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Love’em Or Lose’em

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Love’em Or Lose’em

  1. 1. Proven Strategies to Enhance Retention and Become an Employer of Choice Love’em or Lose’em By: Bogdan Damjanovic, P.Eng. Owner, Express Employment Professionals
  2. 2. What’s missing? <ul><li>Managers identified the following soft skills as being the most important at their organizations: </li></ul><ul><li>Organization Skills 87% </li></ul><ul><li>Verbal Communication 81% </li></ul><ul><li>Teamwork & Collaboration 78% </li></ul><ul><li>Problem Solving 60% </li></ul><ul><li>Tact & Diplomacy 59% </li></ul><ul><li>Business Writing 48% </li></ul>
  3. 3. <ul><li>Definition of Turnover </li></ul><ul><li>Turnover Cost Factors * : Annual Salary </li></ul><ul><li>Benefits/Burdens </li></ul><ul><li>Expected Length of Vacancy </li></ul><ul><li>* Calculations include conservative estimates and assumptions based on research by Price Waterhouse's Saratoga Institute and the University of Wisconsin </li></ul><ul><li>http://www.expresspros.com/us/turnover.aspx </li></ul>Number of Separations Total Number of Workforce = Turnover
  5. 5. Truths About Turnover <ul><li>Truth #1 – Turnover happens </li></ul><ul><ul><li>0% turnover is not realistic nor desirable </li></ul></ul><ul><ul><li>Good employees quit & leave </li></ul></ul><ul><ul><li>Bad employees quit & stay </li></ul></ul><ul><li>Truth #2 – Some Turnover is Desirable </li></ul><ul><li> - New employees bring new ideas, approaches & attitudes </li></ul><ul><li>Truth #3 – Turnover is costly </li></ul><ul><ul><li>Cost of turnover varies from $1,000 for an entry level employee to several thousand for an executive </li></ul></ul>
  6. 6. Truths About Turnover <ul><li>Truth #4 – More $money$ is not always the answer </li></ul><ul><ul><li>89% of managers surveyed think money is the primary factor of turnover. </li></ul></ul><ul><ul><li>However, most employee surveys rank money as 9 th or 10 th reason for turnover. </li></ul></ul><ul><ul><li>Employees do want fair & competitive pay. </li></ul></ul>
  7. 7. Truths About Turnover <ul><li>Truth #5 – Manager is the best person to fix the problem. </li></ul><ul><ul><li>50% of worker satisfaction is related to their relationship with their leader. </li></ul></ul><ul><ul><li>Managers, not HR Departments, should be the driver of employee retention. </li></ul></ul><ul><ul><li>Areas of leader’s ownership: </li></ul></ul><ul><ul><ul><li>Hiring </li></ul></ul></ul><ul><ul><ul><li>Performance appraisal </li></ul></ul></ul><ul><ul><ul><li>Influence senior managers for needed change. </li></ul></ul></ul><ul><ul><ul><li>Most important – EMPLOYEE RECOGNITION </li></ul></ul></ul><ul><li>Truth #6 – Turnover demands commitment </li></ul>
  9. 9. <ul><li>March 2010 </li></ul><ul><li>The national unemployment rate remained unchanged at 8.2% </li></ul><ul><li>Employers added 18,000 jobs </li></ul><ul><li>This is the sixth employment gain in the past eight months </li></ul><ul><li>Job gains were seen in Ontario, Quebec, and Saskatchewan as follows: • Construction: + 21,000 • Manufacturing: + 3,900 • Trade: + 13,700 • Transportation & Warehousing: - 19,600 • Finance, Insurance, Real Estate & Leasing: - 7,400 • Professional, Scientific & Technical Services: + 38,400 • Business, Building & Support Services: - 26,300 • Educational Services: + 6,200 • Healthcare & Social Assistance: + 5,100 • Information, Culture & Recreation: - 6,500 • Accommodation & Food Services: - 3,300 • Public Administration: + 7,900 </li></ul>
  10. 10. Why So Much Turnover? <ul><li>Higher expectations </li></ul><ul><ul><ul><li>People want more than a job </li></ul></ul></ul><ul><ul><ul><li>They want time off and $$ </li></ul></ul></ul><ul><ul><ul><li>Career opportunities earlier </li></ul></ul></ul><ul><ul><ul><li>Employers no longer viewed cradle-to-grave </li></ul></ul></ul>
