The problem of finding yourself with a talented, high-potential employee who is a great fit for your organization — but a lousy fit for their current position — is not new. However, solving that problem without losing the employee to another company requires an entirely different approach from what worked in the past. Previous generations thought of careers from a different perspective. In the good old days, one would choose a career path that typically began at the bottom of a ladder whose top rungs were clearly visible from the lowest position. Over the years, the hope would be to move up the ladder until management positions were achieved; shortly thereafter, it was time to retire with a nice gold watch for your service. Workers tended to stick to suits and ties, and utter respect for authority was the norm.
In other words, to keep top talent on their rosters, employers relied on the status of their brand as an employer, loyalty, formality and a general tendency of workers to stay with one company for the duration of their careers. Today’s workforce has other ideas in mind.
What the Workforce Wants
The current unemployment rate in the United States is low and continuing to fall. On the other hand, top-performing and high-potential individuals are not nearly as impacted by unemployment rates and job scarcity as the rest of the crowd. That’s because top performance will always be in demand. However, even across all employees, the voluntary quit rate is higher than it’s been in nearly 20 years. In other words, today’s workers have plenty of jobs to choose from and they are voting with their feet when the employment experience falls short of their expectations.
While salary and benefits will always be a primary motivator for workers, those are also easily fixed by organizations dedicated to retaining the best and the brightest. The other motivators will take a bit more insight and examination into the culture of the workplace. According to Forbes, several factors make up the “perfect job” for modern job seekers. The first is flexibility: the rigid 9 to 5 structure is outdated. Next is a commitment to health and well-being, and that means employers addressing the humanity of their workers, not just offering free gym memberships in the benefits package. Lastly, and perhaps most importantly, is the desire to work with a purpose. People want fulfilling work. They want to contribute. They want to know what they mean to the organization and they want to feel recognized and appreciated.
To find lasting fulfillment at work, the environment must be agile. People have to feel supported and encouraged to take risks; failure must be an option, and it must be used constructively. Workers want real-time, genuine feedback, not a list of scores on an annual review. Career development is paramount; stagnation is grounds for moving on. The Harvard Business Review concurs with this assessment.
A Major Disconnect; A Hidden Opportunity
In a word, the problem starts and ends with skills. According to a survey by the Harvard Business School, business leaders are increasingly concerned with finding and hiring people who have the skills their companies need. What’s more, they’re also worried about what to do once those skills have become obsolete. On the other hand, workers who were surveyed seemed far more excited and positive: they were eager for opportunities to change and learn new skills to improve their own outcomes.
The survey dug even deeper and asked both workers and leaders to identify the impact of disruptive forces such as new technologies, demand for skills, changing employee expectations, and a continually evolving business environment. Over and over again, the survey found that it was the workers who seemed to have a better grasp of the fluctuating needs of being an employee, and they were not only more willing to be adaptive, but they were also more optimistic about what that meant for their future.
Perhaps this shouldn’t be all that surprising. If you look at what the workforce wants from an employer, their optimism seems to lie with the expectation that they will achieve this list of requirements by working hard to become valuable. They are looking forward to a long, challenging career with lots of twists and turns, plenty of surprises (read: not boring) and an endless opportunity to stretch and grow. In return, when these needs are met, these workers will be more committed and more engaged than the past generations who stuck around out of loyalty or habit. The future of any organization built around these eager, optimistic workers is very bright, indeed.
That is, if you can get them to stay.
The Consequences of the Missed Opportunity
First, the direct financial hit. Voluntary turnover is incredibly expensive for any organization, and according to one agency, it is comparatively worse for small and medium-sized businesses. Their experience working with SMBs showed a 30 percent voluntary turnover rate to be common. According to the Bureau of Labor and Statistics, turnover will cost about a third of the total compensation for that position. The Society for Human Resources Management puts that figure between 90 and 200 percent of the annual salary of that position! These costs include everything from HR staff time exiting the position and refilling it to production delays, lost clients, onboarding expenses and more.
There is a lot more to lose than just money, too. Organizations can lose a lot of institutional knowledge if they are not continually thinking about keeping their top performers engaged and growing. High turnover rates also lead to sluggish sales growth and low workforce morale. According to another report, these consequences hit small and mid-sized businesses the hardest as they are the least likely to have a deep bench to replace high-performers who leave the company, they have fewer resources to combat attrition and many are not even addressing the cause of these departures as they’re too caught up in the cycle of replacement.
How Your Company Can Succeed
If you want to attract and retain the top talent in your industry, a new approach to hiring and employee development is necessary. First, assessing for skills is quickly becoming irrelevant as what’s required for any job changes rapidly. Instead, employers should be looking for agility: someone who is curious and committed to learning, collaborative and thinks on a team-level, and has a high tolerance for change. Organizations should also be looking for problem-solvers, or people with a “can-do” attitude: someone who knows how to apply a lifetime of experience to problems they have likely never faced before. Appreciate diverse, creative thinking, imagination, courage, resilience when facing failure and natural leadership abilities. Most of these qualities have more to do with how the person approaches their work rather than any tangible skill. That’s because skills can be taught to the right person far more easily than talent can be swapped out as the demands of the position shift. The challenge becomes one of creating an atmosphere of continuous learning and growth rather than constantly trying to hire in the best skills.
There is another significant predicament for employers: people seem to be terrible at figuring out what they’re good at. As individuals, we are not always great at finding work that we can be passionate about, especially not at the time in our lives when these decisions often are made. For anyone more than a couple of decades into their career, remembering what inspired you as a high school graduate is probably impossible. Yet, this is when most people are driven to choose an education and career path — long before they have enough life experience to know what’s going to make them light up at 40 years old. The too-frequent result is bright, talented people who end up in the wrong place. Perhaps it’s been wrong all along; more commonly, they were in the right place at the start but have since outgrown or become bored with their positions. The onus falls to the organization to spot these high-performers and these high-potential individuals who are a great match for the company but are unhappy in their current role. The focus of these individuals must be to nurture and develop them rather than allowing them to be poached by another employer (and then relying on finding top talent incubated by another organization to fill the gap).
A culture of coaching is the natural conclusion to solving a multitude of turnover and retention problems facing employers. The entire development process must be transformed into one where the organization is committed — from the top down — to supporting employees as they learn new skills and grow to become more significant to the company. It involves regular feedback, not annual performance reviews, so employees can make changes and grow in real-time. It means offering opportunities and empowering people to take advantage of them. The culture must be one where the values include trust, respect, transparency, and accountability for the entire team. It also includes equipping those in management positions with the tools to serve as coaches who champion the successes of the individuals on their team as well as the group as a whole, rather than just keeping track of tasks and statistics.
Be Future Thinking
A significant change to any company’s culture is a major prospect, but the payoff is enormous. Coaching empowers people to work to their strengths and develop the skills necessary to be a true asset to the company. Organizations with a strong culture of career development have highly engaged workers, stronger revenue growth and significantly lower turnover than those that do not. Workers are stronger and more satisfied; organizations are more stable and drive more revenue. Everybody wins.
In short, when you have the right person in the wrong position, it’s time to discover what makes that person excited and find a way to get them into the right position through support and development, and then make sure the rest of the company culture hits the right notes to make them stay for the long haul.