For many organizations, talent management is almost solely focused on recruitment: filling empty seats is the priority. Why and how those seats come to be empty though is often overlooked, as is the opportunity to effectively manage talent for employee loyalty and longevity.
Creating a talent management strategy for long-term employee retention starts before the recruiting process begins and continues long after onboarding. A collaborative approach is key to success.
The goal is to create a strong, diverse, innovative, and loyal workforce then build around that core to anticipate skills gaps, scale without losing momentum or productivity, and effectively future proof your organization against changing industry demands.
External Talent Management
Identifying organizational talent needs and hiring the best candidates for each role typically requires some level of outside involvement. Whether companies use individual recruitment professionals or the services of a larger recruitment firm, alignment of goals is critical.
Talent Acquisition in a Competitive Landscape
The labor market is increasingly competitive as the Great Reshuffle continues to have a ripple effect on what workers demand from employers. With nearly two job openings for every long-term unemployed American, workers have leverage for the first time in decades.
Top talent is off the market in just 10 days, but the average time to hire can be two to four times that long. Balancing the need to speed time-to-fill with the risks of making a bad hire under pressure makes recruitment an enormous challenge.
Continual recruitment can be key to reducing talent acquisition costs and keeping spots filled. 51% of talent professionals “soft recruit” throughout the calendar year for positions that may open up later on. Of those who follow this practice, 55% say their time-to-hire goes down and 42% say it reduces their cost-per-hire.
Top talent stays on the market only 10 days.
Time to hire at most organizations is up to 40 days.
Recruiting for Long-Term Retention
Recruiting just to ‘fill seats” is shortsighted, ineffective, and costly. With the average cost to replace an employee ranging anywhere from four to six figures, a revolving door due to employee attrition is an expense that can be difficult for many organizations to absorb.
Putting a little more effort into the recruitment process can result in significant cost savings. By hiring with long-term in mind, companies can stop the revolving door of recruitment, and build strong teams, retaining talent, and knowledge that is commonly lost through high-level churn.
Recruiting To Close Skills Gaps
A company that needs another assistant manager shouldn’t just hire another person with “assistant manager” experience. Instead, look at the organization as a whole, and identify skills gaps. Hiring an assistant manager who is strong where others are weak can mean a net benefit to the business and create a path to leveling up within the company.
Even new hires that don’t tick all of the boxes normally associated with a position can be a superlative hire if they bring new skills to the table that can be leveraged to fill existing gaps. Anyone can be trained to complete their knowledge of the basics, but soft skills are harder to teach.
Soft skills can actually be a better indicator of future job performance than traditional hard skills. Nine out of ten talent professionals and hiring managers say that soft skills matter as much or more in recruitment than hard skills, and that bad hires typically lack the right soft skills.
Recruiting to Build Future-Proof Teams
The battle for talent means many high-value employees have been drawn into a cycle of job-hopping every few months. They are continually headhunted, and with the labor market as tight as it currently is, offers come with more zeros, better benefits, more flexibility, and extra promises. One in three employees will leave their current employer for only a 10%-20% bump in pay.
One out of three employees would take another job for a 10% - 20% bump in pay.
On-the-fence workers typically want promotions, salary increases, and flexibility to prevent them from leaving. However, on-the-job training combined with a chance for career advancement, recognition for work well done, and the perception of loyalty from company to employee factor highly into employees' decisions to stay with a company.
In fact, company culture is why 65% of employees with other job offers on the table choose to stay with their current employer. Building a strong company culture that supports diversity and employee engagement is one of the best ways to promote retention and future-proof a workforce.
Recruiting for culture add
If employee commentary - either in exit interviews or reviews on sites like Glassdoor - continually cite a toxic company culture, it’s time to redesign how the organization is set up in regard to employee engagement, and worker recognition. Without support from their employer, employees don’t feel any loyalty and performance suffers along with morale.
Getting away from culture fit (which tends to severely homogenize a workplace and stifle independent thought and innovation growth) is key. When everyone in the office looks, talks, and thinks the same, comes from a similar background, and holds the same views, the result is stagnation.
Only 54% of executives in one survey said their organizations had a clearly defined culture, although 82% felt culture fit was important. Unfortunately culture fit supports unconscious bias and leads to hiring more unengaged employees. Meanwhile, 46% of job seekers say culture is one of the deciding factors in the application process.
Making the shift to culture add can bring in badly needed new perspectives, and shift the workplace from a homogenous slate of similarly unengaged workers to a collaborative group of inspired workers who play off each others’ strengths.
Importance of DEIB
80% of job seekers say that they want to work for a company that values diversity, equity, inclusion, and belonging (DEIB). Executives who fail to make this a priority can find themselves missing out on top talent.
Ensuring that DEIB is present throughout the company, from sourcing and recruiting through to company vision and action, can help draw in candidates with specialized skills who have the luxury of selecting what company they want to work for.
Four out of five of job-seekers prioritize DEIB
as a company culture must-have
Nurturing is critical in a tight labor market; 83% of recruiters acknowledge that the task of sourcing is now heavily candidate driven. A top complaint of job seekers is lack of communication from recruiters and hiring managers. Even an automated rejection at least gives candidates closure.
For candidates still in the running, a week without communication is enough to dampen their enthusiasm, and two weeks is when most give up and move on. Many companies lose top talent simply by not keeping finalists in the loop.
A whopping 82% of candidates not only want employers to provide a clear timeline for the hiring process up front, but say they expect to remain updated as the process moves forward. Dragging out the process can mean candidates move on, assuming the employer simply is not that into them.
Making competitive offers
For top talent, make the best possible offer out of the gate, and then be willing to negotiate if the candidate has different priorities than just a dollar amount on their paycheck. Companies can make it attractive to work for them without getting into a bidding war.