  11. 11. Why So Much Turnover? <ul><li>Longer hours, more demanding work </li></ul><ul><ul><ul><li>Productivity increased 6.9 percent in the nonfarm business sector during the fourth quarter of 2009 as unit labor costs fell 5.9 percent </li></ul></ul></ul><ul><ul><ul><li>From 1977 to 1997, average workweek grew from 43.6 hours to 47.1 hours. </li></ul></ul></ul><ul><ul><ul><li>More overtime expected with no notice. </li></ul></ul></ul><ul><ul><ul><li>33% of employees bring work home. </li></ul></ul></ul><ul><ul><ul><li>64% of all employees want to work less. </li></ul></ul></ul>
  12. 12. Why So Much Turnover? <ul><li>Family demands </li></ul><ul><ul><ul><li>Day care </li></ul></ul></ul><ul><ul><ul><li>Elder care </li></ul></ul></ul><ul><ul><ul><ul><li>25% of workforce provides 11 hrs per week </li></ul></ul></ul></ul><ul><ul><ul><li>Men are just as likely as women to adjust schedules for elder care </li></ul></ul></ul>
  13. 13. DO I NEED A RETENTION PROGRAM? Take the Quiz (If you score more than two “no’s” you need to get serious about retention.)
  15. 15. Ten Reasons Good Performers Leave <ul><li>No link between pay & performance </li></ul><ul><li>They don’t perceive advancement opportunities </li></ul><ul><li>Their contributions are not recognized </li></ul><ul><li>They don’t get to use their natural talents </li></ul><ul><li>They have unclear or unrealistic expectations </li></ul><ul><li>They will no longer tolerate abusive managers </li></ul><ul><li>Management’s cutback on administrative help </li></ul><ul><li>Constant reorganization of management </li></ul><ul><li>Management not taking time to clarify goals & objectives </li></ul><ul><li>Management favoritism </li></ul>Note: All Ten Reasons Involve Managers
  17. 17. <ul><li>The worst time to do them is on the last day </li></ul><ul><li>Conduct them after employee departure </li></ul><ul><ul><ul><li>One to two weeks </li></ul></ul></ul><ul><ul><ul><li>Call at home </li></ul></ul></ul><ul><ul><ul><li>Employees are more willing to speak </li></ul></ul></ul><ul><ul><ul><li>Better to meet in person due to body language </li></ul></ul></ul><ul><ul><ul><li>Use the opportunity to begin recruiting them back </li></ul></ul></ul><ul><li>Interviews are superior to surveys </li></ul><ul><ul><ul><li>Prepare for both </li></ul></ul></ul><ul><ul><ul><li>Ask detailed questions </li></ul></ul></ul><ul><ul><ul><li>Expand as necessary </li></ul></ul></ul><ul><ul><ul><li>They are as important as employment interviews </li></ul></ul></ul>Exit Interviews
  18. 18. <ul><li>What caused you to seek other employment? </li></ul><ul><li>Why did you accept a new position? </li></ul><ul><li>Describe working for our company. </li></ul><ul><li>Rate compensation and benefits. </li></ul><ul><ul><ul><li>Benefit improvements </li></ul></ul></ul><ul><li>Describe training. </li></ul><ul><li>Did you observe teamwork? </li></ul><ul><li>Describe the relationship between your department and others? </li></ul><ul><li>Could the company have prevented your leaving? </li></ul><ul><li>What needs were not met? </li></ul><ul><li>Did you get to do what you do best? </li></ul>Exit Interviews Suggested Questions
  19. 19. <ul><li>Identify specific things you would change. </li></ul><ul><li>How would you rate the company on: </li></ul><ul><ul><ul><li>Ethics Honesty </li></ul></ul></ul><ul><ul><ul><li>Integrity Trust </li></ul></ul></ul><ul><li>How would you describe your leader? </li></ul><ul><ul><ul><li>Treated fairly </li></ul></ul></ul><ul><ul><ul><li>Recognized for your contributions </li></ul></ul></ul><ul><ul><ul><li>Fair appraisals </li></ul></ul></ul><ul><ul><ul><li>Treated consistently as other department members </li></ul></ul></ul><ul><li>Would you recommend this place to a friend or relative? </li></ul><ul><li>Would you consider re-employment? </li></ul>Exit Interviews Suggested Questions
  20. 20. <ul><li>Utilize internal focus groups to analyze turnover. </li></ul><ul><li>Survey employees on why they stay. </li></ul>Exit Interviews vs. Stay Interviews
  22. 22. Common Core Elements of Organizations That Excel at Retention <ul><li>ETHICS </li></ul><ul><li>INTEGRITY </li></ul><ul><li>HONESTY </li></ul><ul><li>TRUST </li></ul>
