Dear Money’s Not the Object:
There is good news. Many studies have revealed that, for most companies, compensation is not the primary driver for employee retention. According to a recent BlessingWhite Inc. study, “The top reason employees give for jumping ship is: ‘My career. I don’t have opportunities to grow or advance here.’ On the other hand, the top reason employees worldwide give for staying with their employer is: ‘My work. I like the work that I do.’ Career is the second-rated reason people stay.”
So how should you use talent management to retain top talent in a cost-efficient way? First, create talent management programs that foster career growth. Second, ensure employees are fairly evaluated and compensated.
Let’s take a look at some of the different areas of talent management and show how they can contribute to top talent retention.
Learning and Development
- Career paths using a common competency model: Documentation and resources around “career pathing,” coupled with a common corporate competency model, will help employees own their career growth and feel supported by their company and manager.
- Support 70/20/10 development: Many companies utilize close to 100 percent class-based learning opportunities, while studies have shown that the most effective learning programs utilize only 10 percent class-based learning, coupled with 20 percent relationship-based learning (such as mentors) and 70 percent experiential learning (such as stretch assignments or project-based work).
- Accelerated leadership development: Giving top talent accelerated leadership development opportunities keeps them engaged.
- Top talent identification: Utilizing talent reviews and succession planning to identify top talent early ensures focused attention on your highest performers and high-potential employees.
- Long-term development planning: High potentials like varied experiences, so taking the long view with your top talent when planning succession will help to increase retention.
- Fair, objective and differentiated performance management/compensation: Unfair or undifferentiated performance management and compensation processes will cause your best talent to feel underappreciated, so make sure you get this one right.
- Manage underperformers: Keeping underperformers around will demotivate your top performers and keep them from maximum contributions.
- Support for internal mobility: Keeping a talented employee from moving to a new position to learn something new is a sure way to prompt that employee to start looking for a job elsewhere. Ensure your leadership and management support the idea of internal mobility.
Keeping these principles in mind when designing your talent-management strategies and processes will have a much larger impact on retention than simply increasing salaries, allowing you to win the war for talent against your larger competitors.
SOURCE: Andy Rice, Newman Group, Los Angeles
LEARN MORE: For more on defining talent management, please click here.
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The information contained in this article is intended to provide useful information on the topic covered, but should not be construed as legal advice or a legal opinion. Also remember that state laws may differ from the federal law.