Talent advisors have in most cases failed to make senior executives fully aware of the extremely high ROI generated by a “wonder tool” that directly improves performance in multiple talent areas including productivity, retention, recruiting, motivation, as well as skill and leadership development.
This powerful talent approach is expedited internal movement and transfers between disparate and global business units. And even though external hiring gets most of the resources and publicity, research by Jobvite rated internal hires #1 in hire percentage (i.e., candidate quality) and #1 in source effectiveness. Similar research by SilkRoad found internal hires to be the #3 source in hiring volume. Yet despite this evidence of its impacts, at most firms, the internal movement /placement process (which includes transfers, promotions, workforce redeployment, and project/job rotations) unfortunately, operates under an extremely low priority.
A history of operating under the radar means that this internal movement process is almost always under-resourced, underappreciated and that it’s not effectively monitored or managed. After decades of research on expedited internal movement, I have found that this high-impact area receives such a low priority mostly because executives and managers aren’t fully aware of its many impacts and benefits.
So, if you’re ready to shift your priorities from external hiring to internal, you will need several convincing economic arguments to include in your business case. Fortunately, while advising a major European telecom, I recently had the opportunity to compile a comprehensive list of the many benefits that derive from expedited internal movement, which incidentally, includes raising employee skill levels, which surveyed CEO’s are concerned about with an amazing 80%.
The business case covering the many impacts from expedited internal movement
If you’re having difficulty getting funding or executive support for expediting internal movement, this article can provide you with multiple elements for your business case. You will find that expedited internal movement initiatives provide many advantages that fall within 5 broad categories (innovation, development, productivity, retention/recruiting, and motivation). If you expect more funding and executive attention, it’s important that HR first quantify in dollars, and then make both executives and line managers fully aware of each of these many benefits.
1. Measurable increase in the critical area of innovation
It’s clear that the top 4 most valuable firms in the world thrive because of their ability to serially innovate. Fortunately, project and short-term rotations increase innovation because they increase cross pollenization and collaboration between teams and business units. During a rotation, both teams learn about new innovations in place at each other’s teams. These innovative approaches can be easily captured and later applied to their own home team when they return. Plus seeing and learning about the other team’s innovation process will likely increase the innovation rate at your base team when the rotated individuals return and suggest modifications to their own innovation process. And of course, rotating your innovators will keep them excited, learning, and lower their probability of turnover.
2. Rotations provide a dramatic increase in learning and development
Internal research by Google discovered that most learning occurs on the job. (“It is far more productive to allow employees to develop through individual project work.”) It also found that learning ability was the #1 predictor of on-the-job success across all their jobs. In addition, increasing employee learning through rotations allows your employees to keep up with the rapidly changing world around them. The numerous ways that expedited short-term and project rotations can increase individual and team learning include:
- Shadowing allows an individual to add new skills rapidly – In today’s rapidly evolving business environment teams need to continually add new skills. Rather than classroom learning, employees in rotations learn skills by directly watching and shadowing other employees. Research by Google found that skills learned “by doing” are more likely to be remembered and passed on to other teammates.
- Rotations for development allows a team to keep-up with new knowledge – In addition to skills, existing knowledge also rapidly goes out of date. And that means that the teams with the best inter-team rotations continually update their knowledge base much faster. And the knowledge is likely to be gained in areas that are completely new to the base team.
- Rotations aid in leader development – With growth and high turnover, filling leadership positions becomes critical. Rotations into a short-term manager or team leadership roles can help an individual develop their leadership capabilities. The rotation can also serve as a leader assessment tool. And when you don’t have the resources to identify high potentials formally, rotations allow you to develop and assess many more team members. Incidentally, developing leadership replacements may also expedite a manager’s own promotion.
- Rotated employees experience data-driven decision-making – Because there is an undeniable shift toward the use of data supported decisions in both the people management and the technical elements of a team’s work. A top goal for most rotations should be employee exposure to the data-based decision-making that occurs in more advanced teams.
