Here is a little insight that top-performing organizations in the country know, while the rest have been slow to pick up on. Recruitment is a seller’s market. There is more demand for labor market than there is a top talent. I’m not talking about simply qualifications or hard skills. There are plenty of degrees and certifications to go around. What is lacking is the soft skills, the grit, the critical thinking, collaboration, and creativity… what I consider the human capital. Human capital is the “knowledge, habits, social and personality attributes, including creativity, embodied in the ability to perform so as to produce economic value” (Gary Becker, University of Chicago).
Human capital is a person’s ability to apply their knowledge in such a way as to bring great value to their organization.
Of this kind of talent, there is a short supply. Those who have it often know they don’t have to put up with working in anything less than a great environment. Top performing organizations in our economy know this is a rare skill-set and they have elaborate strategies in place to recruit, retain and develop this top talent in order to drive their organizations into the future.
Organizations end up with the teams they deserve. Compensation and benefits are clearly important to attract and retain top talent. I find it interesting that so much money is spent on compensation & benefits while management fails to fulfill the needs that employees have been asking for that often cost nothing at all. For three decades, Gallup studies show the top three barriers to employee engagement are:
3.) their immediate supervisor
Without addressing these needs, employers will struggle to retain top talent regardless of what they pay.
It is leadership’s responsibility to make their workplace an environment where the best employees can develop themselves do work they enjoy and believe in, and connect with their workplace. I see three elements to a successful workplace that the employer is responsible for and two that employees must respond with.
Connection: Employees must connect with the work they do with limited distractions and free from heavy processes. They must connect with their team in some way. Not everyone is looking for a bowling league, but nobody wants to put up with toxic coworkers either. Connecting with the purpose of the organization is also important. Not everyone can work for St. Jude’s, but simply being a dependable part of a team is plenty of purpose for most.
Balance: Employees want autonomy to be sure, but autonomy must be balanced with direction, vision, feedback and support. Strong leaders know when to engage their team with each, and when to leave them alone to perform at their best.
Development: Whether keeping contemporary with job skills for their current role or developing themselves for the next move (lateral or upward). In the information age, employers must provide an environment of learning and growing to recruit and retain the best.
Once Employers have created this kind of environment, they need to assure employees are contributing the following:
Value: It is an employee’s job to bring great value to their employer. Whatever metrics this value is determined by, allowing any team member to come up short of delivering value to their team becomes burdensome on the rest of the team. The best performers want to work with other top performers, and they don’t appreciate when coworkers get away with giving less than their full contribution.
Culture: Employees need to contribute to the culture of the team. This doesn’t mean they are to be drones. Quite the contrary. They must compliment the rest of the team with unique talents and insights. Complimenting the culture of the team, and adding to the diversity of thought should be considered in the selection process by management. Once on board, it is the responsibility of the employee to contribute to the culture.
This is what good looks like from what I have seen. Top talent will find this kind of environment. Your work environment will attract and retain the kind of person that will put up with working there. Want to attract the best talent? Create the best work environment.
I find it odd how common it is for firms to punish success while pandering to mediocrity. They end up with the teams they deserve. I have seen this done a few different ways.
When scoring performance reviews, and consequently doling out annual compensation reviews, many organizations require their departments to fit all of their employees on the same “bell-curve,” and give the same percentage of annual increase to dole out among those teams, regardless of performance, skill level or potential. This is a great way to encourage mediocrity. Whether you are a highly skilled leader or you’re punching a clock and going through the motions, you get the same raises to dole out. Thank you, Karl Marx.
Performance metrics often used in organizations to punish superior work. Top performers who prove themselves year in and year out often get higher goals than many of their peers who prove themselves to be average. The problem with this is that bonuses typically tied to these metrics, so top performers are compensated the same as average performers. This isn’t right, but it often happens because it looks better for the manager who has more of his team hitting their metrics than if a few kill their number, while the majority of the team miss their goal. To the victor go the spoils, and let the average performers be driven to reach higher.
Many studies have been completed in the past decade arguing every conceivable angle of the incentive pay argument. I have read enough to determine that if you depend on an incentive pay structure to be your magic bullet to recruit and retain the best talent, you will come up short.