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Everyone wants a sense of security; the confidence that we will earn enough to support ourselves and our families in the years ahead. But our ideas about what will give us security have changed dramatically over recent decades.
Older individuals are likely to see security embodied in one career, preferably at one firm, rewarded eventually by a good pension. But most mid-career employees today find the notion of trading loyalty for a distant pension deeply troubling; they know only too well that long-term employment is by no means guaranteed. And most younger workers reject the idea outright.
“Security” for most people today comes in the form of options – the confidence that one could gain a new job if this one were to end.
It’s time to reflect this shift in your approach to recruitment and retention. For too long employers have used the old employee contract, which asks for loyalty in return for the promise of long-term protection and care. We have continued to seek unwavering loyalty while trying to obfuscate the reality that layoffs are now an accepted approach for matching workforce capacity to demand. It’s no surprise that it feels disingenuous to many on both sides of the equation.
So, what should we promise people in order to recruit and retain the talent we need? In short, we should promise them that they will be well positioned to leave. Sound crazy? Maybe – but helping people believe they will have more options after working in your firm is the best way to attract and retain them now. Here’s what you should do.
Take a hard-nosed look at what happens to people who leave your organisation, voluntarily or otherwise. Do they land in better positions than they had with you? If so, you should be proud. That’s great news. If they don’t – if they struggle or are forced to take positions at lower levels – you’ve got work to do.
‘Building a sense of security among your employees is essential today’
If possible, begin to collate some hard data from your exit interviews on salaries obtained by those leaving. Then calculate the rate of appreciation for those who worked for you. For example, imagine that you hired someone for £50k and, after two years, they left you for a position that paid £70k. That’s an 18% annual rate of appreciation – the sort of result you should be shouting from the rooftop to every new recruit. Being with you has caused a significant increase in the value of their human asset. This result gives everyone who remains in your organisation a greater sense of security – confidence that options would be available to them if they were ever needed.
It’s this sense of security through options that you need to cultivate to keep people with you in the long term. It sounds contrary, but it’s knowing that working with you is adding to their marketability that encourages people to stay. This belief needs to continue throughout an individual’s time with you. If you signal that they’ve reached a plateau and you’ve finished investing in them, your best people will (and should!) feel uneasy. They will begin to look for environments where they can continue learning and strengthening their personal brand, leaving you with people whose capabilities really do limit their value elsewhere – and to you.
The need for learning, lifelong, has become an accepted reality in most people’s view of their work lives. Young people consistently rate “opportunity to learn” the number one reason they choose one job over another. The biggest draw you can realistically offer is the promise to provide opportunities to enhance peoples’ capabilities; through formal training, if relevant, but even more importantly, through challenging assignments and the ability to work with other smart, accomplished people. Companies will compete for talent on the basis of the learning they provide.
One of the best ways to step up the ability to learn within your organisation is to structure work as projects. One firm sets the goal of enlisting every person at every level in at least one project every year. These become highlights – people look forward to the opportunity to work with others drawn from across the company; to explore ways to improve or address a specific issue and, in so doing, to learn something new.
Historically, the role of a manager was to ensure compliance to standardised best practices. Providing “feedback” meant judging or assessing an individual’s skill in performing the assigned task. This approach makes great sense in an industrial context. But as more of the work that truly differentiates businesses shifts to what I call “leveraging intelligence” – tapping the discretionary effort of individuals to innovate, collaborate, sense new opportunities and serve customers in customised and empathetic ways – the role of a manager shifts to one of coaching. Today, when young employees ask for “feedback”, they certainly are not asking for an assessment (even if the conclusion would be positive): they want more. They want advice on how to improve.
The best leaders today, when interacting with their teams, sound more like teachers than traditional line managers. They might describe the month’s work in terms of what needs to be done, but also what they expect team members to learn as they do it. Learning goals are inextricably linked with the work to be done. Shifting your managers from an assessment to a teaching mindset is one of the most important ways to retain your best people.
Your message about the benefits of being with you should focus on the importance or meaning and the challenge or learning associated with what you’re asking them to do now, plus the number of options that doing this work will open up in the fairly near term. I recommend never talking about a timeframe longer than two years.
Employees of all ages want to know that their time is being spent in valuable ways; that it is being invested wisely for the benefit of both the business and their own marketability. Younger employees absolutely insist on this certainty. Talking about personal benefits that will accrue in five-plus years just doesn’t resonate. Instead, create a sense of momentum by describing opportunities that are likely to be created by demonstrating success in an individual’s current role. Apply this same two-year timeframe to your own development investment strategy. Never invest in training someone for, say, five years with the expectation that an employee will then stay with you for an additional 10 years to “pay you back.” The best ones won’t. Be sure you develop a “rapid ROI approach” to your investments in development.
