Shouldn’t it be hiring and inspiring, rather than hiring versus inspiring? If companies were in optimal conditions, then yes. But most companies are not optimizing their talent, and let’s clarify this upfront, it’s not HR’s fault.
In the current talent market, the two chief concerns among CEOs and business owners are attracting and retaining top talent. Talent acquisition and talent retention are not mutually exclusive. In fact, there is a symbiotic relationship between attracting top talent and retaining top talent. Think about it for a moment: If you make bad hires, they won’t stick around very long, but before they go they may demoralize your existing workforce causing some to seek greener pastures.
However, the converse isn’t necessarily true. Just because you hire a rock star doesn’t guarantee that they will improve your team’s chemistry or performance. So, let’s end the chicken-and-egg debate right now over which one you have to fix first: It’s talent retention.
Wait, what? I hear you out there: “Dave, you don’t get it, I can’t find any good candidates. I placed ads on the internet and no one qualified responds. I pay search firms and all I get are duds. There is a talent shortage out there…” Blah, blah, blah.
Not really. Where are all the rock stars? They are embedded in organizations and highly engaged in jobs where they love working on high-performing teams. They aren’t reading the job ads online and they aren’t responding to the recruiters who reach out to them because their needs are being met at work.
Let’s say you are able to attract a rock star and pay them more than your competitors. If you bring them into a sub-optimal environment, they will never perform like rock stars. They will disengage, and they won’t stick around very long. Therefore, you haven’t fixed anything. In fact, you’ve likely made things worse, because rock stars hang out with other rock stars, and in the day of Glassdoor and LinkedIn, word about your company and its culture gets around pretty quickly. Now you’ll have an even harder time attracting just mediocre talent in the future.
Ten years ago we were in the heart of the recession and it was very much an employer’s market. If you were an employee, you were lucky to have a job. And chances are, even if you were aware of that fact, you got reminded of it often. Times have changed. It is very much an employee’s market now. Yet, many companies still have practices and methods with the “you are lucky to work here” vibe.
Who is ultimately responsible for this? Well, as we stated earlier, it’s not HR’s fault. It would be unfair to dump all of this at the feet of HR. Especially, when many organizations (at their own peril, mind you) still do not even let HR sit at the table when it comes to designing business strategy.
Fix the managers
There is one statistic that has remained consistent for the past 25 years, from the days of the dotcom boom to the recession through today’s surging economy: One of the reasons someone leaves their job is their manager. There are millions of people commuting to work this morning to work for managers that suck. People don’t quit their job, they quit their boss.
Providing a competitive salary and benefits, Friday pizza lunches, and a coffee machine on every floor are no longer considered exemplary, they are expected. It’s about team chemistry, culture, engagement, and empowerment.
Yeah, yeah, we’ve heard this all before, right?
Let’s look at the bottom line. Most leaders tell us their most valuable asset is their people. People are also the largest expense for most businesses. Well, regardless of your business strategy and the results you are seeking to achieve, if people are your most valuable asset and your largest expense, then they are your most crucial investment.
Valuation expert, Dave Bookbinder, says it best in his book, The New ROI (Return on Individuals), “The value of a business is a function of how well the financial capital and intellectual capital are managed by the human capital. So, you better get the human capital part right.”
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Many companies have been able to get away with masking high turnover during the current economy where higher revenues have hidden many deficiencies. But as the economy levels off and profits grow leaner, if you can’t find any good candidates and your best people keep leaving, your business is in serious trouble.
Rock stars in the house
There are rock stars sitting on your bench right now, but chances are if they are not performing as such, their potential will never be developed and they will leave soon. And in this economy, they have options. They are not lucky to be working there. You are lucky to have them there right now.
OK, so now what?
Optimizing your talent protects against disengagement. Employee disengagement is a widespread issue that causes organizations to lose billions of dollars to poor productivity, absenteeism, safety issues, poor client service, and toxic workplace cultures. Gallup surveys tell us about two-thirds of US employees are disengaged.
Disengagement causes employees to withhold discretionary effort and to deliver the minimum amount of work to stay employed. Inevitably, when employees don’t give it their all, business results suffer.
There are many facets to talent optimization, but a good starting point for a company that is bleeding talent is to look at these four factors of disengagement:
- Misalignment with the job — Poorly defined positions, sloppy hiring processes, or evolving business needs create a mismatch between employees and their roles. Lack of job fit directly impacts motivation and productivity. We can combat this by using people data to understand the drives necessary for success in roles and match employees to those drives.
- Misalignment with the manager — The relationship between employees and their managers is the most critical contributor to engagement, yet many managers are poorly equipped or not trained to effectively understand their employees’ individual needs. They struggle to communicate with and motivate their employees. Companies have a responsibility to train managers to understand and leverage people data.
- Misalignment with the team — Team-based work is more critical than ever; yet poor communication, insufficient collaboration, and inability to manage the tensions inherent to teamwork continue to extract a massive tax on productivity and innovation. We can address this by using people data to understand whether behavioral drives are aligned to achieve the team’s goals and company initiatives.
- Misalignment with culture — To be productive and engaged, employees need to feel that they belong. When they feel out of tune with their organization’s values, or when they lose trust in their leadership, their own performance suffers, and they can create a toxic work environment that undermines productivity. We can fix this by using people data to consistently evaluate culture and prescribe solutions.
Talent optimization means always considering these four factors: job, manager, team, and culture. An optimized organization keeps these factors top of mind with every people decision and action, especially when looking to expand its workforce.
If you can fix your talent retention problem first and inspire your existing employees to achieve rock star results by addressing the four factors of disengagement, your talent acquisition problem not only becomes easier to solve, it also becomes less consequential.