David Buffington
Tom Short, president of Rare Method Interactive Corp., knew that one of his senior staffers was worried about the company's stability and how she fit into its future.
No wonder. With layoffs and attrition, the Calgary-based interactive marketing firm's work force had been sliced in half from about 100 to 50 in a year. That churn had prompted a few other uneasy workers to jump ship for other opportunities.
Reluctant to see more good workers leave, Mr. Short sat his employee down for a frank, one-on-one chat, reiterating his vision for the business and how her contributions tied into overall company goals. He also sought her input on how she felt about her job, management and the company itself.
"She went from being worried to completely engaged," Mr. Short says. "She started contributing great ideas on how we could change and streamline processes. She even took on extra duties. She felt like part of the team and knew just how she added value to the company."
In his effort to increase worker loyalty, he's had similar conversations with other employees, simply letting them know how they've helped the firm and how much he appreciates their work.
"It's about re-earning trust," Mr. Short says. "You want to retain your good people, because they are the ones who can always get a job anywhere."
Re-earning the trust of workers should be top of mind for every employer, experts say. After a year and a half of layoffs, wage freezes and increased workloads, employees are feeling weary, dispirited, fed up - and ready to seek other pastures. As Canada shakes off the recession and the turnaround picks up speed, it will be employees who do the dumping, not employers.
That means employers have to take real measures to retain employees who are preparing to jump ship, the pros say.
Six in 10 employees intend to pursue new job opportunities in 2010, according to a recent survey, and another 21 per cent said "maybe" and are already networking toward it. Another 6 per cent of the 904 North American workers polled by staffing service provider Right Management Inc. said a move is unlikely, but they've nevertheless updated their résumés. Just 13 per cent said they intend to stay put.
Employers may be starting to take notice. More than half - 54 per cent - see retention of high-value employees as a top talent priority this year, according to a separate survey of 2,107 senior Canadian executives by Right Management. That is a huge jump from the 15 per cent in 2008 who saw talent retention as a major focus, according to Right.
"Companies have an implicit contract with employees, and there's been a ton of stress on that relationship. Many firms have had to break that contract," says Henryk Krajewski, vice-president and national practice leader for Right Management in Toronto.
"Employees who kept their jobs feel like they're the ones who have been penalized, and people have long memories when it comes to how they've been treated," adds Heather Stockton, a partner in Deloitte & Touche's human capital practice in Toronto.
Two out of five workers - 40 per cent - say they have had difficulty staying motivated at work in the past year, and 24 per cent say they do not feel loyal to their employer, according to an online survey of 7,200 U.S. employers and employees by CareerBuilder.com.
What's more, few organizations have a clear understanding of the negative effect that increased turnover will have on their company's ability to perform, Ms. Stockton says. A recent Deloitte survey found that nearly half of managers polled believed that turnover will increase their company's profitability.
In reality, replacing employees - particularly critical talent and high-potential employees who may be the biggest departure risks - typically runs two to three times that person's annual salary, she says.
Mr. Krajewski cautions that even engaged employees are aware of opportunities elsewhere, and the best workers are mobile in any economy.
"People are always attracted by career development opportunities, attaining work/life balance, or working for a company with an innovative culture. If management doesn't provide these things, then workers are going to seek them elsewhere," he adds.
To keep their best employees from fleeing when the economy turns around, smart companies will up their retention efforts by increasing communication with staff, offering more kudos for jobs well done and finding innovative ways to develop skills, Ms. Stockton and Mr. Krajewski say.
That's why Richmond, B.C.-based Great Little Box Co. president Robert Meggy has worked hard to develop a corporate culture based on mutual trust and respect, in which employees are valued for their contributions and rewarded.
When company sales dipped last year, Mr. Meggy had to make some hard choices to trim costs. Instead of jeopardizing that trust by chopping staff or reducing pay, Mr. Meggy looked at other ways to streamline expenses. When an employee retired or took maternity leave, for example, the firm chose not to replace them. The firm also cut back on social events and held several brainstorming sessions with employees to generate ideas on how it could save money.
Mr. Meggy shares corporate and financial information at monthly meetings. "Opening the books creates a sense of trust, and people feel part of something," Mr. Meggy says.
The transparency also means there are no surprises. Employees know where the company stands and why decisions are made, he adds.
"People really are your best assets," he says. "If employees trust that you have their best interests at heart, they'll stay committed to the organization."
Enhancing employee engagement and retention has also been a top priority for Ken Bennett, chief executive officer of Johnson Inc., a St. John's, Nfld.-based insurance broker with 65 offices and 1,200 staff across Canada.
One of Mr. Bennett's top tactics is spending face time with employees. He hosts frequent employee lunches and "up close and personal" sessions, giving staff company news, updates and fielding questions ranging from issues about the company's growth to his vacation plans.
Mr. Bennett says despite challenging times, last year the firm managed to increase its investment in its people by rolling out a new information technology system and introduced a health and wellness program. The company has also ramped up its mentoring program, which pairs experienced staff with junior employees. Each of the company's executives across the country will formally mentor three or four employees each this year.
Of his overarching people philosophy, Mr. Bennett says: "Our people drive our business. So, we have an absolute passion in doing the right thing so they feel proud to work here."
At Rare Method, Mr. Short is furthering his employees' skills by getting more staff involved in critical decisions and discussions wherever possible. "It scares the hell out of some but others appreciate the opportunity to contribute. They are even taking on more because of it," Mr. Short says.
The payoff: "We are seeing signs of life in the economy and more excitement every day in our people. They also now believe there is light at the end of the tunnel. It actually is refreshing to have people wanting to step up versus stepping out."
What workers want
Be transparent
Be visible and accessible. Use company-wide and individual meetings and e-mails to keep workers in the loop. Give frequent updates on the company's direction and goals and how well it's meeting them. Give staff the opportunity to ask questions and answer them truthfully, even if it's to tell them you don't know.
Reconsider rewards
If the company was forced to implement pay cuts or a wage freeze that you can't afford to reinstate, find other ways to compensate staff. Days off, flexible working hours and even product discounts are all low-cost ways to reward staff.
Develop creatively
Expose employees to senior leadership through mentoring programs. Consider job rotations to give employees experience in other areas. Allow high-potential workers to handle special projects or work on high-potential accounts.
Care for top performers
Identify your top performers - attractive targets to competitors. Let them know you value their dedication. Pre-empt competitive offers by providing them with valuable development opportunities worth more than money.
Offer engaging career path
A solid career path and challenging work are very important, especially for Gen X and Y workers. Help staff determine their future goals and provide action plans to help them reach those goals.
Provide meaningful work
Help employees understand how their jobs are meaningful by demonstrating how they fit into the overall success of the company. Identify a clear relationship between work and reward and give staff responsibility to control the work they do.
Attention to retention
What companies are willing to do to retain employees when the economy improves:
Increase investment in professional development: 54%
Promote top performers: 46%
Raise salaries: 42%
Reinstate or increase bonuses: 28%
Enhance benefits: 25%
SOURCE: STAFFING SERVICE ACCOUNTEMPS SURVEY OF 270 CANADIAN CHIEF FINANCIAL OFFICERS; MULTIPLE RESPONSES ALLOWED