Identifying, recruiting and retaining talent
You often hear businesses saying; ‘We struggle to hire talent’; for me, this is the same as a high street store blaming the internet for their demise. Too strong? Look inward before you blame the outward environment. We are living in a competitive world, probably none more so than when it comes to recruitment. Employees want more than just money from a job; they want satisfaction, they want to feel valued.
Let’s face it, we spend more of our lives with our work colleagues than our loved ones these days. (Whist I could carry on about work /life balance and the importance of getting that right for productivity etc, I’ll save that for another day.)
Your people are your business, they are absolutely critical to your success and importantly, your ability to capitalise on the opportunity afforded by digital transformation. What’s most frustrating about the ‘struggle to hire’ mantra is that most companies are sitting on a gold ’mind’ of talent, they just don’t enable it. Create the right environment, the right culture and you’ll probably find you already have most of the talent you are so desperately looking for.
“It doesn’t make sense to hire smart people and tell them what to do; we hire smart people to tell us what to do” – Steve Jobs
The value of existing employees, when unleashed through a change in culture, is often your biggest untapped asset. The goodwill of your people, when enabled, is more valuable than any cash on your balance sheet.
Invest in people
If we look at the relative cost of training compared to the cost of recruitment, not only the agency fees (ten per cent – 15 per cent) but the management time to hire and the on-boarding of company knowledge, all told it’s probably just shy of 40 per cent of their first year’s salary. When you consider that in the UK the average employee stays for just 4.5 years in the same job you can start to see how important creating the right culture is just to retain the gold nuggets you already have.
Training budgets are often the first to be axed when there’s a squeeze, but the desire to hire replacements remains, and at a cost of 40 per cent of salary, it may be a false economy. Imagine if you invested just five per cent of an existing employee’s salary in their training and development every year? If you could increase the average retention time by just 12 months, you’re still better off.
CFO: What if we invest our employees and they leave? CEO: What happens if we don’t and they stay?
“Although 90 percent of respondents perceive digital transformation as being important for their company’s overall business strategy, targeted skill development is a rarity. Only 16 per cent of respondents had set up a dedicated recruitment or training program to build up the skill base needed to shape the digital future of their company.” – Technical University of Munich Survey of Business Leaders
Selling the dream
Many businesses are fantastic at selling their ‘entrepreneurial spirit’ and ‘fantastic working environments’ but fail to follow through in the actual delivery. Enabling it, making it real, is hard but crucial to retaining the right people. And, to be clear, it’s not about painting the walls
a bright colour, having a pool table and scattering bean bags.
Ensure the work experience actually matches the promises made when hiring. Much like the digital transformation problem you are trying to solve,
ensuring the expectations of new hires (and existing employees) are met during their time employed by you will drive retention. Any prospective employee will do their research, ask their network; What is it like to work there? They’ll use ‘review’ sites like Glassdoor to garner the opinion of others.
Especially for the new and next generation workforce, finding a job mirrors that of their e-commerce experience. All of the same principles apply; you really need to walk the walk, not just talk the talk, and live up to their expectations.
“Train people well enough so they can leave, treat them well enough so they don’t want to.” – Richard Branson
When I hear the words ‘We’re struggling to hire the right talent’, I immediately conclude that the business culture needs to change. I understand that sometimes the location of the office is less desirable, there are seemingly more ‘cool’ places to work. But the reality is that people will
travel and stay if the environment’s right.
“People don’t leave bad jobs, they leave bad bosses (businesses)”
First and foremost, define the company vision: nothing empowers an employee more than allowing them to understand exactly how they can help achieve the company’s vision, no matter how small a role they might play. From call-centre staff to on-the- road engineers to senior management, imagine if every single individual in your organisation was making incremental improvements towards your vision every single day?
If the vision is clearly articulated you will attract and retain the right people. They’ll know what they are signing up for, they’ll know how their role plays a part in achieving that vision. Everyone will have the ability to challenge business-as-usual, providing ways to make improvements.
Create a culture that’s transparent, open and connected. One that:
*Fosters an individual’s development
* Empowers your network of colleagues to act and feel valued
* Provides autonomy and a shared, collective accountability
* Measures and rewards output not execution
Saving the best for last… And the real kicker, all this will bring efficiencies to the business, not just in terms of cost lines in the management accounts but in terms of the effectiveness and output of every single employee. If you could get just ten per cent more from everyone – not by making them work longer hours but by removing wasted effort, you’d be in an amazing place. And ten per cent, in my view, is conservative.
Marcus Wareham is strategy director at digital product design agency Mubaloo.