The economy is changing. And, as the economy improves, companies can be in trouble- unless they have been well managed with talented leaders. Because those employees who feel they’ve been betrayed or let down by the company will leave. Statistics show that during upturns between 30 and 50% of the talented individuals depart. And, it also is a function of the employee’s age, gender (1/3 of the men will stay for more money, but less than ¼ the women would do so), tenure, and how many months since their last promotion and/or salary bump. It also reflects if the employee feels left out of the loop (the manager has too many employees in his/her group), how much travel is involved in the position, the hours worked, the weekends they need to be present, as well.
Here is an example that can provide an idea of the loyalties that exist in a fairly well managed firm. (It also is not that atypical from firms we would classify as just adequately led.) The employees rated their chances of leaving the firm on a scale of 1 to 10, with 10 being most likely to depart.
As you can see, as the economy improves, this firm is in danger of losing its most experienced staff- with whom the corporate history and knowledge resides.
This kind of “map” results from companies that spend lots of attention on their new hires. As such, those who have been there for a while feel neglected. And, their salaries are condensed compared to the new hires. Moreover, those in the middle can sense if they are not on the fast track to success- and, if they are talented, they are more likely to abandon ship at the first opportunity that presents itself.
The time to react is before the employee has a chance to leave. And, as far as we are concerned, the time to react is from day one- and every day thereafter. One not only has to insure talented staff aren’t neglected, but that all staff are provided the tools to maintain their passions.
We need to insure that we provide context for their tasks and goals. They need to know the connection to the vision and mission of the enterprise. And, we, as the leaders, must maintain focus on the strategy- insure that the stated strategy is the one that obtains and not just fancy words on paper. Our projects, tasks, and goals must be aligned with our strategy- and the staff must understand that.
And, given the current political situation, we must insure that our staff doesn’t feel we have a fairness issue. We can’t have some employees accountable and not others, nor can there be inconsistency in pay rates. We, as leaders, must insure we provide face-to-face communication with our teams. (If we can’t get there, we need to use video conferences or Skype-like systems.) If these matters are not effectively handled, an entitlement mentality will develop; but worse than that, less discretionary effort will be applied to achieve goals and tasks.
Leadership is an influence process. We have to proactively manage the situation- the efforts and mindset of our staff- and their hearts. With meaning and purpose aligned to the projects and tasks, we all feel emotionally attached to the effort.
Leaders must praise and encourage effort- as well as employee contributions. We must work to remove- or at least minimize- hurdles in our staff’s way. It’s the way to keep employee spirits inspired- and to survive the improving economy with our best talent intact- and have them remain passionate for our cause.
I know my hubby would have alot to say about this. Being a part of the working management doesn’t even mean you are kept in the loop. That is the frustrating part.
shawn recently posted..Silent Killer
Shawn…
I feel for your husband. There is nothing worse than trying one’s best to help achieve the goals- and then finding out that management has no regard for its staff.
Roy
Roy, this should be required reading for all management. In my 30+ years of corporate life, it was a sad fact that good leaders were few and far between.
Although I left to start my own business at the height (or should I say the low? 🙂 ) of the recession, I experienced on more than one occasion the role of one of the employees left standing after layoffs. That standing was pretty wobbly when you were doing the jobs of 2-3 people. And, you’re right, that can lead to a whole lot of anger.
Cathy Miller recently posted..A Guest Post About Guest Posts
I could not have said it better, Cathy!
Thanks so much for bringing those points to the fore.
And, amazingly, so many employers have no idea why they lose employees when the economy turns…
Roy
Excellent points, Roy. Leaders need to step up their game and put people first. This is so important. I would love to have your input during my Thursday night #bealeader chats. Join in, I believe you could bring a valuable info to the table. As the market opens, many are going to seek out cultures and employers who give them more than just a paycheck.
Jennifer Olney recently posted..Pardon Me, Do You Validate?
Thank you so much for your kind invitation, Jennifer.
Leaders certainly need to insure that everyone is following- and following happily!
Roy
Leadership is an influence process. I wish all employers had as much insight as you do.
I think all employees want recognition, appreciation and respect. An employee will not want to leave a place that feels like home.
