Key worker retention is the #1 business challenge
A recent issue of Entrepreneur Magazine reports on a survey conducted in conjunction with PricewaterhouseCoopers to determine the biggest challenges facing entrepreneurs. The data showed that 73% rate “key worker retention” as their number one challenge. The most interesting thing about the survey is that this topic got almost twice as much as number 2, “develop new products and services” with 38%.
In addition to reporting the data, the magazine provides a sidebar on how to tackle the retention problem. The headline is great, “Make Your Employees Matter,” but the content is all about offering competitive retirement plans and enabling key employees to financially share in the growth of the company. The problem is that focusing on money doesn’t retain employees because it doesn’t make your company unique. Anyone can offer competitive wages and benefits, making it easy to jump from one job to another for more money.
Silicon Valley companies discovered this in the late 1980s and early 1990s, when the technology began to grow. Workers viewed every employer in the Valley as one big company—jumping from company to company based on the challenge of the job or loyalty to someone they enjoyed working with. It is still common in the technical realm for entire teams of product development people to move together to another employer. They do this because of the working relationships and partnerships they have developed.
A few years ago, the Gallup Organization conducted the largest study ever conducted on employee problems, interviewing 30,000 successful managers about their techniques for keeping employees satisfied. They discovered 12 workplace characteristics that good managers consistently use to retain and motivate employees. Guess where the money or any kind of financial reward was on that list? Give up? It wasn’t even mentioned.
This research resulted in an excellent book by Marcus Buckingham called “First Break All the Rules”. The title derives from the fact that all the management basics he learned in B school aren’t what work for really great managers. The book revealed the twelve most important rules to use. Are here:
1. Know what is expected of them
2. Have the materials and equipment to do the job well
3. Having the opportunity to do what they do best every day
4. Frequently receiving recognition or praise for good work
5. Have supervisors who care about them as people
6. Being encouraged to pursue self-development
7. Make their opinions count
8. They feel that their work is important to the mission/purpose of the organization
9. Have co-workers committed to doing quality work
10. Have a best friend at work
11. Talk about your progress regularly
12. Have opportunities to learn and grow
Based on this research, Buckingham observed that “employees don’t leave companies, they leave managers.” Think of the best job you’ve ever had. Wasn’t it great because you enjoyed and respected your manager? Didn’t you have a great relationship with that person and the others you worked with? Loyalty to a job is really about loyalty to the people you work with – they are the logical human connection.
So yes, the Entrepreneur headline is correct. Take on the #1 business challenge “Making Your Employees Matter” but in a very personal way: by breaking the traditional rules.