Back in 1997, McKinsey wrote the ‘War on talent’. They observed and predicted that hiring and keeping the best people was the biggest challenge for business. But, since 2008 and the (almost) global recession, the war seems to have been more easily fought. The balance of power shifted. Suddenly, employers had the upper hand and they had a choice of candidates who would work under pretty much any conditions.
Six years later, in 2014, the pendulum is swinging back in favour of the employee. Suddenly employers can’t find high calibre candidates quickly enough. Wages are rising and there are murmurs of discontent amongst existing staff. What’s happening? Well, the economy has improved, there are more jobs and employees now have more choices. In short, we’re back in the late 90s!
The big question is: what do we do about it? I suggest that, as employers, we need to change our frame of reference for how we look after our existing people and how we go about recruiting new talent. These are my six recommendations for retaining and hiring the best people in today’s environment.
1. Pay well
There’s no getting round this. Unless you offer something unique that will enable an employee to go and earn at a much higher rate later in their career, you just need to pay well.
The things to consider when setting pay include; what you can afford, what your competitors are offering, how the whole compensation is made up, how important this hiring is for you, how difficult it is to find the right person for this role, and how urgent the hire is.
What you can be sure of, though, is that you need to be generous at the start, and continue to be generous in pay reviews (assuming the candidate is performing well) if you want to attract and retain high quality people.
For many decades, the reality has been that people’s careers have spanned multiple employers. This means that people are keen to add to their own value. This also means that they want, and need, to be constantly developed.
This can be seen as a double-edged sword. You train people well and then they leave, only for someone else to benefit from their enhanced performance and output. The problem with this view is that, unless you offer development, you simply won’t attract, let alone retain, the best people.
A better way to view this is to make sure that you work hard to make your business the very best option so that your people just don’t want to leave. That way, you’ll see a great return on your investment in development.
3. Provide opportunity
It’s essential to provide both opportunities for promotion and new challenges for your people. The moment that any of your talented folk believe that there’s nowhere for them to progress within your company, you’re in trouble.
Ensure you have frequent conversations and reviews about performance with your team in readiness for their next role. Invest time in this and in genuinely trying to help people build great careers in your company and you’ll find that loyalty and longevity of tenure increase dramatically.
4. Give meaning
Everyone feels the need to gain meaning from work. For some industries, this is inherent (such as in the public sector, or in charity work). However, most of us sell widgets or business services that may lack ‘soul’.
It’s worth thinking about the many ways to give meaning to work. One way is to create a mission that galvanizes everyone. For example, you could aim to be the number one company in your field. Or, you could strive to achieve 30 percent growth per annum. Perhaps you could create the most admired products in your market. Whatever it is, you need to win hearts and minds.
5. Have fun
And finally, you’ll benefit enormously by encouraging a workplace to be filled with fun and laughter to accompany the hard work. It’s amazing how many people stay in a business, being paid a little less than elsewhere, simply because they enjoy being there. They’re allowed to laugh and enjoy the company of others.
2014 has brought more jobs, and, in turn, more choices for employees. It’s employers who need to work hard with their recruitment now, if success is their goal. Steve Jobs recognised this when he explained, “the secret of my success is that we have gone to exceptional lengths to hire the best people in the world”. The truth is that all employers need to find out what these exceptional lengths are, if they too are to attract and retain the best talent.
About the Author: John Southwell is MD at etsplc.com