  23. 23. <ul><li>No benefits, compensation program, gimmicks or rewards can replace the four core elements. </li></ul><ul><li>The organizations excelling in the four core elements win the war for talent. </li></ul>Ethics, Integrity, Honesty, and Trust
  24. 24. Common Core Elements of Organizations That Excel at Retention <ul><li>How do you measure your commitment to the four core elements? </li></ul><ul><li>Ask yourself: Does your organization? </li></ul><ul><li>Conduct business according to professional standards? </li></ul><ul><li>Does your company culture support disclosure of truth even when it hurts? </li></ul><ul><li>Does your company base its business decisions on established values? </li></ul>
  25. 25. Common Core Elements of Organizations That Excel at Retention <ul><li>Has your CEO earned the trust of your employees? </li></ul><ul><li>Does your leadership team accept responsibility for failures or blame others? </li></ul>
  27. 27. Facts on Recognition <ul><li>According to an article in Compensation and Benefits review: </li></ul><ul><li>81% of workers claim they do not receive any reward for increase in productivity. </li></ul><ul><li>60% of managers report the same. </li></ul><ul><li>Only 3% of base salary separates average from outstanding employees. </li></ul><ul><li>Most companies have overused giveaways such as: </li></ul><ul><li>Coffee Cups, Pens, T-shirts, Certificates </li></ul>
  28. 28. Facts on Recognition <ul><li>Employees’ favorite form of recognition: </li></ul>PRAISE
  29. 29. Why Employees Leave and Stay <ul><li>Employees and Managers are somewhat disconnected on “WHY” employees leave and stay </li></ul>Good wages: Job security: Promotion/growth: Good working conditions: Interesting work: Personal loyalty to employees: Tactful discipline: Full appreciation of work done: Sympathetic help on personal problems: Feeling “in” on things: 7 4 5 9 6 8 10 1 3 2 Employee Ranking 1 2 3 4 5 6 7 8 9 10 Manager Ranking
  30. 30. Best Practice Retention Elements <ul><li>Saratoga Institute survey of 40 Fortune 100 companies including: </li></ul><ul><ul><ul><ul><li>Dell Honda of America </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Verizon UPS </li></ul></ul></ul></ul>
  31. 31. <ul><li>Innovative compensation & benefits/stock options </li></ul><ul><li>Formal rewards & recognition programs </li></ul><ul><li>Good performance management </li></ul><ul><ul><ul><li>Aligning employees goals with business goals </li></ul></ul></ul><ul><li>Strategies & measures for increasing employee retention </li></ul><ul><li>Formal career planning </li></ul><ul><li>Work/Life strategies </li></ul><ul><li>Mentoring programs </li></ul>Best Practice Retention Elements
  32. 32. Recognition Gestures Can Be Simple <ul><li>Hewlett-Packard </li></ul><ul><ul><li>Golden Banana Award </li></ul></ul><ul><li>Tektronix – Beaverton, OR </li></ul><ul><ul><li>“ You Done Good” Cards </li></ul></ul><ul><li>NASA – Johnson Space Center </li></ul><ul><ul><li>“ Thanks a Million Award” </li></ul></ul><ul><ul><li>10 – $100,000 candy bars </li></ul></ul><ul><li>Kory Electronics – Seattle, WA </li></ul><ul><ul><li>President Head Shaving </li></ul></ul>
  33. 33. Recognition Gestures Can Be Simple <ul><li>Supplying ice cream or Popsicles on a hot day. </li></ul><ul><li>Hiring someone to clean windshields in parking lot on a snowy day. </li></ul><ul><li>Lottery tickets </li></ul><ul><ul><ul><li>Grab as many as you can from a fish bowl </li></ul></ul></ul><ul><li>Hiring H.S. students to wrap holiday gifts. </li></ul><ul><li>Being creative on job titles. </li></ul><ul><ul><ul><li>Sales Manager vs. Salesperson </li></ul></ul></ul>
  34. 34. <ul><li>On-site child care for $250/mo </li></ul><ul><li>Laundered workout clothes </li></ul><ul><li>Golf – Tennis – Dance Classes </li></ul><ul><li>Cafeteria w/piano music – Families welcome </li></ul><ul><li>Art on every wall </li></ul><ul><li>Free health clinic </li></ul><ul><li>Elder care coordinator </li></ul>Retention Techniques SAS Institute – Cary, NC - Software Developer Ranked 3 rd in 100 best companies to work for