The sense of more options opening up in the future should be deeply embedded in the design of career paths. Traditional career paths tend to narrow as one goes higher. You become more specialised. This terrifies many younger employees today – they worry that a change in direction could eliminate the need for their specific skill, leaving them with few other options.
Instead, always present positions in terms of the options the individual will have after performing the role successfully. Every position should qualify them to take on half a dozen other roles in your organisation, rather than just one. When you first present the new option, be explicit about the half dozen others that success here will open up. And, when the time comes for the next promotion, give the individual as much choice in selecting among the options as possible.
One of the best ways to remind people that they are increasing their marketability is to recognise new skills and capabilities with commercially valuable credentials. “Badging” – signifying and communicating on-the-job learning and achievements – will grow. The most valuable remuneration you can provide to those who work for your organisation today is publicly visible credentials that the job market will value.
The desire to be able to describe one’s capabilities accurately and credibly will grow as more people enter the contingent workforce. To facilitate tapping the right person from the open market, employers will seek task-specific credentials: believable, verifiable evidence that the individual has done or knows how to do the task at hand. And, as job-specific badging grows, college degrees will diminish as a currency in the job market, except for the very newest employees.
In addition to providing formal credentials, create other ways to capture individuals’ work bona fides. Develop a platform to facilitate ratings by peers, customers and others. Capture the soft side of an individual’s work performance – the degree to which they help others, collaborate effectively, contribute to the work of others, provide exceptional service or demonstrate empathy – by facilitating the capture of “likes” or stars or other peer-to-peer and customer-based forms of recognition.
And don’t scrimp on public recognition. Make your employees’ accomplishments known outside your organisation, even if it’s as simple as a press release to their home-town paper or a mention on your public website. Remember, it’s not about giving them a trophy – it’s about building their sense of security that working with you is keeping them marketable.
Does your firm have a reputation for being a great source of talent? It should! Just as for many years General Electric was known as the place to hunt for skilled leaders, or Proctor & Gamble was known for well-trained product managers, your firm should also be known as the best source of talent in specific disciplines or capabilities.
Begin by identifying the skills or tasks that one would logically associate with your business. Project management? Product launch? Internal audit? Then invest in developing your reputation in those areas. Identify what is unique and exceptionally effective about your approach. Provide specialised training. Develop a credential (or series of credentials), along with the specific criteria associated with earning each badge. Consider collaborating with other companies with similar functions to develop task-specific credentials you can all depend on. Promote your company’s strengths in these skillsets through articles and speeches. Make it very special (and valuable) to have been named, for example, a Master of Product Launch at your firm.
Learning may be the most important way but is certainly not the only one to multiply someone’s sense of security based on options. Contacts are also important in today’s employment world. Help your employees increase their referential contacts – not people who would hire the individual themselves, but those who recognise the value of your employee’s skillset and would know who needs it.
For example, make sure people have the time and financial support necessary to participate in professional associations of their peers. Bring in well-known experts to give in-company seminars and arrange a meet-and-greet reception to follow. Encourage people to attend external seminars. Their sense of security will grow to the extent that they don’t feel cut off from the market.
Traditional recruiting conversations focus on the positive features of your organisation. Instead, invert the conversation to focus primarily on the candidate’s interests and goals – and how your organisation can help achieve them. Continually emphasise the number of options or choices that will open up over the years ahead.
If employees do go off to see if the grass is greener elsewhere, invite them to return. One company paints each returner’s name on a real boomerang and displays them on the walls, reinforcing the number of people who have concluded that the greener grass is right where they started – and sending a powerful message to those who have yet to venture away.
Building a sense of security among your employees is essential today. People who are worried or fearful will not invest their best efforts in the work they are doing for you. They are less likely to offer fresh, challenging perspectives and less likely to suggest changing the status quo, even if it would eventually lead to better performance. People without a sense of security typically adopt a “heads-down” posture.
At the recruitment point, decisions about which job to accept are shifting from a cash-assessment criterion (which offer pays the greatest salary today?) to an asset-appreciation one (what will give me the most attractive options down the road?) And throughout the individual’s career, retention depends on a continued sense of marketability; of options that provide “what if?” security.
The implicit contract between employers and employees has changed. Rather than expecting loyalty in return for a now-broken promise of long-term protection and care, the new, implicit contract asks for the individual’s best discretionary effort for the time they are with you, in exchange for work that is important and challenging; work that will build the individual’s future options and marketability.