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Don’t Think Retention Is an Issue? Here’s Why You Should Reconsider

Recognize This! – Traditional approaches to retention may no longer be enough.

Granted, the recover from the recession has been mediocre at best. In this reality, many company leaders have become complacent in regards to talent, assuming employees don’t have good options elsewhere so they’ll continue to stay put.

Those days are rapidly coming to an end. John Hollon, editor of TLNT, offers a brilliant summary of survey results recently released by OI Partners. Just glance at the chart below and you can quickly see the changing dynamics of retention in the workplace.

	Report Higher Turnover Today	Concerned about Turnover
Front-line workers	51%	78%
High-potentials	34%	63%
Senior executives	29%	51%
Middle managers	27%	43%

With numbers like this, it’s no surprise the same survey shows retaining talent (70%) is the top HR challenge this year, closely followed by recruiting the right talent (65%).

So, what do you do to find and retain these top people. Unsurprisingly, the survey also cites coaching as the primary retention strategy, followed by better compensation and benefits. I’m glad to hear the latter, as too many employees took a hit on their pay and benefits during the recession and have yet to see those values restored as the economy continues to improve.

Yet, I’m also concerned that improving employee recognition and appreciation isn’t discussed as a major means of improving retention and recruitment. Indeed, our own Workforce Mood Tracker Survey found that 60% of those who don’t feel appreciated plan to look for a new job (vs. only 20% of those who do feel appreciated). Recognizing employees for their valuable contributions helps them see how they contribute to achieving a greater mission, a key element of both retention and employee engagement.

On the recruitment front, I can do no better than to point you to today’s post on the Globoforce blog in which my colleague, Darcy Jacobsen, says in part:

“All the same, employer brands can’t be ignored. Different from a marketing brand, an employer brand is the impression candidates have of your company and what it might be like to work for you. They have become a critical differentiating tool for attracting candidates. In fact, according to a recent Monster/Unum study of job seekers, culture trumps all. A full 87 percent of employees said they want a company that they believe “truly cares about the well-being of its employees.” Only 66 percent of respondents rated a high base salary as very important. This is why creating a great culture, and a great employer brand as a reflection of that culture, matters so much. It lets you put your best foot forward, and attracts the best candidates to your company.”

Retention can no longer be relegated to the back burner. Look closely at what you’re doing to ensure your employees are highly valued, recognized and appreciated in your organization.

How concerned are you about retention of key employees? What are you doing about it?

3 Ways Employee Engagement Surveys Fail

Recognize This! – Don’t bother to survey employees on their engagement unless you’re willing to invest time and money to resolve difficult, deep, cultural challenges their answers may bring to light.

Sometimes, we need to air our HR dirty laundry. Let’s bring into the light of day how surveys are traditionally conducted and then acted upon. Indeed, let’s stop torturing our employees with bad surveys – especially bad employee engagement surveys.

Frankly, the survey itself is rarely the problem. The questions are usually quite good in terms of defining the information you and the organization want to learn about employee attitudes, satisfaction and engagement. Let’s look at the three most common failures of employee surveys as typically implemented today:

1) Post Survey Actions/Reactions Only Serve to Further Disengage

If you’re going to ask employees to take the time to answer your survey, then you better show them you listened by taking appropriate action. Take, for example, this story from Lead Change Group of an employee disgruntled by a poorly executed survey :

“They did ask some good questions and we shared how to make things better, but they ignored all those issues, and made us spend extra time on task forces to address cosmetics and desk arrangements. Our reward for taking time to give them good feedback that would improve efficiency and profitability – was to be ignored and given extra work on how we would decorate the department… This is so stupid! We were ignored and punished…and we really tried to help.”

Sure, it’s easier to resolve the “cosmetic” issues than tackle the deeper, cultural aspects. But if you aren’t willing to honestly look at your organization and commit the resources to address the challenges your employees bring forward, don’t bother to survey them in the first place.

2) Most Disengaged Don’t Bother to Respond to the Survey

A colleague of mine shared her story of disengagement at her last place of employment:

“I was so disengaged and disgusted with the company that I didn’t even bother to respond to the engagement survey – nor did most of my teammates. Besides, we knew they wouldn’t take action on the survey results anyway, so why bother? We’d all laugh (snicker is more like it) when leadership would talk about engagement numbers because we all knew the most disengaged weren’t even taking the survey, thereby dramatically overstating engagement levels.”

Your engagement results may actually be worse than you think, especially if you routinely don’t react appropriately to what the employees are telling you through the survey.

3) Bad Survey Timing, Especially Waiting to Survey on Engagement until the Exit Interview

Our semi-annual employer survey with SHRM regularly shows that the exit interview is the second most common way companies survey employee engagement. The obvious issue is it’s far too late to do anything at that point in time. Or, as Barbara Milhizer put it in TLNT:

“As an employee, I’m wondering why no one bothered to ask me these questions over the past 18 years? It’s a little insulting to be asked why I’m leaving for the sake of good data and action planning. Is the implication that I was expendable, but heaven forbid anyone else ever fall victim to a bad manager and lack of recognition?”

