EMPLOYEE RETENTION
by ArLyne Diamond, Ph.D.

The laws of supply and demand are CLEARLY visible here in Silicon Valley and in other parts of the country with a density of High Tech companies.

Housing costs in the Bay Area compete with New York City for being the most expensive in the country. Our transportation problem gives daily additional testimony to the fact that the demand of people significantly exceeds the supply of available housing, roads, and public transportation. The same problems are developing in the Boston area, the South Carolina Triangle and other High Tech pockets. This skew, here and elsewhere, is harming our quality of life.

The laws of supply and demand are working in the opposite direction when it comes to the labor pool. There is far more demand than there is supply to meet that demand. Not only is this a significant problem for those looking for professional technical workers, it has trickled down to all areas of employment, including retail stores. No where is the problem greater than in the High Tech communities.

Thus recruitment and retention of employees presents a seemingly insurmountable problem for employers still working with old paradigms in these areas.

This article is devoted to retention. A future article will deal with recruitment issues. We'd welcome your e-mail suggestions and creative strategies for finding and hiring talented people.

When we look at the retention issue, the most striking myth we have to dispel is the myth that it's all about money. The money factor (salaries, bonus, stock-options) is rarely the most significant reason people accept other offers.

Consider the power of the laws of inertia. Most people stay unless the pressure to leave becomes unbearable. Even in awful marriages,

most men and many women stay unless the pain becomes more than they are willing to endure. It is only then that they either leave, or open the emotional door to being seduced away. It is no different in business. If conditions are good, the tendency is to stay. If conditions are bad then almost any good carrot (and money is a very sweet smelling carrot) will tempt them away.

Thinking money is the only motivator is to assume that all people value the same things in the same hierarchy all of the time and at all stages of their life. This, as you can plainly see, is a gross over-simplification of what makes people tick.

Certainly, if there were a check list, we'd almost all choose the same values. However, if asked to rank order the list, our priorities would differ. Our personal selection would even differ at different stages in our lives.

When Dr. Abraham Maslow researched psychologically healthy and successful people he developed his theory about the hierarchy of values. Simply, in his schema once a level of values has been consistency achieved, focus and need become directed to the next level. For example, when living in starving conditions, survival needs take precedence over all others. Next in order are needs for basic security, such as shelter.

In our highly educated and highly industrialized society, higher order needs such as self-esteem, challenge, creativity, acceptance, belonging, and even aesthetics are the primary focus of attention.

The notion of shifting priorities and values is critical to understanding employee retention motivators.

The challenge and enjoyment of the work itself, as well as the quality of life in the work environment are significant for most educated people. Others, need the security and comfort provided by feeling close to the people with whom they work. Even at entry-level positions, once the financial threshold has been met satisfying survival and security needs, these other factors become significant.

Quitting is almost always because of incompatibility with managers or a feeling of lack of appreciation and recognition.

Consequently, if we want to retain our employees, we must look primarily to the work environment, its creative challenges, the quality of life within the workplace, and the style in which people are managed, in order to increase our odds.

When turnover is reduced, overall productivity increases, as does "the bottom line". By minimizing the revolving door style of recruitment/retention so prevalent today, costs of recruitment, training, ramp-up, morale issues, and even law suits are reduced. Happy employees tend to work harder, more efficiently, and certainly more creatively.

People appreciate:
Having a say in the work they do and the manner in which they do it;
Being included in the data gathering for process change and other decisions related to their own work (participatory management);
Professional development coaching, Mentoring and consulting confidential to them for their individual benefit;
Management they can trust and respect;
An ability to offer new creative projects to the mix with an allocation of resources enabling the plans and/or prototypes to reach the executive floor, without relying on covert operations (putting the blinders on) and the random "bubble-up theory";
Being recognized and rewarded for effort, participation, team-play, as well as for the numbers they achieve;
Social recognition periodically, like the pizza party, or being taken to lunch by the boss;
Merit increases and bonuses for extra-ordinary effort;
The freedom to be cross-trained;
Having breathing space in time and surroundings so that mental cobwebs can be cleared;
Work space that is neither claustrophobic (tiny high walled cubicles) nor a goldfish bowl (large open bullpens);
Play space, hang out space, open areas with seating, in which informal discussions can take place;
Guidelines and processes that enable them to work easier, be more successful and save time, contrasted with rigid inflexible rules that feel like a series of ridiculous obstacles to be overcome (which is how too many people feel about their accounting and H.R. regulations);
Some team-building and social activities that feel real and not just tokenism.

In addition, those extras that make life easier for employees help tip the scale in the direction of a desire to stay. Among them:

Flexible working hours, including job-sharing, working 3/4 time, 4 day work weeks, etc.
Beautiful surroundings, parks, picnic areas, lakes, waterfalls, walkways, etc.;
Child-care - quality child care;
A great cafeteria and maybe small kitchenettes with snack foods;
Laundry, cleaners, alterations;
Tele-commuting, as well as alternate work hours to mitigate the commute problem;
Extra "allowances" for public transportation, housing, cell phones, travel, and even allowing employees who live more than an hour away to have a hotel room one or more nights a month;
Really clean and well attended bathrooms;
Showers, gyms, lockers;
Company vans to and from train stations, restaurants, shopping centers, etc.;
Bike storage lockers; and
Newsletters that really share what's going on.

Remember, all people are not alike. All needs are not alike and of course not all companies can create the same type of work quality of life. What has been listed here are suggestions to stimulate your creativity in solving your particular workplace needs.

What must be done is to dispense with the old notions developed in the early days of the industrial revolution when the supply by far exceeded the demand. Threats, power-plays, or uncomfortable working conditions will lead people to bite the next carrot that comes along offering a slightly higher salary or stock options. The conditions in today's job-market requires new and creative solutions to management, motivation, and the retention of people.

Article Reprint: Tech Week,
November, 2000