  35. 35. <ul><li>Financial planning for college & retirement </li></ul><ul><li>SAS spends $45K annually on 22 tons of candy </li></ul>SAS Turnover Rate: 3.7% 20% below industry average
  36. 36. DESPITE: NO STOCK OPTIONS COMPETITIVE SALARIES Note: Based on 5,000 employees SAS is losing 850 less than the industry average
  37. 37. <ul><li>IBM employees in Atlanta wear cutoffs and sandals to work. </li></ul><ul><li>Employees at Tech Data Corp., Tampa, FL enjoy meals prepared by an executive chef. </li></ul><ul><li>Electronic Arts – Canada, has a 70 seat movie theater. </li></ul><ul><li>Construction Equipment Co., Louisville, KY, gives employees’ children a $50 savings bond for straight “A” report cards. </li></ul><ul><li>Workers at Netscape, Mountain View, CA., can bring dogs to work </li></ul>Retention Techniques
  38. 38. <ul><li>Anheuser-Bush, St. Louis, gives every employee two free cases of beer each month. </li></ul>Retention Techniques A COMMON FAVORITE:
  39. 39. <ul><li>Retention bonus </li></ul><ul><li>Busing or transportation support </li></ul><ul><li>Wash employee’s cars in the parking lot </li></ul><ul><li>Allowing employees to select job titles </li></ul><ul><li>Giving every employee business cards </li></ul><ul><li>Donating to employees’ children’s sports teams </li></ul><ul><li>Free gardening plot on company land </li></ul><ul><li>Free limo service on wedding day </li></ul><ul><li>Free Starbuck’s coffee </li></ul><ul><li>Two-week paid leave for new fathers </li></ul><ul><li>Free infant car seats for new parents </li></ul><ul><li>Free breakfast </li></ul>Other Out-of-Box Retention Techniques
  41. 41. <ul><li>Hiring for talent over experience </li></ul><ul><ul><ul><li>Do not become fixated on key knowledge areas </li></ul></ul></ul><ul><li>Be Prepared when Hiring </li></ul><ul><ul><ul><li>Not the Warm body approach </li></ul></ul></ul><ul><ul><ul><li>Use Updated job descriptions </li></ul></ul></ul><ul><li>Balance with analysis </li></ul><ul><ul><ul><li>Avoid Hiring by gut feeling alone </li></ul></ul></ul><ul><li>Avoid “Search for Superman” syndrome </li></ul><ul><ul><ul><li>Do not have too many people involved in the process </li></ul></ul></ul>Hire the Right Person
  42. 42. <ul><li>Encourage Diversity </li></ul><ul><ul><ul><li>Discourage “Hiring in your own Image” </li></ul></ul></ul><ul><li>Avoid “Politically Motivated” hiring </li></ul><ul><ul><ul><li>Including: the manager’s neighbor’s friend’s cousin’s boyfriend, or the “I owe a favor” approach </li></ul></ul></ul>Hire the Right Person
  43. 43. <ul><li>Bahavioural Interviewing - proof of performance </li></ul><ul><ul><ul><li>Competency based interviews </li></ul></ul></ul><ul><ul><ul><li>Give me an example when…. </li></ul></ul></ul><ul><li>Accurately describe the job </li></ul><ul><ul><ul><li>Mix the good with the bad </li></ul></ul></ul><ul><li>Consider the internal candidate </li></ul><ul><ul><ul><li>Internal Job posting </li></ul></ul></ul><ul><ul><ul><li>Don’t allow managers to hold onto talent </li></ul></ul></ul><ul><li>Encourage employee referrals </li></ul><ul><ul><ul><li>Produces the highest source of long term hires </li></ul></ul></ul>Hire the Right Person
  45. 45. <ul><li>No parking pass. </li></ul><ul><li>You had to watch 28 videos on how great it is to work here. </li></ul><ul><li>You signed a 300 page employee handbook stating you fully understood everything in it. </li></ul><ul><li>Your cubicle is being used as storage. </li></ul><ul><li>You were kept in the lobby for three hours. </li></ul>Typical Disasters Employee’s First Day
  46. 46. <ul><li>You signed two dozen forms asking for info you didn’t bring. </li></ul><ul><li>You go meet your boss only to learn that s/he is on vacation. </li></ul><ul><li>Your name tag is misspelled. </li></ul><ul><li>The senior vice president calls you at home and tells you of a reorganization. </li></ul>Typical Disasters Employee’s First Day
  48. 48. New Hire Checklist Orientation is a process, not a program!