The Bottom Line – Don’t bother to survey employees on engagement unless you’re willing to take their feedback, honestly evaluate what they are telling you, and take steps to resolve perhaps deep cultural issues. If you’re not willing to make that investment of time and finances up front, you will only serve to further disengage and disgruntle employees.

How does your organization take action on employee survey results?

Top Retention Strategy: Strategic Employee Recognition

Recognize This! – A culture of recognition is one of the most powerful means of retaining top talent.

In the last few months in my travels to lead workshops with clients and to present at various HR and strategy conferences around the world, I’m hearing a repeated refrain about employee retention. In my (admittedly unscientific) survey of these large, global companies, the importance of culture as a main component of a retention strategy is once again rising to the fore.

Some companies have maxed out their compensation and cannot compete for talent based on pay alone. Others know the only real difference between what they have to offer top talent from the competition is the strength of their workplace culture as an exciting, innovative and appreciative environment. Or, as a recent Chief Executive magazine article put it:

“If the trend of rising company earnings is any indication, the momentum is likely to continue. For employers, that means what it always has: an uptick in competition for the best talent. At the same time, barely out of the recession, companies can’t yet afford to make huge investments in salary increases or large bonuses. By developing employee recognition programs, employers can improve—in some cases dramatically—employee engagement levels, retention and performance. ‘Employee recognition is a potentially very low-cost engagement driver that can have a very, very significant impact on financial performance,’ says Ken Oehler, global practice leader of engagement at human resources consultancy, AON Hewitt.”

That’s the power of strategic, social recognition done right – it’s the fastest, most cost effective way to impact employee engagement and retention. Indeed, some of our clients have realized double digit increases in engagement and retention in months, not years.

How is this possible? It’s not just telling employees “thank you.” It’s going much deeper and telling people very specifically how they and their efforts demonstrated a core value while helping to achieve strategic objectives. It’s giving employees context for the value of their efforts within the bigger picture. We all seek greater meaning in our work. Sometimes, we just need to be reminded what it is.

And when it’s done right, the benefits are stark. AON Hewitt’s Oehler continues:

“Oehler recently studied the relationship between recognition and engagement and found evidence of a strong connection. For starters, when employees were asked to name their top drivers of engagement, recognition came in at No. 2, well ahead of pay at No. 5. Aon also looked at the lag effect of engagement to sales growth and found that companies with above-average engagement scores correlated with 19 percent sales growth vs. companies below the norm on engagement, which reported only 6 percent sales growth.”

How do you differentiate your organization to ensure your top talent never want to leave?

2 Factors Critical to Building Trust (and Engagement) at Work

Recognize This! – Managers must be willing to engage in the difficult aspects of managing others in order to help all employees achieve to their best ability.

As I continue to catch up on a backlog in my readers and research feeds, I’m seeing themes emerge. One is around the importance of trust for employee engagement. Employees who do not trust company leadership will not (indeed, cannot) engage as deeply in their work. They do not give their best efforts because they do not see the value and benefit of doing so.

Just a couple of key factors to building trust in the workplace jumped out at me.

1) Managers must be willing to have the hard conversations with low performing employees.

Many were surprised at recent survey that low performers are often more highly engaged than high performers. I was not, simply because low performers too often don’t know they are low performers. Therefore, they are quite happily skating by at work. It’s the effect on the high performers who see their lower producing colleagues getting away with it that dramatically impacts trust in the organization. Or, as Mark Murphy, CEO of Leadership IQ (the company that did the survey behind these results) said, “It shows high performers that the organization is not a meritocracy.”

Managers must be willing to have the difficult conversations with low performers, not only to help them improve their own skills and productivity, but to also help build trust with top performers that leadership will do the right thing to reinforce best effort from everyone.

2) Managers must appropriately value employee effort as well as achievement.

Let’s be honest. Every innovative approach and thought doesn’t work. We know that to be true at Globoforce where our core values are Respect, Imagination, Determination and Innovation. The four together drive our success. While it’s all well and good to imagine new ideas and approaches, unless we have the determination to see them realized and the respect for each other as we do, we will never truly deliver the innovation that pushes our industry ever forward.

And yet, part of that approach means we sometimes imagine something that doesn’t work as expected. But we can always learn something from that effort and apply those learning to continue to imagine and innovate. That’s the determination needed to keep moving forward. Without validation of and respect for the effort and encouragement to find the lesson (even in the failure) and move forward, employees would lose trust in our values and our goals as an organization.

What other elements are critical to building trust?

What Does “Meaningful Work” Really Mean?

