Talent Retention Strategies for Businesses
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What is talent retention? Why is it important? How can the public workforce system help companies with their talent retention efforts? All this and more is covered in this webinar! The full webinar may be purchased at www/nereta/org/training
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Talent Retention Strategies for Businesses
- 1. Talent Retention Penne Gabel, PHR Director, Talent Management Easter Seals New Jersey
- 2. What Does “Workforce Investment” Mean to You? • • • • • Job matching (who has the right skills to fill this job order?) Job development (what jobs are available?) Training (skills development, education) Helping people overcome barriers to employment Helping people “sell themselves” (resumes, interviews, cover letters)
- 3. What Does “Workforce Investment” Also Mean… • Job creation (business growth, development, succession planning) – “Bringing in the right people” (H1B visas, talent attraction) – At the right time (temp work, workforce planning) – At the right price (wage profiles) • Industry sector collaboration • Incumbent worker training (customized training) • Stabilizing the workforce (retention) • Employee engagement • Career planning (apprenticeship, internships, continuing education, transferable skills, retirement planning) • Entrepreneurship training
- 4. What is “Talent Retention?” • • • • Reduces hiring and training costs Offers career advancement Increases morale – more employee loyalty Increases productivity with lower learning curves
- 5. Why Talent Retention Matters Bureau of Labor and Statistics - Current Unemployment Rates
- 6. Estimated Turnover Costs • Job Type/gory Average Turnover Cost • • • • • • • Entry Level - Hourly, Non Skilled (e.g. Fast Food worker) 30-50% Skilled Hourly (e.g. Machinist) 70-100% Technical (e.g. Computer Technician) 100-150% Engineers (e.g. Chemical Engineer) 200-300% Specialists (e.g. Computer Software Designer) 200-400% Supervisors/Team Leaders (e.g. Section Supervisor) 100-150% Middle Managers (e.g. Department Manager) 125-200% Source: Case Study by Jack Phillips Center for Research, ROI Institute and Bloom Consulting, Inc. 2009
- 7. What helps people feel connected and want to stay in the region Networking: • Make connections/introductions. Facilitate networking opportunities (co-op working, tech meet-ups, sector meetups/career fairs) • Encourage school/college/business interactions (internships, job shadowing, career planning) • Engage students and young workers in cultural and recreational activities in the region Growth/Transition: • Discuss regional potential/opportunities in open forums • Encourage entrepreneurship training/access to capital • Encourage CEO training (business expansion)
- 8. External Public Relations Recognizing businesses who invest in their workforce – – – – – – – – – – tuition reimbursement home buying programs family leave Flexible work environments community donations Compensation and Rewards Socialization Opportunities for Development staff community volunteer programs, etc Employer of the month/year?
- 9. Talent Retention Factors within Businesses 1. 2. 3. 4. Organizational Development (career opportunities, training) Compensation (fair salary, generous benefits) Organizational Culture (work environment, policies, recognition) Motivational Compatibility (strengths, values and circumstances in position, in company, in community) 5. Workload (equitable, reasonable, expected) 6. Management (immediate supervisor, chain of command, organizational leadership)
- 10. So Why Do Employees Leave? Leigh Branham, author of 7 Hidden Reasons Employees Leave • Reviewed more than 20,000 exit surveys. Employers - 89 % believed that employees quit because of money Employees - 88% quit for something other than money.
- 11. Seven primary reasons for leaving a job: 1. Trust in leadership 2. Vision - Not feeling valued (pay, recognition, having your voice heard, being in the loop, having the right resources, etc) 3. Lack of connection with the overall strategy 3. Ineffective manager, particularly lack of coaching and feedback 4. Insufficient opportunity for personal career growth and learning 5. Job-person mismatch/talent underutilization 6. No enjoyment or excitement; challenging work
- 12. What keeps workers on the job? • Increased salary? More benefits? Security? • Most important are fulfillment of these employee needs: – Power – Achievement – Affiliation
- 13. • • • • • • Critical strategies for retaining employees Engagement Recognition Valuing Support Mobility/Career planning Clear goals
- 14. Internal public relations Creating Employee Loyalty • • • • • • Suggestion box Feel informed (company newsletter, intranet) Sense of purpose/clear goals Recognition of Accomplishments/Achievements Comraderie/Team approach Opportunity for Innovativeness
- 15. Employee Engagement "It goes in circles: When people are more engaged, their companies do better, and those companies have room to add more people. When employees are not engaged or are actively disengaged, their companies don't do as well, they don't hire new workers, and they may even lay off the workers they have. But when the ratio between engaged employees and actively disengaged employees improves, the whole company improves. That, in turn, can improve whole economies.“ - Sangeeta Agrawal, Gallup workplace research manager Only 9% of employees are engaged when not focused on strengths. But, engagement soars 73% when focus is on strengths -Strengths based Leadership – Rath and Conchie What if jobseekers put their strengths on their resumes? …and employers purposefully placed people in work situations that played to their strengths?
