This blog borrows from some of the best work done by exceptional People Teams across the world to help you drill down to the root causes of why your top talent and high performers are leaving. And most importantly, how you can implement concrete practices to not only retain but also attract top talent.
4.2 million people quit their jobs in June 2022 according to a US Bureau of Labor Statistics report. No, your employees aren't ready to settle even as the talks of an impending recession looms large. Now, sitting in August 2022, when talent layoffs have become commonplace for the last 2 months, one might wonder “is the number still that high?” Turns out this might not be the right question to ask.
One of the key defining criteria of top talent is that they can switch jobs almost anytime (well because your competitors would always love to have your best talent). And when budgets are becoming tighter and overall predictions are gloomy, it is all the more important to protect your top talent from leaving. It would be problematic, to say the least, if your top talent leaves and you are stuck with the rest.
I have been fortunate to have been a part of some exceptional (and some not-so-exceptional) Human Resource/ People teams for the last 7 years across 3 organizations. Most of my professional circle also consists of HR and People Leaders. To add to that, because I lead Klaar’s Business Development team, I speak to about 50 People Leaders every week.
Almost all Chief HR Officers/ Chief People Officers agree that one of their most important goals every year is to retain top talent and top performers. It’s often amongst the first two goals that HR leaders discuss while presenting to the board.
In these next few paragraphs, I’m going to share
But before that, let’s first understand what makes critical talent and high-performers look out for new opportunities and ultimately leave the organization. This is important because the best practices that I have seen achieve real results, all address root causes. Most organizations find it easier to treat the symptoms, but those are short-term fixes at best.
The reasons will no doubt vary from one organization to another. However, a Forbes study found some common themes.
Whenever we speak to top talent, one thing stands out in almost all of the discussions. The era of hyper-specialization is gradually taking a back seat. This is not to say that some employees don’t want to develop subject matter expertise. They do. But almost all top talent doesn't want to be boxed in. They want to explore other roles, latent talent, and new skills that they learn.
A recent Gallup study found that only 20% of employees worldwide (34% in the USA) were engaged in their jobs. This means in the US, 7 out of 10 of your top talent are actively disengaged! And one of the main reasons that were discovered was exceedingly simple: they are simply bored of doing the same work every day.
They have not been able to explore newer opportunities or put their interests and skills in motion. As a result, they are tending to gravitate to other organizations that give them this flexibility.
Let’s address the elephant in the room. Low pay is one of the causes that drive top performers and top talent to leave. And business leaders often feel that this is the most important and the only relevant cause. This could not be further from the truth.
According to a TIME magazine study, an organization’s ability to retain top talent with extra pay keeps on diminishing after the threshold of $75,000. Turns out, that once employees can provide for their families and are relatively comfortably placed in their lives, money is not that big of a motivator.
So, if your top talent workforce is paid lesser than $75,000 per annum, pay could be the first point that you might want to address. Otherwise, it is just one factor amongst all the other ones.
The last 2 years have not only changed how we work (the rise of remote and hybrid teams), it has also significantly changed what your top talent and employees expect from work. Gone are the days when employees were happy to be mere observers of their learning, development, and career growth opportunities. Your top talent is no longer satisfied with a one-sided relationship. They now want to be in charge of shaping their learning, growth, and career development.
One of the main reasons for leaving that we found in our discussions with top performers and top talent was that they had no visibility of their growth opportunities. Even when they were interviewing with other organizations, all of them mentioned that a significant chunk of their discussions was spent on how they could identify growth opportunities in these newer organizations. Another reason they mentioned was that they were unhappy with the feeling of not being in control of their careers and growth.
What these effectively mean is your top talent is moving to places that can provide them with the ability to shape and own their career and growth opportunities. What these also indirectly mean is if you don’t start providing for the same, not only will it be extremely difficult for you to retain your top talent, but to also attract new ones.
Organizational culture is truly not as fuzzy as it seems. It is the shared beliefs, behaviors, and values that are first defined by leaders and reinforced at every step. A hidden aspect of culture is what behaviors get reinforced on the ground as compared to the ones that have been defined. A lot of top talent that we spoke to mentioned that the true organizational culture on the ground is the one that they were misaligned with. The common points that they mentioned were:
a. lack of recognition - they had no concrete idea of what behaviors were actually rewarded and most importantly they themselves were not recognized consistently or at all
b. lack of clarity, fairness and transparency - promotions and other talent decisions were not based on actual performance and potential but more on relationships, hidden agenda, and upward management
Now that we have a fair bit of idea about the root causes, let’s dive into practices that you can create and implement to retain your top talent and top performers.
This one particular action, if done properly, addresses all the 4 root causes that we discussed above. Empowering and enabling though are 2 different things in this context.
Enabling would mean that as an organization, you have created the technical infrastructure, policies, digital support, and structure for your employees to be able to play a part and have a say in their careers, learning, and growth.
Empowering, on the other hand, means that even with all the enablement measures in place, you are ensuring that your top talent has the power to take these actions. A lot of times, even after a brand new tech platform has been implemented with an org-wide celebration and launch, the real results don’t start showing through simply because the people on the ground are not empowered enough to use those platforms to the fullest extent.
For your top talent to play a part in their learning, career development, and growth journeys, they must first have access to all of these opportunities. It cannot be unilaterally dictated by organizations anymore. Your top talent should be able to have democratized access to relevant mentors, learning opportunities, and all internal movement opportunities such as short-term projects, part-time gigs, cross-functional initiatives, or even full-time roles. To add to that, the technology platform selected for this purpose should also be able to give clarity to your top talent on how they could move up in their careers - what are the paths available for them, how they can access those paths, which skills to learn, how their performance criteria should be to move roles, and so on.
