The concept of “retention” no longer works
The concept of “retention” is no longer effective. This is particularly the case for younger individuals, and in the technology industry. We need to acknowledge that people choose where to work, and they stay because they choose to work there. The concept of “retention” no longer works – indeed, I would go so far as to argue that the concept runs counter to how young people want to be treated.
In the past too many companies have treated retention almost as if it is a barrier to stop people from leaving. However, we know that there is almost no unemployment in the hi-tech sector, and our employees receive regular job offers from other companies, in most cases about one per week. And remember, no company today competes just with their local competitors for talent in their town or city- with options for people to work from home or remotely, every company is now in a global competition for talented individuals.
Those of my parents’ generation, were used to the “employee contract” where employees would stay for a long time, perhaps their whole careers in one company. For better or worse, both sides have realized that the world has changed. Whilst this means employees may face greater insecurity at times, in sectors such as technology which have almost full employment, it means they are in a strong position to choose where they want to work. If a company is not providing what it is they are looking for, they will quickly move on.
Customizing your value proposition to young people’s needs
Particularly for services organizations, such as Belatrix, our differentiation lies in the skills and capabilities of our people. While we also create intellectual property (such as software that we can re-use between customers to help speed their development process), ultimately it is a people business. We are only as good as the people who work with our clients on a day-to-day basis.
Much has been written about how younger generations, millennials and generation Z, have different expectations of the workplace. I believe that one of the most overlooked parts of how these generations want to be treated in the workplace, is that there is an expectation from youngsters that a company’s value proposition is customized to their needs. It means creating a highly competitive employee value proposal adapted to different locations and as much as possible to each individual employee.
To do this effectively, and at scale, means investing in better understanding people. It means talking to people and using surveys, both internal and from organizations such as the Great Place to Work, to learn more about the interests and needs of employees.
Training is a key part of developing this value proposition. This is because, via training, we’re enabling people to invest in their careers and their personal equity – by that I mean, that it helps people increase their net worth on the market. In practice this translates to providing training from aspects from technical skills to managerial and leadership capabilities, to soft skills. It represents a significant investment on the part of employers.
Make building your culture your number one priority
The question for organizations today is how do you massively customize that value proposition to appeal to young people? How do you build a high-performing culture, that provides people with “purpose”, and then maintain this culture as your organization grows rapidly? These are many of the questions that I and our leadership team have been grappling with. I have previously referred to this as my “biggest managerial challenge” and about how I have been informed by the authors, Neel Doshi and Lindsay McGregror, and their book, “Primed to Perform”. The authors examine the science behind a high-performing workplace. A high-performing workplace does not simply occur- but is rather the consequence of specific actions a company can take. For example, we’ve adopted their broad motivation model called TOMO (Total Motivation), which examines the different, direct and indirect, motivations that employees experience.
Empowering people is not as simple as providing the right to make decisions
While many organizations talk about “empowering” people to make decisions, and giving people throughout the organization the ability to judge what is the best course of action. In reality, it’s much more complicated. As Don Reinersten points out in his excellent presentation, “The Leadership Challenge of Decentralized Control”, organizations need to consider individual decisions within their own frame of reference – whether those decisions are at the “local, product line, sector, or enterprise” level.
For example, he highlights how we often hear how senior managers complain that they can’t find people “with initiative”. But we forget to ask if these people have the necessary information to make those decisions – if you have provided them the space to take the initiative, but have centralized your information flows, individuals simply will not be in a position to make those decisions, and will understandably shy away from them.
Your value proposition for young, talented individuals, will help set you apart from the competition
For all the discussion about how young people want something different from work, and in many cases the criticism they receive, I believe most young people simply want the chance to do good work, learn, and get ahead in life – like people always have. What has changed, is to achieve that modest goal, they need to demand more from employers. No longer having a job for life, means they need to be constantly investing in their careers and their capabilities. As employers, our value proposition for young people needs to reflect this new reality.
This article was originally published in Forbes.