- 16. Contact Penne Gabel Director of Talent Management Easter Seals of New Jersey Email Phone Twitter LinkedIn gabelpenne@gmail.com 201-452-3777 hrpenne www.linkedin.com/in/pennegabel
- 17. 10 things the workforce system can do to help businesses with Talent Retention Colleen LaRose President and CEO North East Regional Employment and Training Association
- 18. Retention is required in all four DOL performance measures • ADULT, DISLOCATED WORKER AND OLDER YOUTH – “Retention in unsubsidized employment six months after entry into the employment” • YOUNGER YOUTH – “Placement and retention in postsecondary education, advanced training, military service, employment, or qualified apprenticeships” What are you doing to actively assure retention for placements?
- 19. What do you spend most of your time on? Helping people get a job Helping people stay employed
- 20. What Does “Workforce Investment” Mean to You? • • • • • Job matching (who has the right skills to fill this job order?) Job development (what jobs are available?) Training (skills development, education) Helping people overcome barriers to employment Helping people “sell themselves” (resumes, interviews, cover letters)
- 21. But Doesn’t “Workforce Investment” Also Mean… • Job creation (business growth, development, succession planning) – “Bringing in the right people” (H1B visas, talent attraction) – At the right time (temp work, workforce planning) – At the right price (wage profiles) • Industry sector collaboration • Incumbent worker training (customized training) • Stabilizing the workforce (retention) • Employee engagement • Career planning (apprenticeship, internships, continuing education, transferable skills, retirement planning) • Entrepreneurship training
- 22. The “Talent Retention” Concept • Regional retention –Brain drain • Talent retention for individual businesses – Controlling for churn, turnover, poor hiring, conflict (Not retirement, disability, death, etc.) Talent retention = business growth = job creation High cost of talent replacement Economic impact Economy stabilization
- 23. What Most Influences Talent Retention In Community •Belonging/fit in (CampusPhilly.org) •Quality of life •Opportunity to grow and improve In Business • • • • • • Career opportunities Work environment Work life balance Organizational justice Leave policy Organization image
- 24. Workforce Investment Opportunities 1. Worker preparation 2. Wage information/Job posting clarity 3. School/Business cooperation 4. Networking opportunities 5. Incumbent worker training 6. HR staff training/Management training 7. Business expansion training 8. Career path identification 9. Entrepreneurship assistance 10.Workforce planning software assistance
- 25. Workforce System Opportunity Worker preparation • Employee expectations • Powerpath • Strengths Identification
- 26. Workforce System Opportunity Wage information/Job postings • • • • Local labor market study Realistic wage information (based on local economy) Clarity with Job postings Realistic employer expectations
- 27. Workforce System Opportunity School/Business Cooperation • • • • Coordinate with college career placement offices Internships Job shadowing Career planning
- 28. Workforce System Opportunity Business and Employee Networking Opportunities • • • • • • • • Social responsibility/community volunteer opportunities Social/work integration opportunities (ie. company night out at a baseball game) Opportunity to socialize/network vertically and horizontally Co-op working Tech meet-ups Entrepreneur meet-ups Sector meet-ups Career fairs/Job fairs
- 29. Workforce System Opportunity Incumbent worker training Customized training Corporate training Coordinating customized training providers Sector approach to training
- 30. Workforce System Opportunity HR staff training/Management training • • • • • Employee engagement Employee recognition strategies Suggestion box Team Building Customized training
- 31. Workforce System Opportunity Business expansion training Market expansion opportunities Economic gardening CEO Training
- 32. Workforce System Opportunity Career Path Identification/Development • Career Development services by sector • Discussions about internal career path opportunities
- 33. Workforce System Opportunity Entrepreneurship Assistance • • • • • Local system of support for entrepreneurs and small business Innovative culture Co-op/Meetup (spontaneous) working opportunities Potential to become owner Hope
- 34. Workforce System Opportunity Workforce planning • Workforce planning fails when it is viewed as an HR issue rather than a business issue.
- 35. Workforce System Opportunity What is workforce planning? • Workforce planning is the process that provides strategic direction to talent management activities to ensure an organization has the right people, in the right place, at the right time and at the right price to execute its business strategy.
