If the ‘Best-Fit’ people are part of your team, then magic is just round the corner!
It was a mild chilly Delhi afternoon and I was seated alongside the MD and CEO of a reasonably large sized Design and Manufacturing company focused on Chemical Industry plants. A family owned business, now being run by the third generation with a mandate to ‘professionalize’ the firm, I had been consulting them for a while and most of the key staff knew me well. They had a niche in the market place with limited competition and their key was in the design skills of making very efficient tailor-made equipment for this sector. In some ways, the knowledge and experience resided in the “heads of their engineers”.
We had just started sipping some warm tea when PK – the General Manager of Engineering – walked in with some fret and nervousness written on his forehead! I tried to calm him down, ordered for some tea and encouraged him to share his anxieties. He pulled out a piece of paper from his pocket and passed it on to his CEO – “This is the 5th resignation in as many months! I just can’t understand what is happening?” Some nudging revealed that those who had left were from different cadres and backgrounds and not all reporting into the same line manager (just to make sure the popular adage that “people leave their managers and not their company” – had not kicked in this case-as yet!).
When you don’t see a common pattern in the people churn, it is very difficult to separate the signal from the noise! Managers often get mislead by common hearsay or/and perception– we are not up to the mark in salaries, managers are insensitive to workers’ needs, top management is invisible, work is not interesting…and so on. However, while addressing this problem one needs to peal the onion layer by layer. No one solution can fix all problems in one go. One has to prioritize – implying that who are the ones that the company needs to desperately retain (and indeed they are deserving in their own right) and who are the ones, one can afford not to regret too much if they were to be let gone.
Finding and retaining top talent has always been a challenge ever since industrialization came into being. It is only that the nature was different then – there (particularly in manufacturing) was union activism, salaries mattered, and overall wellbeing of workers in factories (like health and safety as well as social security like Provident Fund and ESIC) was a determining factor. I am a product of that era – where many new entrants would ask the potential employer if they had a PF contribution available as part of salary ‘package’.
Cut to a few decades later (post liberalization) when new age tech and knowledge driven ventures came into being – these included IT, Pharma and Biotech, Management Consulting, Banking and Financial services, Retail and the likes – where the talent acquisition revolved around attracting the best from top engineering and B Schools. The demands from these aspirants were different – salary asks were (and are increasingly) almost incomparable with other traditional industries, ‘perks’ and stock options matter, designations and job titles seem to make or break societal perceptions (especially if you are a potential groom or bride!). PF and ESIC do not matter as significantly (“who will trust the government with your money until you turn 58 years?!” – a common response of a new employee).
Today’s generational priorities are different – ‘settle’ down quickly – get a good car, buy a house with 20 years EMI, get married to a partner of choice (and willing to share household chores with career), build capital and cash at neck breaking speed so that one can afford to retire quickly and plan long vacations when one is fit and able to enjoy and pursue what they like to do instead of being forced to do! All legitimate asks from their perspective – surely, having seen their parents and grandparents struggle to earn, save and in many cases, forced to have a second career or an extended work life beyond retirement, they don’t want to see themselves repeating the same (mistakes??!!). By the way, when I mention of generation gaps, earlier 25 years was a generation gap. Now, one engineering batch is a generation gap! The incoming batches’ aspirations are different than the ones’ of the outgoing batch!
As aspirations in the potential talent market changes, so do the challenges of the hiring firms and their leadership and HR. In recent years, this has come to haunt a number of ‘Tech Startups’ – where one may be able to attract some select bright individuals initially based on the ‘kick’ they get out of being associated with a technologically challenging product – but very soon the romance crashes! For a number of reasons – too many tech challenges to overcome, product roll-out delay, go- to -market strategy not in place/delayed, funding challenges, boot-strapped money running out, founder team differences, blurry vision….and the list can be unending!
But in general, some very oft revealed reasons include:
- Expectations versus actual work assigned at the work place not matching – very commonly observed in cases of fresh graduates and staff with 1-2 years’ experience
- Several surveys by professional HR consulting companies and Institutions/Councils has found that although people join companies for rational reasons (better compensation, benefits, and career opportunities) they stay with the company for emotional ones. Sense of connection with the firm’s mission being prominent among them
- Often what employees want for their career is not what the company wants for them!
- Less than 25% departing employees express their dissatisfaction to the manager – and it is under the radar and often too late to intervene!