- Rotated employees learn about emerging technologies – Another critical goal of rotations should be to learn emerging technologies like AI. And how they can be applied to all areas within your base team. Many firms are now using reverse mentoring rotations, where junior techies are assigned to mentor less tech savvy executives.
- Short-term rotations can increase employee learning speed – Not only do job rotations increase what the rotated employee learns but the short-term nature of the rotation forces the individual to discover how to learn faster and in less formal ways. It’s also true that increasing an employee’s speed of learning and agility will help them throughout their career.
- An increase in employee interest in learning — because they occur in the actual work environment, as opposed to the classroom. Rotations are accepted by employees as being more relevant. As a result, they usually increase the employee’s personal interest in learning and development. Employees in a rotation see the immediate results of their learning, and they tend to develop a passion and an interest in additional learning. And the fact that the rotated individuals are learning puts competitive pressure on their more stationary teammates to also keep learning.
- Rotation assignments face less resistance than classroom training – And, finally, employees accept development opportunities faster when they don’t have to sit in a classroom.
3. Rotations result in a measurable increase in individual and team productivity
Short-term and project rotations have a measurable impact on both individual and team productivity. Some of the reasons that productivity increases include:
- Improved individual performance – The performance of the employee will increase after the rotation because of their added skills, knowledge, contacts and experience. Success in the rotation may also increase their confidence level and their desire to continually improve and move up.
- A team can rapidly add best and next practices – In a fast-changing world, teams need to continually add best practices and to develop “next practices” in completely new areas. Rather than starting from scratch, one of the most effective ways of adding an already operational best practice is by borrowing it from another team through a rotation. Because the best practice is already operational, adapting it to your team will likely be easier, cheaper and much faster.
- Rotations expand networks, which increase productivity – One of the primary benefits of rotations is that it allows employees to build in depth professional networks much faster. Larger employee networks allow for faster learning, and increased productivity and In fact, Google research found that employees “that are better networked… have better performance and higher promotion rates.”
- Rotating employees between inter-dependent teams can improve inter-team cooperation – When the business processes of two teams are interdependent, rotations allow individuals from both units to understand better and appreciate the perspective of others. Rotations can also help to break down functional silos and reduce information hoarding. A better understanding of each other’s needs and problems may also reduce future conflicts, which may indirectly help the customer.
- Rotations get often postponed work done – It’s important for individual managers to realize that by allowing an outside the team employee to help with your work, you get some important and what might have been delayed advanced work completed. And, even when the rotation assignment is taken by an internal team member, it is likely that in addition to their temporary assignment, they will continue to fully complete their current job.
- Asking “the why question” may result in streamlined business processes – One of the advantages of allowing rotations into your team is that new people continually ask, “the why question.” As a result of their direct questioning and probing, the team is more likely to re-examine and re-engineer its traditional approaches and processes. Incidentally, when your own team’s employee returns from a rotation; they are also more likely to ask the “why question” about your own team’s traditional practices and processes.
- Rotations have a higher ROI and more impact than traditional skill training – Research data makes it clear that on-the-job learning is more welcomed by employees, it occurs faster, and it is more likely “to stick.” So, the net result will likely be that the ROI and the actual impact of developing an employee on rotation will be much higher than an employee developed through the traditional training processes. Any loss in the number of hours devoted to their baseline job (when they are working on their rotation assignment) will likely be more than made up by the more effective development that will increase productivity when they return.
- The chances of losing a team member after a rotation can be minimized – When losing a team member is a concern, managers of the two teams can agree to offer reciprocal rotations, so there is no net loss of FTE to either manager. When necessary, team managers can agree that there can only be mutually agreed to employee transfers at the end of a short-term rotation assignment.
4. Rotations can dramatically improve retention and recruiting
Unfortunately, corporations are facing the highest employee turnover rate and the greatest shortage of skilled recruits in decades. So, an important benefit of short-term and project rotations is that they have a measurable impact on improving employee retention and recruiting.
