You might think the recent economic turmoil makes it easier to retain your strong employees. After all, a lot of people are out there looking for work right now, and plenty have been laid off due to budget cuts. People with jobs should feel lucky. They should want to stay put. Right?
Wrong.
Current research from a variety of industry analysts has made one thing very clear about the relationship between the economy and the workplace: Your best employees are likely to leave for new opportunities as soon as they can.
Take a look at these sobering snapshots:
- The Focus Group, a UK-based management consulting firm, recently found that 60 percent of 950 executives polled will be looking to jump ship on the economic upturn, thus creating a major void in 450 organizations.
- 42 percent of respondents to a survey by recruitment consultants, Badenoch & Clark, stated they would be seeking new pastures in 2010.
- Towers Perrin’s recent Global Workforce Survey found that barely one fifth (21 percent) of employees are truly engaged in their work, in the sense they would ‘go the extra mile’ for their employer; likewise, only 38 percent believe that “senior management is sincerely interested in employee wellbeing,” while fewer than 4 in 10 agree that “senior management communicates openly and honestly.”
And although unemployment remains high and many people are actively looking for work, employers are actually facing a ‘people glut’ rather than a ‘talent glut.’ In reality, very few applicants today have the necessary skills to fill existing job openings.
So what does this all mean?
- First, your organization must seriously concentrate on retaining and developing the proven talent that it already has—because talent pools are small, and replacing employees is extremely expensive. A recent Talent Management report from IDC shows replacement costs conservatively reaching 150 percent of a departing employee’s annual compensation figure, while other estimates suggest that the cost is significantly higher (200 to 250 percent of annual compensation) for managerial and sales positions.
- Second, organizations must address the sense of alienation many employees feel in their current roles, so that they want to stay. In other words, they must engage employees better. If individuals are to remain loyal and motivated, they need to feel they are being listened to and that their growth aspirations and financial goals are within reach. Without actionable career development plans, dissatisfied staff will most certainly look for other opportunities.
At SumTotal, we believe companies need solid engagement strategies in order to hold on to their best assets. We also believe that enabling these strategies requires the unification of key HR systems and processes, namely around learning and performance management. By closely linking modules within performance and learning management systems and helping to combine otherwise isolated learning and performance tasks, businesses can boost productivity and reach goals faster and more effectively.
Unified systems can also:
- Help HR and management mine valuable data from performance reviews and ratings, and then translate that data into career roadmaps that employees can actually follow to bridge skills gaps.
- Help organizations ensure that they have the right people with the right skills in the right jobs.
- Enable the implementation of true succession plans to keep key positions filled with strong talent.
- Provide clear objectives to work towards, while recognizing achievement and showing employees how they are positively affecting the business by aligning their objectives with those of the organization itself.
