By Chelsea McClain and Elizabeth Pulliam
As 2022 speeds by, employee turnover continues to head the list as a top HR concern. However, Patty McCord, who was the head of HR at Netflix for 14 years and the author of Powerful: Building a Culture of Freedom and Responsibility, has a different perspective. McCord says that retention rate should not be the metric a company follows. Everyone serves a particular function in a business, and once that function is complete, even the high performing employees need to move on. The key employee turnover metric McCord says to follow is how many high performing people you have in the right positions in your company.
While I agree with this in concept, I also believe in supporting and assisting in the career path development of our employees. Promoting from within before hiring from outside, as business author Jim Collins promotes, definitely has a long list of merits.
So, how are things looking? Are you working hard to fill your seats with rockstars only to have them poached by head-hunters? Yes, it’s a problem. But employees will not so easily be lured away if these three components exist at your company: 1) feeling valued, 2) a good company culture, and 3) good compensation.
If you make sure your employees know you value and appreciate them, they will be less likely to answer a call or email offering a new opportunity. PMG employs a variety of methods of showing appreciation. My favorites are mentions in our company newsletter, special emails sent to everyone highlighting the exceptional service of one employee, and celebrating special events with each other. One of our work teams recently did a Zoom bridal shower for one of our newer employees where they used specially created Zoom backgrounds and played bridal shower games.
According to the 2021 Workplace Friendship & Happiness Survey by Wildgoose, 57% of people say having a best friend in the workplace makes work more enjoyable, Twenty-two percent (22%) feel more productive with friends, and 21% say friendship makes them more creative. So, what can be done to foster a good company culture where people can connect with each other on a personal level? There are many ideas online to try, but in this work-from-home environment, we connect through:
- Slack or Teams groups
- Special in-person get-togethers like company-sponsored meals
- Online trivia games as part of our company meetings
- A sunflower growing competition
- and more.
Be creative and try different things to see what works best for your teams.
Finally, as far as the first two can take a company, competitive compensation is essential as the third component to finish out the rest of the circle. But what is compensation? Not all compensation comes in the form of money. Meaningful work and meaningful relationships actually top the Millennials’ and Gen-Z’s list of compensation priorities over money. Associations have an advantage here, as it is typically the goal of an association to “change the world” in some way. PMG will only partner with a client whose mission we believe in, and we look for team members who feel the same way. Because we work hard to create a company culture that supports this, we naturally create friendships around shared perspectives and goals. Satisfaction in one’s job closes the circle of feeling valued and having a good company culture.
Not sure where to start regarding employee turnover? Ask your employees! And don’t feel like it needs to be an anonymous survey See what Patty McCord says about those in her book Powerful: Building a Culture of Freedom and Responsibility.