  49. 49. <ul><li>Provide key written material such as handbook, etc. </li></ul><ul><li>Arrange for office furnishings, computer, telephone, supplies, etc. </li></ul><ul><li>Consider taking the new hire to lunch prior to the 1 st day. </li></ul><ul><li>Plan how you want the new hire to spend their first day </li></ul><ul><ul><ul><li>Who to see </li></ul></ul></ul><ul><ul><ul><li>Set schedule </li></ul></ul></ul><ul><li>Have contact person call to answer questions </li></ul><ul><li>Leave your own calendar open at the beginning and end of the first day </li></ul><ul><li>Send a welcome basket or flowers to home (include spouse) </li></ul>New Hire Checklist Prior to the First Day:
  50. 50. <ul><li>Meet with your employee early in the day to establish performance objectives and expectations. </li></ul><ul><li>Introduce the new employee to as many people as possible, including the CEO </li></ul><ul><ul><ul><li>Let them make their own opinions </li></ul></ul></ul><ul><li>Review organization charts thoroughly. </li></ul><ul><li>Have business cards available. </li></ul><ul><li>Consider having a surprise welcome party. </li></ul>New Hire Checklist Day one:
  51. 51. <ul><li>Have someone tour them through the facility. </li></ul><ul><ul><ul><li>Assign a first week mentor </li></ul></ul></ul><ul><li>Schedule orientation sessions in groups where possible and have them in the afternoon or on the second day. </li></ul><ul><li>Provide a new employee a reserved parking spot. </li></ul><ul><li>Provide them with some company logo merchandise. </li></ul>New Hire Checklist Day one:
  52. 52. <ul><li>Introduce new employee very enthusiastically during a group meeting. </li></ul><ul><li>Newspaper announcements </li></ul><ul><li>Pair up the new employee with a peer. </li></ul><ul><li>Schedule one-on-one meetings with key personnel. </li></ul><ul><li>Give an appropriate and challenging assignment during the first week. </li></ul><ul><li>Schedule any necessary training. </li></ul><ul><li>Check in with new employee from time to time in first week. </li></ul>New Hire Checklist During week one:
  53. 53. <ul><li>Schedule a 3-month feedback session. </li></ul><ul><li>Allow employee to re-write their job description, if outdated. </li></ul><ul><li>Have employee complete new hire survey. </li></ul>New Hire Checklist The first three months:
  54. 54. SUMMARY
  55. 55. <ul><li>You cannot achieve excellent retention without an excellent hiring process. </li></ul><ul><li>Create dialog between employees and managers on work/life issues. </li></ul><ul><li>Have managers re-recruit their employees regularly. </li></ul><ul><li>Conduct employee opinion surveys regularly to measure job satisfaction and react to the results. </li></ul>Summary
  56. 56. <ul><li>Hold annual benefit and communication sessions to educate your employees. </li></ul><ul><li>Conduct exit interviews to find out why they are leaving. </li></ul><ul><li>Train managers and hold them accountable </li></ul><ul><li>Keep management’s attention on turnover. </li></ul><ul><li>Orientation is a process, not a one day program. </li></ul>Summary
  57. 57. <ul><li>BECOME AN EMPLOYER OF CHOICE </li></ul>Summary
  58. 58. Contact Details: Bogdan Damjanovic, P.Eng., Owner Express Employment Professionals Tel: (416) 590-9948