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- Today’s employees expect more development opportunities – Various research studies have revealed that 68% of employees say training and development is the most important workplace policy and 91% of high performers rate learning opportunities as important. However, 39% of employees say they are never or rarely learning, and only 42% say they are frequently learning on the job. Obviously, if their development goals have not been met and employees feel that their exposure to the rest of the organization has been limited. Together these factors may lead to the departure of your most ambitious employees. Rotations also reduce frustration and add excitement, which will also help to reduce turnover. And, yes, after a rotation, some team members will have an increased desire to move on. But others will see that the grass isn’t greener, and they will be more likely to make a commitment to stay with their current team.
- Expanded development opportunities expedite career progression – In addition to developing employees so that they can do their current job better, rotations clearly speed up the career development of participating employees. The rotated employee is closer to leadership roles and promotions. And, seeing that their career progression is moving faster will help to reduce turnover. It is also important to note that rotations allow even non-participants to move up faster as they because rotated employees move up more quickly.
- Creating a development plan may by itself reduce turnover – Creating a formal personalized development plan for individuals that are “at risk of leaving” will help to show them that you have a plan for their future. Knowing that you are counting on them may by itself reduce their interest in leaving.
- Rotations help to prepare replacements – When key employees do leave, rotations can help reduce the pain associated with key employee turnover by helping to prepare and assess permanent replacements. Short-term rotations for designated backfill placements make it possible to prepare and assess a designated replacement in the case of a sudden unexpected departure within your team.
“Would you rather lose the person to a competitor or a colleague?” — Tom Stachura of IBM
- Development opportunities make it easier to attract talent – Top talent that you are recruiting is always interested in development opportunities. So, seeing that others have participated in development opportunities will make it easier to attract both outside talent and internal transfers to your team. And having employees talk up their development opportunities during candidate interviews will help a team sell “difficult to land” candidates.
- Rotations provide an accurate assessment of potential permanent internal transfers – when you are considering an employee for a transfer into your team. Giving them a short-term rotation assignment can be the most effective candidate assessment approach. In addition, if the employee is selected after their rotation, they are much more likely to be able to get up to speed quickly and to succeed in a permanent job. Incidentally, managers should realize that internal transfers are likely to expect much lower salaries than external hires.
5. Rotations result in a measurable increase in employee motivation
Short-term and project rotations can also increase employee excitement, engagement, and motivation, while the same time is reducing boredom. Benefits in these areas include:
- Development rotations are an inexpensive form of recognition – Most employees view being offered a development rotation as a form of recognition for their accomplishments and their loyalty. This means that a rotation can energize an employee with no compensation costs.
- Rotations can reduce boredom and stress – Even the best job can get boring after a while. So, providing workers with a variety of work can reduce boredom. And giving them a break from their regular job and routine may also reduce stress and increase productivity. A short-term rotation can offer them a change of pace as well as a learning opportunity. And after a short-term change, they are likely to come back much more excited and engaged.
- Developing mastery in one’s field is a major motivator – Firms like Salesforce have found that developing a mastery in one’s field is a major motivator for professionals. Mastery also expands their capabilities, which helps to increase an employee’s impact.
- Rotations motivate employees not to resist “extra work” – Because of the challenge, exposure and the increased skills that they receive. Employees complain less when they are assigned or encouraged to do the extra “beyond the job work” that is covered in a rotation.
And finally, individual managers need to realize that increasing employee development through rotations and project assignments may end up helping their own careers. First, by sharing their talent, managers can immediately impress other managers when they experience the tremendous capabilities of the talent that you share.
Next, sharing talent on a short-term basis can help build a manager’s own reputation as someone who unselfishly shares and supports other teams. Also making other managers aware that you excel at hiring and developing talent may increase their willingness to support your ideas in executive meetings and to cooperate with your team. In addition, obviously, executives are more likely to promote a manager who acts as a “talent launching pad” by encouraging the top talent they have developed to depart to other teams as soon as they are ready.
It is hard to find any area within talent management that can have a faster or larger business impact than improving short and long-term internal movement between disparate and global business units.