Small Business Times recently ran an article about the Vistage CEO Confidence Index showing a decline in optimism among more than 2,000 CEOs of small to mid-sized companies across the United States. The CEO survey indicated that the most important success factors for CEO’s in 2007 is recruiting and retaining talent, beating out other important factors like cash flow, the economy and rising health care costs.
The competition for skilled workers continues to increase, and the recruiting and replacement costs associated with turnover can be as high as two to three times the annual salary of a given position. Companies are now turning their attention to investing in their people, given the high turnover rates many companies have been experiencing.
I used to work for a company that spent more than $1 million annually recruiting salespeople in order to maintain about 150 reps in the field. The company and its sales management team accepted their 100-percent plus turnover rate to be a reasonable part of doing business in the 21st Century.
It is a well known fact that it costs a company much less to keep a customer than it does to get a new customer. The same holds true for employees. By putting our people first and investing in their careers, we can develop their talents and maximize their potential.
I have found that treating people as unique individuals by understanding those specific needs and motivations and finding ways to tap into that potential is crucial to retaining your talent and propelling your company to greater success. Let’s consider the concept below:
Fair vs. same
Fair does not have to mean “the same.” Many of us have experienced this exact concept in dealing with our own children at home. Employers need to look at each employee as an individual with his/her own special gifts and set of circumstances if they’re going to retain their talented employees long term. Understanding and meeting the unique needs of all employees is a key to unlocking their potential and retaining them as long term productive employees.
Real life example
This company employs a team of account managers, all working for the same department and manager. All of the team members have similar production goals and customer satisfaction goals with quarterly tracking and measurement of these goals. Yet, the two people profiled here have different values, concerns and needs.
Employee # 1 – Mark, a long time employee with 30 years in the industry, is committed and loyal to the company. He understands the business very well and is also involved in mentoring new employees and managing some of the largest clients for the company. Most days he is in the office by 7 a.m. to get an early start, even though the office officially opens at 8 a.m. He also puts a few hours in over the weekend on a regular basis to keep up on his administrative duties. Losing Mark would be a huge loss to the company, due to his dedication, knowledge, customer relationships and workload productivity.
What the company uniquely does for Mark:
- Supplies a work-athome computer to access and manage e-mail and files from home since he works easily more than 50 hours per week and being able to do some of his follow up in the convenience of his home office is a welcome gift.
- Allows Mark the flexibility to schedule his day. He is capable of determining his work responsibilities and getting things done. Occasionally, he enjoys the ability to leave by early afternoon when his workload is lighter. This typically happens once or twice per month.
- Allows Mark to take up to 2 weeks of paid vacation in October to go hunting, his passion, even though it’s one of the company’s busiest months of the year. Most vacations are held to a minimum during this time for other employees, but the other account managers are happy to provide coverage to him knowing that this is the one thing that is most important to him. They know that they can rely on him to provide back-up when they are on vacation as well.
Employee # 2 – Susan has been with the company for about the same amount of time Mark has and has a 15-year history of work in the industry. She has demonstrated her talent and commitment to the company through her high productivity results and does a great deal of the initial training of new employees around product and system training. Susan is a new mom and because of that, she values very different things than Mark does.
What the company does uniquely for Susan:
- Due to daycare logistics and costs, Susan was looking for more flexibility in her hours and schedule. She now works from 8:30 a.m. to 5 p.m. with a half hour lunch rather than the usual hour lunch that the rest of the department takes.
- Susan works a four-day schedule and agreed to reduce her pay to four-fifths of her full-time salary to do this. She typically takes Thursdays off during the week. Susan remains flexible, and if client appointments or workload necessitate that she work on a Thursday, then she will simply take a different day off during that week or a slower time during that month to make up for working that day.
In summary –A win/win for all
Two people, same job, similar daily productivity, same client satisfaction expectations, and yet, the company found ways to meet their individual needs and lifestyles. In return, the company gets each employee’s dedication and commitment to meeting their goals. Each employee goes above and beyond the call of duty to accommodate the company and their customers in return for the unique accommodations each was given by the company.
Why it works:
- Expectations and work guidelines have been set and shared with each employee, and both employees have proved themselves by their stellar past performance.
- Measurement tracking is in place and reported quarterly to ensure accountability.
- The actual job description and duties of the job are well documented, but telling each person how to do their job respective jobs is entirely up to each employee.