Now if you are wondering why your Internal Job Portal or your offline Mentoring Initiatives barely see any adoption, it is because they are simply not enough. Your employees and especially your top talent do not have the bandwidth or the patience to sift through irrelevant roles, learning courses, and mentors.
What’s the way to do it then? Well, it turns out that probably the most effective way of doing this is to implement an Internal Opportunities Marketplace (IOM). Typically, an IOM platform like Klaar first understands your employees’ skills, aspirations, psychometric strengths, experience, and even Development Plans. Then Klaar starts matching your top talent to relevant mentors, learning courses, masterclasses, internal roles, and more.
And along with this, they can also clearly see the career paths that are possible, and how they can build on their skills through the IOM and accelerate their journey towards the next milestones.
Now comes the more important question, how can you empower?
Implementing a platform like Klaar is easy. However, you will see real results when people use it to its full potential. There are 3 primary ways to get rid of initial apprehensions that your people might have and empower them to truly shape their growth and development.
a. Ensure that your leaders actively reinforce the IOM platform. Your top talent will naturally be apprehensive at first to reach out to mentors and swap roles. This is, after all, the first time that they are experiencing democratized access to opportunities in your organization. The leaders have to consistently encourage the use of this platform and let your top talent know that the new behaviors are actively encouraged.
b. Relook at policies. In a lot of organizations, even after the implementation of an IOM platform, internal career movements are still limited. This is either because the existing managers are hoarding your top talent or your policies don’t allow for career switches within the organization. In either case, your policies and practices on the ground (and the adherence to them) should be flexible enough to accommodate this new shift.
c. Create employee champions and highlight success stories. You need to show your people, especially the fence-sitters, that others are making full use of this platform and shaping their careers, upskilling, and engagement.
One of the main reasons why employees are initially apprehensive of adopting new initiatives by the People Team is because they often end up getting penalized. Your IOM initiative, and for that matter any people initiative, cannot exist in a silo. They have to be linked with performance and talent decisions. Let me explain with an example.
Picture this. People are excited about a new platform that you have implemented till they realize that all they are being still judged on is performance metrics. Your adoption numbers reduce drastically and it becomes just another initiative that needs to be pushed on to the people. At the end of the year, you struggle to justify the business ROI from your initiative and the jury is out on whether it should be continued the next year or not. Does this scenario sound common? If it does, you already know why your IOM initiative needs to be linked with performance and talent metrics.
A robust yet simple way of doing this is to ensure that existing managers are always aware of the full picture, namely the:
All of these should play a part in the overall performance discussions, ratings if applicable, and finally promotion and internal talent movement decisions. This is one of the main reasons why Klaar also has a module dedicated to performance. So that you don’t have to hop from one disconnected platform to another, you can complete all your performance tracking and discussion right on Klaar and at the same time have a complete understanding of everything that your team members did.
An additional side note: you can also look to include performance, productivity, and feedback ratings in policies that govern your internal career movements. This further promotes transparency and fairness.
A lot of organizations harbor the impression that unless they pay significantly more than their competitors, they stand no chance of retaining their top talent and high performers. And because they are unable to do so, they will also not make any changes to their existing compensation structure, even if that’s not competitive enough.
Needless to say, this line of reasoning doesn’t hold. As I mentioned above, the decision to leave an organization is rarely dependent on one factor. So if you can create a competitive pay structure and implement all of the other points, the chances are that your top talent will swap creating CVs and applying to external roles for thriving in an organization that gives them the flexibility to grow and develop and values their contribution. A competitive pay structure might mean that you are paying at the 60th percentile of market pay for roles. It might vary from one organization to the next.
Here are some findings that further highlight this point:
In all fairness (pun intended), these are heavy-sounding words. And quite often, heavy words are often mixed up with words that cannot be measured or even defined properly. These are anything but that. Your organizational culture plays a huge role in how effectively you would be able to retain and attract your top talent. Millennials who make up the dominant part of the workforce today are clear: they want better work-life balance and to be a part of non-toxic cultures that stand for values and a purposeful organizational mission. And here’s how you can craft such a culture seamlessly.
a. Continuous Feedback - ideally you should be embedding this as a way of life, be it in the Performance Management System, after every meeting, product release, and so on. Ensure that your leaders are receptive to giving and receiving feedback.
b. Recognition - this is one aspect that is so easy to do but so many organizations pay the price for missing out on it. Consistently recognize people, be it in the course of their work or formal award ceremonies. Continuous recognition is an extremely powerful motivator that might just be the difference between your next top performer leaving and staying with you.
c. Ownership - you need people in your teams who feel like owners and not just executors. A top performer who truly feels like they own their deliverables will go the extra mile wherever needed. And for that, you need to enable your people to understand how their work makes an impact on the overall team, department, and organization. This takes away the feeling of being a cog in the wheel and drives up ownership.
d. Fairness and Transparency - simply put, these are the must-haves of a non-toxic culture. Be it performance metrics or talent decisions, the decision-making criteria should be specified and adhered to instead of resorting to back channels, upward management, and clandestine relationships.
And there you have it. A step-by-step approach on how you can ensure that your top performers and top talent are sticking with you for the long haul. A lot of organizations implemented Klaar to deal with this particular problem. The returns range from 1000 to 2500% ROI (losing your top talent is costly). You can always understand the value that the platform brings with a free trial. It might be the difference between your top talent working for you or your competition.