Recognize This! – Only the employee can define what is meaningful work to them. Leaders, however, are critical for helping them catch the vision.

Yesterday, I wrote about the importance of engaging in meaningful work for employees. But what, exactly, does “meaningful work” mean? As I was catching up on my (admittedly large) backlog of news and blogs in my reader, I found this nugget from the Switch & Shift blog (which is rapidly becoming one of my favorite daily reads):

“Managers cannot make work meaningful for employees. Managers, however, can shape the workplace environment to let meaningful work become possible for employees. With a context set to let meaning be experienced, employees can leverage the environment to derive meaning from their work.

“Meaningful work is vague. What exactly is it? Assuredly it begins quite selfishly. But this is out of necessity. For work to be meaningful, it is the employee who must label it so. This requires a belief that meaningful work is a desired outcome from managements’ actions. And employees believe managements’ intentions and see actions aimed to let meaning emerge.”

This reminds me of the possibly apocryphal story of the senior military leader touring NASA Space Center during the early days of the space race. The leader noticed a janitor cleaning an area of mission control and asked, “What are you doing?” The janitor didn’t reply with the obvious, “I’m sweeping the floor.” No, he said, “I’m helping to put a man on the moon.”

In this story, the employee knew and understood the greater purpose of his efforts. Keeping a neat and clean work environment would help to eliminate distractions for the scientists and engineers in mission control, thereby helping to contribute to the greater space mission. This employee knew the meaning of his work.

Personally, I don’t lead a group of strategy consultants. I help companies change their cultures to ones of appreciation and recognition.

What do you do for work? What’s the real meaning of your work?

3 Tips to Become the Manager Employees Never Want to Leave

Recognize This! – People leave bosses, not companies. Good managers make sure their employees succeed before themselves.

We’ve all heard the truism that people quit managers not jobs. If retention of top performers and key talent is a priority for you, then one of the first places you should look for improvement is in the relationship between managers and employees. This recent article, for example, points to a recent survey showing 20% of people say their bosses hurt their career. Half of employees, on the other hand, said the boss had a positive impact.

The article goes on to share common advice we’ve all likely heard before: End micro-managing and help bosses learn the art of delegation. Help bosses feel secure in their role and the importance of leading a team so they are confident and comfortable in giving team members credit where credit is due instead of snatching it for themselves.

While that advice is quite true and valuable, I’m far more interested in why these managerial tactics work. It all boils down to these three points (supported by reams of research conducted by Teresa Amabile and Steven Kramer in The Progress Principle).

Employees need meaningful work.
Busy work kills the spirit. Yes, some work tasks are menial, repetitive and just have to get done. But doesn’t mean they aren’t meaningful. Good managers help employees see the greater value of even the most menial, repetitive tasks. Help your employees see how their efforts help move the greater mission forward.
Employees need to make progress in meaningful work.
But meaningful work isn’t enough. Employees also need to know they are getting somewhere. Good managers cast a vision for the future and help employees see where they are on the path to achieving that vision. Help employees see forward progress toward big goals by recognizing them for smaller achievements along the way.
Employees need recognition of efforts and achievements that make an impact.
All of this boils down to employees’ need for recognition. Don’t misunderstand me. This is not a grab for another trophy or a gold star. Employees simply need to know what they do matters within a bigger picture. Indeed, our Spring 2012 Workforce Mood Tracker survey showed 78% of employees said they would work harder if their efforts were better recognized.

Instead of micromanaging, micro-appreciate. Hone in on what your team members are doing and recognize smaller achievements and progress towards bigger goals. Instead of snatching credit for yourself, be the one to give credit to your team for success and let the entire company see how much you all achieve together.

What other attributes do you see in good managers? What made your best manager so good?

Can Money Buy You Happiness? Find Out on Compensation Cafe

Recognize This! – Don’t ignore the importance of correct compensation in Total Rewards.

Today on Compensation Café I tackle a topic many regular readers might find unusual for me – how money can buy you happiness. The answer lies in how and for what reason you use money.

Check out my post for the three lessons I offer on the importance of correct, balanced compensation, reward choice and the importance of time – and how all this ties back to recent research showing the link between money and happiness.

Useless Unless…

Recognize This! – Don’t forget the key ingredients to employee engagement and excellence.

I’ve written a few blog posts in the last couple of months where I noticed I used these two words in conjunction – Useless Unless. Two little letters of difference, yet a tremendous differentiator.

Think of the ramifications in real life:

The fastest car in the world is useless unless you put fuel in the tank.
The best education is useless unless you put it to work.
The most talented basketball player is useless unless you give him a basketball (and committed team) to play with.
An incredibly delicious dinner party is useless unless you have friends and family to invite and share it with.
Talented, high-potential employees are useless unless they know the end goal and how to help achieve it.

