social contract between employees and their organization has broken down, it has been somewhat replaced by the personal, informal contract that emerges between employees, their teams, and their team leaders.
No longer is the sense of identity couched in the organization. Now it’s couched in teams. Employees speak of “my team” and “my group”; rarely do they speak of the organization with any sense of collective.
As such, team leadership training, which has always been an integral part in making organizations more innovative and creative, is also at the front line of talent retention.
Next time your boss gets mad at you, show him or her this chart.
According to the research presented–it takes an employer about $5,500 to replace one $8 dollar-an-hour employee. If you’re lucky enough to make more than $8 an hour–imagine what it would cost your company to replace you.
If I knew this a few years ago I would have been a far worse retail employee.
Anytime my manager would demand I that I put my cellphone away, I’d bring up the $5,500.
Anytime I’d be caught taking a long 15 minute break, I’d bring up the $5,500.
And if I happened to arrive late–I’d cough, $5,500.
I wonder how far that would have got me. Probably exactly where I am now. Sitting in an office, remincing about the good old days in retail where lunch breaks were one hour long, by law.
The graphic wants to warn small business and HR departments that firing and hiring aren’t cheap processes. Time and money goes into finding and training new people as well as making sure the person on the way out has all his paperwork in order.
But that’s obvious. However, seeing a dollar amount attached to the process makes the obvious startling.
The chart also revels something else, but not directly. It shows small buiness owners and HR departments the value of good leadership.
Good leaders create retention. People like good bosses that communicate goals, push movement, and create some space for creativivity. If people are happy, they tend to stick around.
Now we can look at the chart a different way.
Every talented leader creates value–$5,500 dollars or more of it–every time they rally a team together, get things done, and make people feel good about themselves.
Again, this might be obvious, but it’s helpful to see, in real dollars, how much money a good leader can save a company.
The notion of loyalty is central to the construct of the workplace. How much “loyalty” we exhibit towards our organizations and our superiors is often interpreted as an implicit measure of our character. Great leaders and dutiful subordinates are supposed to be with their men until the very end. Our society reveres the images of Captain Edward Smith going down with the Titanic or Leonidas fighting with his unit at Thermopylae in the face of imminent defeat. It is important to note that our societal narrative also praises those who cut bait and move on to bigger and better things.
The NBA season will draw to a close over the next two weeks. The free agency period will follow approximately two weeks later. The free agent class is headlined by Lebron James who many sports pundits consider to be the league’s best player and heir apparent to Michael Jordan. Lebron James, Akron native, drafted by his hometown Cleveland Cavilers in 2003 is faced with a choice between legacy and loyalty. Does he stay with his hometown Cavs, who have made every effort to bring in supporting players to help him win a championship, but now lack the salary cap flexibility to improve, or does he bolt to greener pastures of New York?
Winning a title in New York, along with the increased global media attention of playing round ball in the Big Apple, would net Lebron countless additional millions and allow him to achieve his stated desire to be a “global icon”. Sticking with the Cavaliers would afford Lebron the opportunity to finish what he started in his hometown and he would forever be included in the select company of athletes who played their entire careers for one team.
Leaders need to acknowledge that there is polarity present in each team member’s mind. One side is pushing the individual to pursue career advancement and individual prestige above the needs of the team. The other side stresses collaboration and group achievement above self interest. Hopefully, by acknowledging these considerations, we can create better working environments that increase productivity and more importantly reduce employee stress.
Picture Credit: Ryan Fung
Talented and creative workers have one unique joker in their deck. If they’re that good, no matter what the conditions are, they can find alternative jobs.
Who is it that we want to retain? It’s those people who have the option to leave–the people who have the option of exiting. Older workers oftentimes fall in this category. We don’t want them to retire because they have the cumulative knowledge, the capacity, and the skills necessary to make an organization succeed.
Shortly after 9/ll the NYC fire department, facing financial difficulties, offered an early retirement program. By solving one problem they created another. Early retirement was picked up by specific individuals who had critical knowledge and experience that was essential to moving the fire department away from its traditional structure to a model of a security-conscience agency. Similarly, in the last number of years organizations have been making similar moves. They are pushing for early retirement on one side while at the same time they desire to retain their best and their brightest.
Recently, my colleague Peter Bamberger and I received funding from Society for Human Resource Management (SHRM) to analyze how job and organizational factors affect individual retirement decisions among a national probability sample of 500 older workers.
These workers, initially contacted just before becoming eligible to receive retirement benefits, provided extensive data on the nature of their jobs, their employer’s HR policies and practices, and the extent to which they felt attached and connected with others at work. One year later, when these employees became eligible for retirement we contacted them again. Of the 500 surveyed, less than 50 people left the workforce.
As we continue to follow this sample of older workers, we are going to focus on what aspects of their jobs and overall work environment predict retention. We have to ask ourselves if there is a set of shared factors that inspire older workers to keep punching in.
Some of the qualitative data collected from these and other older workers suggests that social relations with coworkers and patterns of work-based social support play a pivotal role when retirement-eligible workers make the decision to throw in the towel or not. Organizational factors that we’ve seen from our qualitative work suggests that organizations that offer more “senior-friendly” benefits such as drug discount programs, wellness programs and elder-care programs, as well as career development programs geared for older workers are likely to experience high retention rates.
Given that older workers will comprise an increasingly larger portion of American and European labor forces in the coming years it’s crucial that we understand effective organizational factors that can help employers retain retirement-eligible employees.
Picture Credit: Flickr Commons
