Why Retaining Your Best People Has Become Even More Important

Why Retaining Your Best People Has Become Even More Important

Why Retaining Your Best People Has Become Even More Important

Are you sick of hearing about ‘The Great Resignation’? It’s everywhere. 

There’s constant doom and gloom around the dangers of losing good staff in podcasts, articles, and newspapers. I’ve been as guilty as the next person of using this term. And yet now, I’m starting to wonder.

Is The Great Resignation really a stand-alone event that’s a direct result of the pandemic? Or is it part of something broader? There are indeed record quit rates in America. More Americans quit their jobs in August this year than at any other time in US history. Just think about that for a moment. It’s a sobering statistic.

It’s even worse in the UK, where the combined effects of Brexit and COVID are hitting hard. Brexit reduced access to the labour market, so it’s more difficult for people to come and work here. COVID has reduced movement. This double whammy is having a massive impact on our economy. But when you look back pre-2020, you realise this is nothing new. It’s part of a longer-term trend. 

In America, economic growth was stagnating way before COVID hit due to a shortage of talent. During the recovery years of 2008 and 2009, 30% of people in London changed jobs. So what’s happening now is nothing new. The reduction in growth that the financial crash had caused built-up demand. As businesses started to recover, their staff moved jobs to kickstart their careers.

So the Great Resignation isn’t a standalone event – it’s not something that we can weather and then re-emerge from. Instead, it needs to be seen in the context of a broader pattern of tightening labour markets. If your company has the customer base and capital to grow, access to talent will be your biggest challenge in the next 12 months. And this is why you need to throw everything you’ve got at retaining your best people.

Competition Has Intensified

We’ve talked to recruiters recently. It’s much tougher out there for small to medium-sized businesses. Why? Because you’re up against a much wider pool of competition for jobs. Make no mistake. Those larger companies are going to come after your good people.

Whereas before, London based firms would have limited their search for talent to an hour’s commuting distance from their offices, they’re now casting their net much wider. Companies in the South of England – in Southampton, Bournemouth and Portsmouth – are being targeted for potential talent. The same applies to businesses further afield, outside the big city hubs. It’s a direct result of new levels of flexibility, with staff only expected to travel to the office once or twice a week. 

As a result, it’s vital to shore up your business and future-proof it from these approaching headwinds.

Prioritise Talent Assessment

Have you ever sat down with your Executive Team and worked through a talent assessment exercise of all your staff?  We’ve written before on how to do this. It’s the first step towards identifying who to prioritise and where to focus. Don’t just do it once and forget about it. Make sure it’s a regular exercise that’s revisited every quarter.

Who are your A, B and C-Players (remembering that the definition of an A-Player is the top 10% of available talent for a given job, salary and location.) And of your A-Players, who is working in a team of 1? These are likely to be the weak points in your business, where you’re most exposed. So these people should be the priority for attention.

We did this exercise with a client a few weeks ago. They expanded their talent assessment to include some of the people that had quit in the last quarter. They wondered if, by ranking these people, they could see where the voluntary resignations were coming from. Two had been A-Players and two B-Players. And, hand on heart, our client had to admit they’d lost these people because they’d been working on their own without enough support. 

Let’s face it; there has to be a level of dissatisfaction that leads people to look around or take that well-timed call from a recruiter. Noone rings up a happy person and offers them enough money to persuade them to leave. Because they were solo operators, these staff had been more stressed. And because there was no one waiting in the wings to take their jobs, they could see no path to promotion.

Put in Succession Plans

Succession planning is the answer here. You want all your good staff to feel like there’s a career ladder just waiting to be climbed. Make sure you’re investing in people who could take over their job – as well as making your A-Player happier, it will mean they’re also not indispensable if they leave. 

And whilst you’re at it, introduce the Gallup Q12 and put it to work in your conversations with these top priority A-Players. You want to make sure they’d score you 5 out of 5 on this scale of team member engagement. 