What’s missing that’s most important? “E”

Encourage – We need encouragement at work. Encouragement isn’t just something to be given in tough times, but also to let people know they’re on the right track – their work has greater meaning and purpose in achieving the bigger picture.
Extoll – Don’t forget the praise. Recognize people when they go above and beyond. Shout their achievements and contributions from the rooftops. Make sure they know their efforts are noticed, appreciated and valued.
Engage – If you Encourage and Extol, you’ve taken a giant step forward in creating a work environment in which people choose to engage. And engaged employees are more productive, more easily retained and more beneficial to the bottom line.

What else is useless unless… ?

3 Lessons for Employee Engagement through Recognition from XL Axiata

Recognize This! – Learning from others’ success can enhance our own efforts for engagement.

I enjoy Abhishek Mittal’s Mumblr blog. Abhishek is a senior consultant for Towers Watson based in Singapore. Recently he shared a case study on XL Axiata, an Indonesian mobile services operator and division of Axiata Group. In the case study, Xl Axiata explains four key steps they took to create an engaging work environment for employees, including a Performance-Based Culture:

“XL Axiata knew that if it wanted the employees to display the right behaviours, it had to recognize and reward these behaviours. The leaders shaped a culture where people and performance are talked about in the same breath. Employees who were creating value for the company were being recognized through company-wide emails and there was a focus on celebrating small successes in the long journey to achieve the vision. It also placed a higher emphasis on differentiating rewards based on performance. Mittal says,These initiatives helped employees build a clear line of sight to the company goals and sent a clear message that the company values high performance above everything.”

From this one focus alone, I see three clear lessons for employee engagement:

Recognize and Reward the How not just the What
Results (the What) can be achieved in many ways, not all of them positive (think Enron or any of the other recent scandals were the end was more important than the means). By focusing recognition and rewards on the right behaviours, XL Axiata is reinforcing that how the work is accomplished is as important as what is accomplished.
Celebrate progress on the way to the big win
While everyone must understand and work toward the ultimate vision and “big win,” small successes and progress along the way make the big win ultimately possible. Research conducted by Harvard Business School and reported in the book The Progress Principle by Teresa Amabile and Steven Kramer proved the single greatest motivator for employees is making progress in meaningful work. Doing so increases engagement.
Offer multiple, differentiated awards
Recognition and rewards must be differentiated based on several factors including level of effort, contribution and results achieved. Offering the same level of recognition to someone who came up with an innovative idea that could transform product direction as you also offer to someone who contributed as part of a team to a lesser initiative merely serves to demotivate those who achieve great ambitions. Offering differentiated awards (awards at various levels) ensures both proper recognition and reward activity as well as eliminating any concerns around recognition becoming expected or run-of-the-mill.

What major initiatives has your organization undertaken to encourage employee engagement?

Perform 4% Better than S&P – Engage Your Employees

Recognize This! – Companies that treat employees well outperform the S&P Index.

Creating a work environment in which employees choose to engage directly impacts the bottom line. Companies who treat employees well have returns at least 4% better than the S&P Index, year after year.

That’s a bold statement to make, yet the results are proven directly in the US Stock Market. Companies in the Parnassus Workforce Fund (as explained in this Fast Company article) include many of the “100 Best Companies To Work For” as well as others that “genuinely cared about their employees as people, not just hired hands.”

The results are indisputable In eight years, the fund has had a 9.63% annualized return (as compared to the S&P Index earnings of 5.58% in the same period). Moreover:

“Another compelling statistic buried in the Parnassus prospectus: Over the past five years–the height of the Great Recession–the average annual return on the Workplace Fund was an incredible 10.81%. The S&P Index for the same period was just 3.97%, a 6.84% difference. [James] Dodson, [founder of Parnassus Investments and portfolio manager of the Parnassus Workplace Fund], believes the wide gap in performance is easily explained: ‘I think what happens when you have a contented workplace, people are willing to put out more effort to improve operations during really difficult times. While I think every organization has their ups and downs, the downs are not as pronounced because everybody pulls together to try to get through the crisis. And, of course, this consistently more engaged performance inevitably reveals itself in the firm’s bottom line.’”

Employee engagement matters. Caring about employees as people and not just human resources makes a tremendous difference to organization success. What can you do?

Give them something to believe in and strive for.
Make your mission and values more than just a statement. Make them integral to what every employee does every day in their own, unique, job roles and functions.
Recognize and reward them for significant accomplishments and behaviors.
Help employees understand when and how they personally contribute to achieving the mission while living the values by recognizing and rewarding them for doing so – frequently and in a timely way.
Empower them to be the caretakers of your culture.
Show you trust employees by encouraging them to also recognize and reward peers and colleagues when they see others living the values and achieving the mission. The culture must be owned by all to be relevant and real to everyone.

Do you believe in the power of employee engagement to drive bottom-line results?

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