An employee who is excited about the company culture and the potential for flexibility in scheduling may often be willing to accept a lower salary than they listed on their application. Aligned candidates are more likely to remain engaged when their primary motivator isn’t money.
A competitive offer may come in at less than what a competitor is dangling like bait, but if the position and workplace are a good match, that may not matter. 71% of respondents to one survey said they would cheerfully take a pay cut for their ideal job.
71% of candidates would take a pay cut for their dream job.
Flexibility Is King
The future of the workforce is distributed. The pandemic showed that companies could remain profitable and employees could remain productive even without being physically present in the same building every day.
While not all organizations were or will be fully remote, the trend is growing. One survey revealed that 40% of employers are open to at least some employees working remotely part of the time. That’s down from 69% at the height of the pandemic, but well up from the mere 16% pre-pandemic.
57% of organizations also offer flexible schedules, which can be even more important to specific employee demographics, including parents of young children or caregivers of aging relatives. However, job flexibility is desired by almost all US workers: 96% say they need flexibility although currently only 47% say they have it.
Internal Talent Management
Sourcing new candidates and figuring out what they want is only half the puzzle when it comes to creating a talent management strategy for long-term retention. Workers who have managed to make it through the hiring funnel must be nurtured from onboarding onward to keep employee churn rates down.
Love the One You’re With
The right employee for an open role could be hiding inside the current workforce, but failing to shine due to lack of attention. Sometimes it’s less labor intensive to identify overlooked talent within the organization and put time and effort into building them up with encouragement and mentorship than to keep feeding the revolving door with outside hires who look good on paper.
79% of employees quit because they don't feel that they or their efforts are appreciated. Simply identifying work well done and rewarding existing employers in tangible ways can help reduce attrition and improve the reputation of the organization as a workplace.
Eight out of ten employees are willing to walk away
because of lack of appreciation.
Right Person, Wrong Role
The best person to fill a critical role could even be someone recently hired who now appears to be on their way out. Rather than being a “bad hire,” they might just be a mismatch for the job they are currently in.
72% of jobseekers say they've started a new job and been disappointed when a role (or company) was very different from what they were led to believe.This is why setting up and following through with continual touchpoints during the first 100 days of employment is so crucial.
These interactions can help reveal when a new hire is floundering, and provide the opportunity to find out why the job they got isn’t turning out to be what they expected. A recent hire who has shown promise but is experiencing dissatisfaction can often be moved laterally into another open position, dissuading them from quitting, and leaving only one role to be filled.
Learning and Development
It's predicted that 50% of the global workforce will need to be reskilled by 2025. Whether or not an organization is investing in their employees has an enormous impact on retention. In one survey, 70% of the respondents indicated that job-related training and development opportunities influenced their decision to stay at their current job.
Another survey revealed that 74% of employees feel they aren’t reaching full potential at work due to lack of development opportunities, and 61% of job seekers weigh career development opportunities when considering job opportunities. More than 70% of high-retention-risk employees will leave their company in order to advance their career.
Offering L&D opportunities doesn’t just boost retention and attract potentially long-term new hires. One study of how a business’ bottom line can be affected revealed that companies that offer comprehensive training programs have 218% higher income per employee and enjoy a 24% higher profit margin than those who spend less on training.
Seven out of ten high-retention-risk employees
leave a company to advance their career.
Promoting From Within
Promoting from within can be an effective way to reduce recruitment costs. The expense of hiring an upper level manager is far higher than that of hiring an entry level or mid level employee, and the gaps keep increasing. An entry level employee costs 180% less to hire and onboard than an executive.
Promoting from within increases employee loyalty, keeps important accumulated knowledge inside the organization, and reduces hiring costs on two fronts: hiring internally reduces the cost of recruitment and onboarding for the more senior position, and the entry level position costs less to fill.
Employees passed over for a promotion by an outside hire are 15% more likely to quit or consider quitting than those passed over for an internal hire. In addition, more than 6 out of 10 employees experiencing dissatisfaction with their job for any reason are willing to leave without even having another job offer waiting in the wings,
64% of employees are willing to leave a job
without having a new one lined up.
Nurturing High-Value Employees
Figure out which current employees have not only remained long term, but have demonstrated loyalty through motivated engagement and performance. Build candidate profiles that match those identified, and look for candidates that fit the same mold.
Meanwhile, focus on providing the things high-value employees want and need to keep them motivated to stay. Whether this is flexibility in work location or hours, access to mental health services, or L&D opportunities plus the chance for in-organization advancement, find ways to invest in and nurture their talent and loyalty.
Employees stick around 41% longer at companies that have strong internal mobility programs compared with employees at companies that have weak internal mobility offerings or none. Additionally, workers who feel their companies offer enough flexible options are 2.6 times more likely to report being happy in their jobs, and 2.1 times more likely to recommend working for the company.
Making the Save
Another part of identifying high-value employees is being able to create a game plan to retain them even if they are being headhunted. A passive employee may not be actively looking for another position, but can still be at risk for being tempted away, especially if they have an in-demand skill set.
List employees with high-attrition-risk, and calculate how much it would cost to replace them, and how much it would be worth to spend on keeping them. Then be proactive in efforts to engage with those employees and ensure they are satisfied.
In organizations that are still struggling to mature their DEIB policies, diverse employees may be at the top of the attrition risk list. In one study, a company identified 200 such employees and made a conscious decision to proactively retain them.
To this end, they conducted stay interviews, touching base with each employee, and asking them what they needed in order to stay and prosper at the company. Ultimately, they kept 96% of the targeted employees, showing that a stay interview may be the best way to prevent the need for an exit interview.
From pre-hire to post-hire, Crosschq helps you source, screen, onboard, and measure the best talent. Fast.
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