You must find out where they want to be. A-Players are rarely motivated by money. I always come back to Dan Pink’s paradigm-shattering book, ‘Drive’. He explained that the secret to high performance and satisfaction is ‘autonomy, mastery and purpose’. So are you clear about what your purpose is as a company? Are your staff clear on this too? Is this person building mastery – learning and growing with every day they spend with you? Do they have autonomy and freedom to apply that mastery? 

Sometimes autonomy can show up in how they manage their time. We recently talked with an organisation that released their staff who needed the freedom to drop their kids off at school. This can make a massive difference to engagement and levels of happiness.  

Get Pay Levels Right

Are your essential A-Players underpaid relative to the rest of the market?  We always advise job scorecards in this context and have written before on how to work through them. Once you’ve got to grips with the most important activities in each role, you’ll be crystal clear about expectations. And so will the person in the position. You’ll also be able to work out what you’d need to pay someone to replace them. 

Make sure your best people are rewarded appropriately. A-Players can be hard to replace. At the very least, they should be paid the market rate and my advice, right now, is to consider paying them more to keep them. It will cost you a lot less than having to replace them when they’ve been headhunted by that big London business I mentioned earlier.

Look at Role Specificity

We see this all the time. In a typical start-up, people are doing multiple jobs through necessity. But as you start to scale, you have to separate these activities. Take the role of Account Managers – always an excellent place to start. Are your Account Managers responsible for Sales and Customer Service? Then you’re like most of our clients. But it’s not going to work well for you long term.  

Sales is very different to Customer Service and requires a more specific set of skills.  Good salespeople are also expensive, so separate this role and pay a couple of people good money for their sales expertise. Then the rest of the team can devote themselves to Customer Service roles that are easier to fill and paid less. 

Outsource as Much as You Can

Is there a bit of your business that you’re currently handling that could be outsourced? It’s a great way to tap into the talent pool of outsourcing companies, meaning you don’t have to recruit for these specialised roles yourselves.  

Take IT outsourcing. I remember back in the late 90s when I worked for Interliant. Outsourcing was in its infancy. I’d sit down with CEOs and ask them about their internal IT, and they’d tell me it was rubbish. When I suggested outsourcing, they thought I was mad. We couldn’t do that’, they’d cry. ‘It’s far too critical to our business’. So I’d ask them, ‘Do you have company cars? Well, do you employ your own mechanics then?’ They thought I was ridiculous, but outsourcing IT was the same as using outside maintenance for their car fleet.

Nowadays, internal IT support outsourcing is the norm – most of our clients have contracted this out. But don’t just limit it to IT. Look at all the jobs you have in your business that aren’t critical to adding value to your clients. Could you outsource them? What about Marketing? We have clients who have outsourced their marketing strategy, and delivery is a mix of permanent and contract staff. 

Remember, you want to use external agencies so that the recruitment and staff engagement headaches are no longer yours. If you try and directly employ these specialised staff, you’ll likely only attract mediocre people as you’re never going to afford to pay them top dollar. But if you find the right agency, they will hire A-Players and reward them with stellar career paths. This is why we were able to attract and retain rockstars at Rackspace and Peer 1. And it can’t be a coincidence that our client, Smartsourcing, who outsources back-office tasks for companies, is growing by 100% every year.

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Dominic Monkhouse

Leadership Expert

Dominic Monkhouse is a proven architect of business growth with a demonstrable track record. As managing director, he scaled two UK technology companies from zero revenue to £30 million in five years. Since 2014, Dominic has worked as a CEO and executive team coach, helping ambitious CEOs and their leadership teams reach their full potential and achieve sustainable growth. He is the host of “The Melting Pot with Dominic Monkhouse” where he talks with some extraordinary thought leaders, fellow business authors, and CEOs to absorb their wisdom. Dominic is the author of F**K PLAN B: How to scale your technology business faster and achieve plan A, an exciting blueprint for cultural change and business transformation.

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