- 36. Workforce System Opportunity Most companies do workforce planning only on an “as needed “ basis • • • • • • Relocation Mergers and acquisitions Change in leadership Change in company strategy Global expansion Diversifying the workforce
- 37. Workforce System Opportunity Workforce Planning Software • Effective and efficient employee development and performance software that enables organizations to staff, develop, deploy, track and reward their workforce. • Applications address: – – – – – – requirements for hiring and selection human resources Payroll absence management and analytics integrated learning talent management solutions. • Solutions span the workforce life cycle, including performance, succession planning, streamline onboarding, skill and knowledge retention, reduce new hire time to productivity, social networking, compliance and compensation.
- 38. Questions? Need further assistance? NERETA can help! • Colleen LaRose President and CEO North East Regional Employment and Training Association (NERETA) P (908) 995-7718 E colleen@nereta.org www.nereta.org
Editor's Notes
- When you think of investing in the workforce, what is the first thing that comes to mind? If it means to you educating potential candidates on job search strategies, job development and training, job development, you are in the majority. Recruitment firms, Department of Labor, Workforce Planning agencies all specialize in grooming individuals for success. There is definitely a need to prepare the workforce for employment – it breeds more competition. Most firms strike a balance between buying and growing, although little if any strategic planning guides their decision. However, during tight economic times when recruiting budgets are severely restricted or even frozen, the emphasis almost always shifts dramatically toward “growing talent.”
- Regardless of size and financial ability, organizations should be thinking about their people – not only how to recruit them, but also how to train them, how to engage them and how to retain them. All too often organizations think about revenue, sales, their customers but not enough attention is made to their people. The successful employers of choice are making investments in their people. If you look at the Fortune 100’s best companies to work for, they all invest in their employees. Internal Workforce investments broadens the scope of talent management strategies.
- So what exactly is Talent Retention? Talent retention is not only about the outcome, it’s about an organizational strategy. There is a distinction between low performing employees and top performers and efforts to retain employees should be targeted at valuable, contributing employees. Talent retention programs are important and organizations and managers understand their value but often leave these programs for another day. The areas that fall under retention are large, over-arching organizational and cultural issues that organizations don’t have time for due to lack of resources. While this may be a large organizational undertaking, being aware that retaining high performers is as important as hiring them is half the battle. There are many advantages to retaining talent but some of the highlighted factors are mentioned here.
- The above slide is very telling. What this slide translates to is that low unemployment rates = fewer available candidates = more competition among employers. On the flip side, higher employment rates provide more options to find qualified talent. Over the last few years, our economic downturn produced a very qualified talent pool. Employers that were hiring had an large talent pool to choose from and People were accepting positions at lower salaries and at lower positions just to be employed. However, as the labor market starts to recover, more organizations are hiring again, and more people go back to work, those individuals that took lower level jobs at lower level salaries are leaving those jobs to return to the work that is more align with their skills. So what does this all mean? It means that employers need to prepare for the fluctuation in the labor market. Creating retention strategies gives those employers an edge in preparing for tight labor markets.
- Here are just some statistics relating to turnover costs. These costs include interviews, training, recruiter salary’s, separation processing, job errors, lost sales, etc. Turnover has a direct affect on organizational effectiveness and performance. Employee turnover is a symptom of a deeper issue that may not get resolved. These issues could be low morale, absenteeism, lack of clear career path, lack of recognition, or even poor employee/manager relations. Lack of satisfaction and a commitment to the organization can also play a part in why an employee withdraws and begins looking for other opportunities. Pay is important, but not necessarily the #1 reason why people leave organizations. In an article in Forbes Magazine dated 1/2/20013 the top 5 reasons why people leave organizations are #1Stability #2 Compensation #3 Respect #4 Health Benefits #5 Work-Life balance
- Employers based in the more remote regions of the US have a harder time retaining individuals simply based on their location, their inability to compete with the larger markets and the inability to provide competitive compensation packages due to financial constraints. The factors in these slides are all ideas to that will help retention in certain regions. However, if organizations can examine their workforce and understand what drives them, this could help them to develop retention strategies. For example, let’s look at the generational aspect of the workforce. The X generation (born between 1988-1994) is known as the “what’s in it for me” generation. Gen X’ers are arguably the most educated generation with 29% obtaining a Bachelor’s degree or higher. With that education and growing maturity they are starting to form families. The Gen Y generation, making up 71 million people (born between 1977-1994) are more technically sophisticated and culturally diverse. All these generational factors come in to play when organizations think about retention (how best to communicate, what stimulates those individuals, what benefits are required to retain the high performers?). Employer branding also plays a large role. Companies that participate in career fairs and networking opportunities as well as having corporate social responsibility programs within their communities have an advantage over those organizations that don’t participate in these activities. If the organization employs more Gen X’ers, they tend to be more socially corporate individuals and therefore, may look for employer that have CSR programs.
