#440  from Innovative Leader Volume 8, Number 12          December 1999

Low-Cost Steps to Keep Your Best Employees 
by G. A. "Andy" Marken

Mr. Marken is President of Marken Communications, Inc. in Santa Clara, California (phone 408-986-0100; email marken@cerf.net).

A recent on-line newsletter from a recruitment firm mentioned that, because of the continual turnover of senior managers, even non-tech oriented companies were beginning to offer signing bonuses, salaries of $100,000+ and stock options for middle managers.  In addition, a newspaper career counselor recently advised a reader that unless you had an employment contract, nine months was long enough for a job.

It was noted that, if you move, it should be for more than just money.  It should be for a better company fit, for skill enhancement and that the move match your career game plan.

Employment rules today are that there are very few rules.  There's no longer a stigma attached to people who have had three or four job changes in the last few years.  That's good news for people who want to "shop."  It's bad news for companies.

Sixty to eighty percent of the organization's inventory leaves through the front door each evening.  Every time part of that inventory doesn't return, it costs dearly to replace the individual.  Since no one has unlimited staffing budgets, employee retention is the best way to keep your largest cost under control. 

The primary motivation for an individual to job hunt is seldom simply a bigger paycheck. There are low-cost efforts you can undertake to retain the people you want to keep.

1. Flexible hours and telecommuting

Increasingly, managers are realizing that flexible hours and telecommuting are the most cost-effective ways to retain present personnel.  The combination of flex time and flex place are inexpensive and convenient. 

Many times, it also makes better use of your overall resources--physical and fiscal.  Mangers are realizing they can focus the best possible person for the job, regardless of where he or she lives.  They eliminate the high cost and personal disruption and concerns that surround relocation.   This is especially true for companies in areas where housing costs and daily commutes are more than some people want to confront.

With telecommuters, companies also don't have to pay for office space, parking and commuting costs.  In many instances the savings can be substantial.

More than 60% of the nation's firms have increased the number of telecommuters over the past two years.  And, according to AT&T's National Survey of Teleworker Attitudes and Work Styles, 60+ % of the respondents felt telecommuting was positive for their careers.  Sixty-two percent found no difference in working at home, and 15% felt more connected to their workgroups.  Seventy-one percent were more satisfied with their jobs after they began working at home.

In making the move, companies must outline the location and hours of work, who owns the equipment and who's responsible for repairs.  Many firms find that with Internet connectivity people are not only more productive when they work off-site, but they actually put in longer hours.  The individual's commute is only 15 steps rather than 15+ miles and people can focus all of their attention on the task rather than routine office interruptions. 

2. Praise

It sounds extremely simple but with reduced staffs, increased workload and compressed time schedules, it is easy to forget compliments.  While some people are self-reliant and self-assured, it is amazing what a few well-chosen words can do.  People need to know that their efforts for the company are recognized and appreciated.

This is especially true for junior people who may be taking on projects or activities for the first time.  Each success should be acknowledged so the individual will grow and have the confidence they are growing personally and professionally.

But don't overdo it and don't spread the praise around so much that it becomes meaningless.  

3. Employees training employees

Firms spend hundreds of thousands, or even millions, of dollars each year conducting formal training sessions.  For some of the skill sets, formal training is a must. 

However, organizations are finding that itís not only more cost-efficient but also more effective to have employees teach each other. The company's most valuable resource is its people; leverage their experience, capabilities and technical/work expertise.   Mentoring allows seasoned professionals to share not only theory, but also "real-world" experience.  This is often more valuable than classroom instruction.

It helps both the trainer and the trainee.  The trainer gains recognition for his or her technical or business expertise.  Trainees gain insights into practical applications and knowledge they can confidently and immediately use.

4. Clear career paths

Let employees know the company's and department's plans for the next one, three and five years.  Identify opportunities for people.  Explain whatís required for them to move forward in the organization.  Without a clear-cut understanding of what they have to do to advance, people quickly become demotivated.  At that point they begin looking for "better" opportunities.

5. Work with cutting-edge technology

Every organization advocates letting people work on special or new technology implementation projects.  But these programs and projects are often given to the same few "stars."  The high-potential types get the projects because management wants to make certain the effort succeeds.  As a result some members of the team never get the chance to stretch themselves and grow.

If you find this occurring, use the approach with teams made up of senior and junior personnel.  Keep in mind that even your best staff members aren't good at everything. Sometimes they can learn from new members in the team.  As individuals develop a broader range of understanding and expertise let them lead teams on new projects.  This keeps people from being pigeonholed or left out so they cease to grow. 

6. Shield your people

Whether clients are internal or external, one of the managerís most important jobs is to control the interaction between "clients" and staff.   Managers should be the lightning rod that shields others in the team, allowing them focus on their work. 

Because your work is an inexact science at best, occasionally things will go awry despite the best plans and individual efforts.  When this happens, itís the manager's responsibility to not only defend staff personnel but also take the heat.  Once the problem is solved or resolved, the individual(s) involved can be counseled on how the situation could have been avoided or corrected so the problem doesnít come up again.

7. Emphasize benefits package value

If your company offers good benefits, make certain employees know the value of those benefits above and beyond their weekly or monthly paychecks. Depending upon the company, benefits can be 20-30 percent of total compensation.

In addition, you may want to consider adding or offering benefits that cost very little or nothing.  Non-cash incentives can be a key means of retaining people.  The right mixture of these incentives often helps keep employees and often keeps them from leaving just for an increase in salary. Days off with pay at the completion of a major project, paying for attending conferences and educational/informational seminars, flex time, child care, wellness credits, corporate or departmental health club sponsorship and similar benefits can do a lot to keep people from considering job offers.

8. Supportive culture

Recognizing birthdays, anniversaries and special occasions as well as impromptu parties for the completion of a major project is a cultural activity that says "you're important" and "you matter."  Little things can build big loyalty.

However when this cultural support comes down as a corporate edict itís often ineffective. 

9. Small gifts, cash prizes

Small, impromptu gifts such as sporting event tickets, free meals, theater tickets and on-the-spot cash awards of $25 - $50 is a way for department mangers to recognize an individual's accomplishments or contributions.  But since incentive awards have become commonplace, they can often lose their effect.  When the awards are given, combine them with public recognition. 

The football tickets or dinner aren't important to professional staff members and certainly won't keep them from taking a better job offer. However, receiving the recognition in front of their peers can build team and organization loyalty.

When the big offers come, they can force people to consider a move.  It's up to corporate and department managers to use as many of the low-cost incentives as possible to keep people from looking for a new job or cut off overtures at the outset.  Low-cost incentives should be part of your total compensation program.  Don't take them for granted or you'll continually be hiring and training new people.  Constant replacement is far more expensive than the incentives.

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