Why Can’t Organizations Attract and Retain Talent?
Nancy O’Keefe, Author, Fighting The Talent Battle: How To Update Your Arsenal and Win the War
Finding great employees is a top problem organizations struggle with today. It is getting more and more difficult to attract, motivate and retain employees with the skills that are needed in a fast-changing business and technological world. Business leaders should be looking for the problem solvers, the innovative thinkers, the adaptable leaders and those with strong emotional intelligence to build the skills into organizations that are needed today and will be needed tomorrow. These skills and characteristics are becoming harder and more expensive to find. It currently costs about 2x salary to acquire a new hire and that price tag is going up as the supply of those skills become scarce.
We have an employment crisis.
- The Baby Boomers are exiting the workforce, taking 50 years of achievement-oriented, workforce stability with them, the stability that leaders have come to count on.
- The Millennial's already make up more than 50% of the workforce and have very different ideas about work. They are not motivated by the same things as the generations before them.
- The concept of the job is changing and management methods are not keeping pace.
As we navigate these massive people shifts in our workforce, we do so with employee engagement still at an alarmingly low 30% [i] despite years of time, effort and money spent to improve it. As if that is not bad enough, studies show that as much as 50% of the workforce is looking for a new job. The average length of stay by an employee is predicted to drop from about 3 years to 1.6 years. Add that fact to a shrinking labor pool and simple supply and demand tell us the cost of hiring is going to continue to go up. That adds up to one big and expensive problem for businesses.
Clearly many organizations are working on the attraction and retention problem, but the numbers tell us that despite all of the time, money and effort expended, year after year we still see 70% disengagement, decreased productivity and increased turnover rates. We have tried to combat this problem with creative ways to attract and retain people. Signing bonuses, snacks, and drinks in the breakroom, recreation and stress relief in the employee lounge, flex time, work at home time, and unlimited PTO. These are all great benefits, but these perks treat the symptoms of the problem. It isn’t making the difference needed, the numbers are getting worse, the costs higher. We need a different tact.
We need to take a hard look at our ideas and philosophies around employees, the concept of the job, career, and the way we think about managing people and our organizations as a whole. Many of the principles and assumptions about people that we run our organizations by today were founded 100 plus years ago around the Industrial Revolution for mass production, manufacturing-based businesses. Holding on to a 100-year-old paradigm is keeping us stuck in thinking that perpetuates an unmotivated, unproductive and dissatisfied workforce. As business leaders, we need to understand the cause of the problem and we need to roll up our sleeves and solve it.
We are experiencing a huge people shift. We are trying to attract and engage employees that don’t want what we have to offer and no longer have to settle for it because there are less risky entrepreneurial alternatives. The days of the employer having the hiring advantage because working for someone else on their terms is the only game in town are over. Enter “The You Economy”. Uber, Lyft, Air BNB, Zipcar, Thumbtack, Updesk, and countless other places employees can go to earn their living or supplement their income. A Success Magazine survey from 2016 stated that four out of 10 Americans had already used at least one You Economy service and that number is growing every day.
During the Industrial Revolution, people came to work for business and industry for a steady paycheck and some security. The shift we are experiencing today will be as large and as disruptive as the Industrial Revolution, but this time people will be leaving traditional business and industry for a better work experience and a better quality of life. Organizations are no longer simply competing for talent with their competitors. The whole concept of a job is being disrupted.
The talent problem is like a three-legged table. In order to function as a viable table, all three legs need to be even, steady and strong. It is an interdependency created by its design that makes it impossible to fix a problem with the even keel of the table by looking at just one leg. The three legs of the talent problem are:
- How we think about acquiring talent. How we arrive at what we need isn’t always well defined and where and how we look for talent becomes rote, always going outside because we don’t have a strong sense of the talent that already lives in our organization.
- How we think about jobs, careers, and advancement. New generations have different ideas about the work experience, the meaning of work and what advancement means.
- How we create the organizational environment and manage it. We must ensure our organizational environment, management team and culture work together to create a place where skilled talent wants to work.
Our job as organization leaders is to change our paradigm. We must create both opportunity and an organization that serves employees. Work is a business deal. Many of the current control and accountability-based management constructs are roadblocks to our success in motivating and retaining talent. As organizations, we are in push mode, pushing to find talent, pushing to motivate them, pushing to keep them, pushing to fight the talent battle. Our focus is misguided. We must shift our paradigm from push to pull. We must pull the talent we want to our organizations by being places talent wants to work. That is what attracting talent is about.
About the Author
Nancy O’Keefe, MBA, is a Strategic Adviser, Executive Coach, Speaker, Trainer, and Author of the Book Fighting The Talent Battle: How To Update Your Arsenal and Win the War. She works with business owners and senior executives to create profitable and productive workplaces that attract, motivate and retain great people. She is a thought leader in strategy, management and cultivating talent. She can be found at http://www.NancyOKeefeCoaching.com
[i] Gallup Organization, State of the Global Workforce Report, 2013, 2015