- Certain companies retain good employees by being good employers. While it’s easy to think of attraction and retention in terms of compensating people, that is only a small part of the picture. In an environment where there is scarcity in certain industries, it comes down to quality of work life. If you look at the list of the top 10 best companies to work for, it’s all about the investment the employers make on their employees.
- There are several factors to consider at a local level of the organization. When you start to drill down in to the organization, there are several factors that have a more direct impact on retention. Career planning, equitable compensation, recognition, employee relations are day to day factors that increase the likelihood of retaining top talent. Therefore, organizations need to invest in management and leadership training. Strong leadership that drives organizational culture and that has a direct interaction with the workforce will be a key driver as to whether or not a top performer wants to stay or leave.
- According to a recent Department of Labor statistic, the average tenure of an employee in the US is 1.5 years – 5 years. What do these numbers mean? There is a saying that employees don’t leave companies, they leave managers.
- It was very interesting that not one of the reasons for leaving a job was only because of pay. Vision: Most employees don’t get out of the bed thinking about profits. Managers should not confuse their financial objectives with vision. Vision feeds financials. Successful managers should be talking to their employees on the vision of the future. Walt Disney made $128 million on his vision. No Connection to the Big Picture: People need to make the connection of their value/worth they have within the organization. Making a connection to the mission of the organization helps the employee stay engaged. Take Google. Do you think that all the employees know how the Google search engine works? No! But they understand Google’s mission “to organize the world’s information and make it accessible and useful”. No Empathy: Gone are the days of loyalty on both the employer and employee. However, employees want to believe that what they have to say makes a difference so it’s important for managers listen. NO (effective) motivation: If you’ve ever read Daniel Pink’s book Drive, he talks about what motivates people and the difference between “extrinsic” and “Intrinsic” motivators. Extrinsic motivators are the traditional carrot and stick motivators with cash awards while the intrinsic motivators are those who just want to do a good job. Incentives are not about monetary rewards, they are also about what makes people excited about their jobs. Managers need to be thinking more about those intrinsic motivators. No future: communicating career paths are not something that companies do well. For any employee worth keeping, a manager must make clear how and where they move in their career. NO FUN: In the previous slides I spoke about the generational factors that require employers to consider. This is a perfect example of the X’ers and Gen Y’ers – both of these individuals live and breath the Internet, handheld devices, and social media tools as part of their daily lives. Companies need to reinvent their work environments, blurring the lines between work and play. Companies and their managers should embrace a culture of increased autonomy.
- In a century where mergers and acquisitions are common, retirement savings wiped out during the market crash in the late-2000’s , and with the uncertainty of the new Insurance Marketplace as a result of Obamacare, job security and health benefits are probably the most important factors that worry workers these days. As important as why people leave organizations, it’s important to understand why they stay.
- We can’t stress enough the value of creating strategies for retaining employees. While the list here are all important factors in retaining employees, Best practices focus on the fundamentals. Defining their culture and the types of individuals that would thrive in that environment is a great place to start. Fundamentals such as recruitment, New Hire Orientation and on boarding are all wasted if employees are not positioned to succeed within the company. The first 10 – 90 days are the most critical in retaining employees. Socialization practices can help new employees become embedded in the company and thus more likely to stay. Activities that allow people to get ot know one another goes a long way. Such practices include mentoring.
- Communication is one of the most important factors that help employees make a connection to an organization’s mission, vision and values. Technology provides a variety of ways that can improve communication. Company intranets and Wiki’s are a powerful tools that can relay messages globally. These innovative forms of communication allow for more opportunity to share information between employees, departments, and to make connections internationally which can provide employees with a sense of belonging even from the most remote locations.
- It’s important for companies to take the temperature of their organization. An engaged employee is one who is fully involved in and enthusiastic about their work. Engagement is the emotional commitment the employee has to the organization’s goals. There’s a difference between Employee satisfaction and employee engagement are not one in the same. A satisfied employee may show up for work 9-5 and not complain but that same employee wont go the extra mile for the organization and likely take a headhunter’s call being lured away with a 10% bump in pay. Companies interested in employee engagement use surveys to acquire the temperature of their workforce. Survey’s allow an organization to understand the companies strengths and weaknesses. A more engaged workforce leads to higher productivity and customer satisfaction based on a Gallup study.