- Immediate manager not competent enough at coaching and feedback
- Career opportunities limited/not valued/not listened to/not paid well
- Work-life balance has gone for a toss
- Lack of trust or confidence in the senior leadership
From my experience of Management Consulting and Mentorship to senior professional managers/leaders and startup founders, I have tried to put together a list of things that organizations can attempt (especially the young ones which are in the process of setting up/scaling) with the hope that they will attempt to implement some of these and discover what needs to be tweaked for their specific needs.
- First and foremost, Founders and top leadership must recognize that in today’s world it is talent / people who “make or break” organizations. People cannot be treated as “Plant and Machinery” that you can replace overnight and it will start producing results!
- Look for the ‘Best-fit’ talent rather than ‘the brightest and best’ people. Like I often tell my colleagues, 11 Sachin Tendulkars in the team is sure recipe for failure! You need fair balance of various talent and competencies. And they must ‘fit’ into your organization’s Vision, Mission, and Culture
- Make sure that the organization’s mission is crystal clear and widely understood
- In ventures where creativity, innovation, and intellectual property/capital equal competitive advantage, the most effective leaders devote at least 40% to people coaching and mentoring the next layer of leadership and retaining top talent
- Be clear of what talent you are looking for and retaining – one, is to get that clarity and next, is to be able to write out a very thorough Job Description (and it better be initially drafted by the hiring manager and not HR)
- Emphasize on ‘skill based’ rather than just experienced based – this includes Mind set, Tool set and Skill set relevant for your organization. In tech startups, a problem solving mindset with entrepreneurial sensitivity is very valuable
- Never hesitate to hire somebody better than yourself – don’t perceive them to be a threat to your position – they only help in making you a better leader!
- It is advisable to put in place a robust and clear HR policies in place ASAP and in a manner that staff understands and is not ambiguously left to them to interpret
- Craft an appropriate compensation plan. Not everybody works only for money. In young startups, it is good to be sensitive about what drives top talent to perform and deliver their best. Consider incentivizing them in a tailor-made fashion – it may seem difficult, but not impossible – worth experimenting
- HR must build a roster of ‘top / valuable talent’. While HR is the custodian of talent, retention is largely the onus of the concerned line manager
- Make senior managers and team leaders are accountable for attracting and retaining key talent. It must be part of their KPIs. And it must start from the top!
- There needs to be great clarity of what ‘success’ means to the organization and how they will go about achieving it
- Performance Management Systems must focus on both; business results and people management goals
- Establish ‘early warning’ systems. This could include ‘listening tours’ in order to get the pulse of the people. Founders/top leadership must consider having shared lunches with different cohorts of colleagues
- Have regular ‘open discussions’ with key employees – frequent 4 pm tea-chats. They must feel free to share about what bugs them. Such face-to-face meetings help pick up facial expression and body language
- Consider having an ‘open door’ policy – a ‘grandfather’ approach where the junior most staff feels safe and free to share her concerns with the founders/top leadership. This would mean having a lean structure without many layers of bureaucracy. Also, there should be perceived notion that employee feedback is taken seriously
- Make ‘Exit Interviews’ more purposeful and insightful – rather than treating it as a ‘process’ to be completed
- Don’t panic and give knee jerk reactions like an instant promotion or/and out of turn monetary raise. These are dangerous precedence and will surely come to haunt the company in the future!
- Constantly revisit ‘what is in it’ for employees’ vis-à-vis competition. Engage people intellectually, emotionally, and even through the physical environment and infrastructural settings at the work place
- Leadership must stay connected with the staff and seek inputs and feedback
- It is a good idea to consider ‘culture audits’ to measure employees’ connection and company’s work environment. Some insights may reveal differing views of old versus new employees as well as elder versus younger employees!
At trying times – like now – when there may be a wild hunt for talent and challenge to retain the existing ones, top leadership, team leads and HR in sectors like IT and related technology space are bound to face immense heat and stress. Important not to panic and take careful decisions; especially those which are difficult to retract and leave a precedence trail. It may also be a good time for companies to weed out the ordinary or below average performers from the star ones and look for more ‘best fit’ replacements. A season of talent churn may seem to be all noise and it is the smart leaders who will be put to test – while separating the signals from the noise!
Founding Team Member and Board Director – International Centre for Entrepreneurship and Technology (iCreate)