At a time when employees hold the balance of power, there is an almost instinctive desire by HRDs to want to keep people, especially their top executive teams – those that have the most experience and knowledge. But should this be the case? Dr. David Lenihan CEO of Ponce Health Sciences University thinks otherwise. TLNT spoke to him to find out his views:
Q: Organizations are obsessed with executive retention – surely this is no bad thing, isn’t it?
A: It’s certainly the case that one of the biggest fears of businesses is the possibility their top employees will leave for jobs at other organizations. And in an effort to mitigate turnover, organizations are turning to predictive analytics, to infer their employees’ openness to outside job opportunities and the likelihood of exiting. But once they finally do go however, I’ve seen many managers become outraged that members of their executive teams have the audacity to move on. As work advice columnist Alison Green said in New York Magazine, “a ton of managers take resignations bizarrely personally — acting as if the person leaving has dealt them, and the organization, a callous and devastating blow.” Rather than being fearful or vindictive when trying to prevent executive departures, I believe that a more broadminded approach can be pursued.
Q: So what is your solution?
A: Counter to what many might think, I’ve found that the best way to support the key staffers in the companies that I’ve led is to make them as employable as possible elsewhere. If you’re offended if an employee decides to leave, my response is that you’re probably doing something wrong as a manager. But if using a turnover propensity index sounds like a neat idea (and perhaps quite soon, a convenient app) to avert workforce departures, your paranoid insecurity indicates that you’re most definitely doing something wrong as a manager.
Q: Are you saying ‘let’ people quit?
A: What I’m saying is that we – as employers – should do whatever we can to maximize people’s satisfaction, growth, and productivity. Then, when they’re ready to exit, we should celebrate their decisions and maintain strong professional bonds with them. Two areas that have been effective for me are compensation and training. I research what salaries are for management roles in my industry, and I try to set our team’s compensation higher. While the economics of a job aren’t everything, they’re a reflection of the results that I’m expecting someone to contribute, as well as an acknowledgement of what they’ve achieved in their career journeys. I’m also a huge believer in ongoing workforce development. A leadership team whose perspectives are consistently stimulated and stretched will undoubtedly be more valuable to their organization. To that end, I cover the cost of sending my executives to the Cambridge Judge Business School to earn their MBA degrees. In addition, I invest in a variety of short-term learning modules, seminars, and executive certificate programs to keep us all sharp and open to new ideas.
Q: But if these people are only going to leave, isn’t this a waste of money?
A: There’s no doubt my methodology improves the economic value of our executives, and is also expensive. But it’s also delivered significant job satisfaction for staff, and brought about measurable productivity/profitability improvements for the companies that I’ve led. But let me clarify this: it’s expensive at first, but in the long-term, the dividends that come about when an executive makes a job switch surpass the initial recruiting, training, and acclimation costs for someone to fill their open role.
Q: In what ways are these dividends greater?
A: In my experience, these dividends, which emerge gradually and have no expiration date, have consistently yielded four valuable outcomes for my organizations:
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1) When our execs begin new jobs elsewhere, the awareness and credibility of our organization improves among our peers and in the marketplace. The brand image of our company is also enhanced since the training, savvy, and skills that these execs possess are credited – by them – to their stints with our team.
2) One of the first things that former team members seek to establish once they begin new jobs are partnerships that could be advantageous to both of our organizations. Since they’re familiar with their former company’s unique capabilities, they can arrange mutually beneficial collaborations that demonstrate an ability to quickly deliver innovative solutions. Not only do I welcome these kinds of win-win opportunities, our former team members’ new employers also find them to be very impressive.
3) When these former team members begin to distinguish themselves in their new roles and share their thoughts with peers about their positive experiences at my company, these dialogues travel far and wide, and ramp up the quality of potential applicants who may want to work with me. Given the competitiveness of today’s employment landscape, having this kind of goodwill and enthusiasm among prospective new hires is invaluable. It creates a halo effect among motivated talent that allows me to discover, meet, and select premier candidates.
4) Because the execs who continue their careers at other firms depart on a positive and encouraging note, they’re always willing to help streamline the entry of their replacements into our workspace/culture. This generous assistance helps to simplify the onboarding process and reduce our onboarding costs.
Q: So do you argue HRDs really need to play the long game?
A: Yes. When an “all-star” emerges on our executive team, I tell him/her how much I value their contributions and let them know that I hope they stay with us for a while. I also let them know that if they’re still on board in five years, then I haven’t done my job since I wasn’t able to provide them with the guidance, tools, and resources for them to assume a next level leadership role at another firm. This offer of mentorship is honest and heartfelt. The long game mindset that we embrace may run counter to the tenure commitments that most business owners and CEOs expect from their employees, but it should be considered. It’s a slow and patient strategy that creates abundant growth benefits for team members (current and former), prospective hires, and management.