When your team loses a member, the effect on productivity is usually profound and negative. Therefore, anything that you can do to prevent turnover of team members is probably well worth the effort. Let’s look at some techniques that companies use to retain employees. As a team leader, you may not be able to act on all of these strategies yourself. But you may be able to implement some of the suggestions—or at least lobby for them.
A tale from the trenches
Several years ago, I had the privilege of working for a major state-funded university hospital as a project manager in its emerging technology group. Unfortunately, during this time the hospital was suffering from the strain of state- and federal-mandated budget cutbacks. Hence, a salary freeze went into effect.
For a period of four years, I continued to work diligently for this hospital while my standard of living continued to slip. Why? The reason is quite simple: I was given the opportunity to become trained as a DBA on a data-warehousing project. In addition, I led the development of a major intranet healthcare application.
Eventually, the financial picture improved and the salary freeze was lifted. Rumors of compensation increases abounded—that is, until we pressed the issue with our CIO. Her response will always remain in my repertoire of lessons learned. Her exact quote: "There will be no increases for IT employees. If they don't like this, they can always find employment elsewhere. Technical personnel are a dime a dozen, and everyone here can be replaced less expensively and with better skills."
Stunned by this declaration, many key technical people followed our CIO's advice and found employment at other organizations. The cost to the university hospital was immeasurable in both IT talent and dollars.
Retaining your talent
IT managers today are fighting an uphill battle to recruit and retain good technical staff. And the picture will only get worse in the foreseeable future.
A recent estimate by the Information Technology Association of America projects 900,000 IT jobs will be added this year, and close to half (425,000) will go unfilled due to a shortage of trained workers. Add that to a growing sentiment of distrust among many IT workers, and businesses are faced with a talent shortage that will be hard to overcome.
One way to fight this is to retain or retrain the talent that organizations already have. But this also brings challenges.
Surveys among high-tech workers point to sweeping layoffs, pay freezes, increasing workload, and general employer apathy as major reasons for moving on. Organizations can no longer rely on company loyalty, especially among the young IT talent, as a means of retention.
Keep employees from jumping ship
So what can an organization do? Commit to a plan aimed at identifying and resolving the underlying cause for employee departures. Here's a look at some common retention techniques used by businesses today.
Challenging work assignments
It's number one among many surveys for employee exodus: Employees are demanding work assignments that are in line with their career goals. Many businesses have moved from traditional structured teams to highly dynamic project-oriented teams to give employees more opportunity to add to their experience portfolio.
Often believed to be at the top of an employee's wish list, salary is actually several notches down. Frequent surveys indicate that employees require a market wage. The important point here is that the organization must keep a current profile of what the market wage is. Many organizations will also offer performance bonuses, stock options, or premium pay for specialized skill sets as incentives.
Employees are also looking for opportunities to receive additional skill training. On-the-job training and tuition reimbursement are both good ways to address this need.
A culture that values the employee
Not enough can be said about this one. Employees want their work appreciated. They want the organization to recognize the issues and challenges they face in performing their work. From flextime, job sharing, telecommuting, award programs, and casual dress to simple praise and verbal recognition, this is the least expensive and most overlooked technique for keeping staff from seeking other opportunities.
Many employees are discouraged by ineffectual leadership and supervision. Organizations that provide ongoing management development training typically have higher retention rates.
A new technique that has yet to prove its value in the long term is the concept of golden handcuffs. This technique is best explained as a benefit with a catch.
One example is deferred compensation. For example, a sales manager may achieve bonus dollars in January that will not be paid until the following December—but he or she must still be employed in December. Another example is a company-leased automobile. The company will cover the lease payments, but the employee is ultimately responsible for the lease. If the employee leaves early, the lease will be his or hers to resolve.
Consider what is important for each of your team members. Remember that it is not necessarily money that will affect their decision to stay or to leave. Sift through these current approaches to employee retention, determine what is within your power to implement, and do your best to provide it. Remember that it is well worth the effort, because there is nothing better than the sound of a smooth running team.