Retaining Employees

"Retaining Employees

It isn't all about the money. This may be obvious, but when employees leave, most managers offer them more money. Why? Because it is the easiest fix, or at least they think it is. In today's fast-paced technology companies, compensation is important, but employees leave for a variety of reasons. Understanding these reasons can give you great insight into your group's dynamics and fundamentally help build a great company. Employee retention has to be a top priority for management, all the way up to the CEO.

Setting Up the Right Environment
The first question to ask yourself is: "why do employees quit?" Extensive studies of exit interviews show that most employees quit for one of two reasons: 1) they hate their manager; 2) they are no longer learning anything and are unchallenged. Addressing these issues from the start will set up an environment where employee retention -- even in this market -- can be 90% or higher.

How to Keep Employees From Hating Their Boss
Step 1: Teach your managers to manage
Most employees who hate their manager, hate them because they do little or nothing to develop or motivate the employee. Managers often perform poorly because they are completely untrained.

It's really, really hard to invest in something strategic but not urgent like training your managers, but remember it's one of two things that you can do to improve long-term retention.

Developing the right managers begins with the interview process. It is important to hire people into positions they can handle and to make sure that managers actually want to be managers. Once a manager is in place, training is a necessity. Each manager has a different style and some gel better with a company's environment than others. It is essential to help managers grapple with the environmental issues and continue to help them develop. Regularly scheduled sessions on topics like management basics, selling a new hire on the company, negotiating compensation, building a killer team, re-selling employees and reviewing and rewarding employees will dramatically improve management skills. Find the right people on your executive team to lead these sessions and managers will attend the same class every few months to get something new out of it.

Step 2: Make sure that they learned something
Now that the right set of people are managers who are learning and developing, it is essential to track their progress. When you review managers, it is extremely important that you spend time with their employees. It is very difficult to evaluate management quality from above; you must look below. When talking to an employee about her manager be sure to ask thought provoking questions such as: "if I were to promote your manager to the next level tomorrow, what would your objections be?"

Avoiding the My-Job-Is-Boring Syndrome
Growing Employees
You can't promote employees or give them more responsibility if they aren't ready, but you also can't leave someone to boredom. Attack the problem at the root -- assess employees' skill sets in the interview process and then carefully define a job in which they can succeed. Giving employees more responsibility than they can possibly handle is setting them up for failure. At the same time "Dream no small dreams for these have no power to move the hearts of men" (Johann Wolfgang Von Goethe) -- set employees up to push themselves to succeed. Be sure to communicate the vision of the company and how the job fits into the vision. If employees understand how they impact the company's success they are much less likely to feel like they can't make a difference.

Once in well-defined jobs, it is much easier to evaluate employees' performance. Communicate often and always; always listen and seek to understand what is enabling an employee to do great or what is inhibiting an employee from doing great. Frequent formal reviews are a necessity. Having a good understanding of what is going on in an employee's head will dramatically improve your ability to enable them to succeed.

Now that you have identified the employees who are bored, doing great or need help, it is crucial to act on your findings. In today's environment, only meritocracies will survive. When employees are ready for more responsibility or another job, move them -- period. When they have too much responsibility, eliminate some of their tasks so they can succeed.

Ongoing Learning
Learning is one of the most crucial attributes of a job. Most people enjoy learning and like a little challenge. Setting up an environment where all employees are encouraged to learn and help others is key. Part of the upward feedback process should be an evaluation of what employees have learned from their managers. A great employee who can teach 10 people everything that makes them great is ten times more valuable than an employee who is simply great. This attitude must start with the CEO. When teaching and learning become part of the culture, immature raw talent develops into the backbone of the company. People are excited about their jobs and feel like they are getting a valuable experience -- not just earning a living.

Regularly scheduled classes where employees who are experts in different areas share ideas with their co-workers can jumpstart the teaching environment. Giving incentives to employees who go out of their way to teach, and hiring enthusiastic people also fuel the environment.

When Someone Says She's Out
Despite your best efforts, extenuating circumstances will always make some people leave. No matter the reason or "rank" of the employee, it is important to understand their reasons for leaving. As soon as employees tell you they're leaving or you hear that they might be considering it, stop what you are doing and sit down to listen.

Understand their thought processes and the conclusions they have reached. Listen to the complete story, as there will undoubtedly be points of interest to you. Next, address their concerns. Be open-minded and admit flaws where there are flaws. Explain things that are being done to help address the issues. If an employee is leaving for a bigger job, seriously evaluate whether that person is ready for a bigger job. If you think they are, offer them a promotion and ask them to stay; if you don't think they're ready, explain your reasoning.

Finally, apply what you've learned. Chances are other employees have the same concerns and will appreciate your efforts. One of the biggest problems today is the sinking ship phenomenon -- at first, a few employees trickle out and then the floodgates open and people pour out. Quickly fixing problems will keep the ship afloat. Fundamentally, high employee retention is part of a great company.

- Deb Casados & Ben Horowitz"

<Note from JobFairy.com: Never give in to the temptation to grant a company an exit interview. Just pack your stuff, get your files off the PC, and leave with as little notice as you can get away with. Sign nothing unless your lawyer reviews it. Never say where you're going or that you're getting paid more. Don't mention that you're getting that promotion they never could seem to give you. That stuff could come out by mistake in the heat of an exit interview. Make sure you get paid for the remainder of your time there and your vacation, if you have any accrued, and get out. You do not owe them the courtesy of a final turd hunt.>