Janette Fuller recently posted..Tribute To My Mother-In-Law
Great statements, Janette!
You hit the key points with a well-honed hammer.
Roy
Prevention is the cure! Proactively helping employees to feel a part of something bigger, not just a cog in the wheel and valuing the leadership they are providing or giving them tools to uncover untapped leadership is a low cost, high return proposition. Excellent post…as always.
Thanks for your comments AND approbation, Tambre.
Leadership requires not just statements- but consideration of everyone’s desires and needs.
Roy
The economy is a mess and not likely to be corrected any time soon. I see problems from both the management and the employee side of the fence. I am watching the American Airline meltdown here in North Texas and see that instead of people working together to keep working, all wanted more of less than nothing. It’s a simplistic solution, I’m sure, but if the entire company had been willing to take cuts in pay, perhaps they would not be in bankruptcy with everyone in danger of losing their jobs. But what do I know?
Ann recently posted..Developing Persuasive Marketing Materials — 5th Rule of Marketing Ball
Really, Ann, just because AMR executives are now pleading a different case does not make it so..
You think the executives of AMR have been taking cuts in pay to help the company? No, they have been trying to cut the pay of their employees.
Read this: http://blog.chron.com/lorensteffy/2011/11/amrs-pay-packages-reward-executives-for-workers-sacrifices/
If we continue to follow the myths that are spun, we can never make intelligent choices. AMR has been rewarding its executives for absymal performance forever. It’s one entity whose merger- with the termination of the existing executives- I actually anticipate with glee!
You know being out of the “employed by someone else game” for a long time I tend to forget things like this. I do remember lack of recognition and wage being a factor in me leaving a job before though. It reminds me of a post you did a while back about following the Kosher standards in employment, and I wonder now in this post if that standard was every business practice if people would leave as readily as they do now. Great post, Dr. A. Thank you!
Lisa Brandel recently posted..Sandy Beach Bridge by Lisa Brandel
Thanks for those comments, Lisa.
Yes, we need to remember the long term, the reciprocal contracts for companies to achieve great success
These are very good points Roy. I remember my ’employment’ days and being in management how important it is to build a team but more important, to maintain what you have. People need to know they are there for a purpose and that they are needed. Glad that you share the stats which are eye opening.
Lynn Brown recently posted..Creating Videos From Your Blog Posts
Lynn:
Thanks for adding substance to the discussion. To some degree (hopefully, not to a large degree), many corporations only see one side to employee management- as the means to garner profits. These companies have lost their long-term focus, because their management is rewarded by short-term goals, including stock market performance. There needs to be a reversion to long-term goals, which means long-term rewards. Until that happens, I fear that good (great?) staff will be lost to these entities.
Roy
Lets come up with some new concepts – My service is my product and I hire it out to others either in a way that they pay me by short or long term contract. They do not own me. I will provide the agreed service + a little extra and I will work hard doing what I believe is in the best interest of my client – the “organization”. I will leave on the day I feel that I am no longer valued, I no longer trust the people I work with and I no longer can do my best or keep my word. I will stay through thick or thin if I believe I can make a difference, I am responsible for me. You do not own my soul. Big business, you do not own me, slavery is dead. If we remember where and how responsibility lies we can do amazing things and accomplish the spectacular or at least the ordinary that makes life meaningful.
New thinking is definitely what is required for leaders and followers
Roberta Budvietas, recently posted..What your Attire says about Your Business
Great statements, Roberta!
It’s not just big business- but NO business that owns you.
Roy
Your blog post really struck a nerve with me. When I was in the corporate world, I saw this happen all of the time. Those of us who were doing well and making money for the company, were often overlooked and noticed management spending more time on new hires. They didn’t reward us for our hard work and subsequently, many of us left. Maybe I should thank my last employer as now I’m happily self-employed. 🙂
Lisa Kanarek recently posted..5 Organizing Products Someone Needs to Invent
While it certainly set you off on your own path, Lisa, it also caused you to harbor negative feelings to the corporate world. In the long run, that does our economy more disservice. But, the good thing is that you personally are better off.
Roy