Retaining IT employees by being the "Employer of Choice

1
Retaining IT employees by being the "Employer of
Choice

• Andrew Strathdee - Director,
• Corporate HR Partners Ltd.

2
Home Truths

• Retention is a voluntary act - employees stay
  because they want to
• People will leave..the questions are when and why

3
Key Questions

• What makes us attractive as an employer?
• What are we doing which makes employees
  dissatisfied?
• How are other organisations dealing with the
  problem?
• How do we hang on to our employees and longer?

4
Competitor Information

• Competitor Strategies - Towers Perrin Survey of
  over 300 European Co's - Spring 1997
• Reward and Retain Best Performers
• Link Pay to Organisations Key Success factors
• Achieve/Maintain Market Competitiveness
• Pay for Competence
• Reward High Productivity, Quality and Customer
  Satisfaction

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What was being done?

• Introduction of variable pay
• Reviewing Performance assessment and appraisal
  and linking to pay and Career/skills development
• Reviewing pay and grading structures
• Extending Job/Role Evaluation
• Reviewing benefits, Terms and conditions/Perks as
  part of Total Compensation
• Introduction of Share Schemes

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Why the Change?

• Business Model is changing
• Globalisation of markets and technology
• Move to Customer and Quality Focus
• Address Performance Linkeage
• linking pay to business performance
• Competition for Staff
• The demographic time bomb is still ticking.
• Need for Flexibility
• Improve Competitiveness

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Why the Change?

• Perceived Need for Better Pay differentiation
  based on performance
• Reflect flatter organisation structures
• Respond more rapidly to organisational change
• Reflect broader employee roles
• Enhance ability to value individual skills and
  competencies
• Increase flexibility of base pay

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Employer of Choice

• However, whilst.....
• Employee Commitment was seen as vital
• People were seen as the differentiating factor
• Winning Employee Commitment was the major reason
  for introducing changes to reward
• There was
• Little consequent improvement reported in
  employee commitment and morale
• Hardly any changes introduced with the benefit of
  employee consultation - only 12 reported doing
  this...........

Are we surprised?
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Being the Employer of Choice........

• Employees need to be part of solution
• We need to listen to them
• We need the data - look at Opinion Survey Results
  as well as
• Focus Groups
• Manager Reports
• HR Statistics
• They tell you the hot issues - we all need to
  address them.

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Employee's perceptions at Lotus

• Growing Up Lotus... learn to be a big
  corporation without losing sight of the core
  values that make Lotus unique.
• Effective Management... ensure that managers are
  as skilled in managing people as they are in
  developing software.
• Customer Connection... bridge the gap between
  what employees know about satisfying customers
  and what Lotus does to effectively deliver that
  expertise to those customers.
• Market Attention... stay ahead of competitors
  through smart investments, aggressive marketing,
  and wise use of resources.
• Valuing the Individual... provide fair reviews
  and reward programs, alternative career
  development options, inclusive communication, and
  consistent administration of policies and
  programs.

Source - Towers Perrin Lotus Opinion Survey
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Employee's perceptions - why choose Lotus?

• Lotus... Keep "being Lotus" without losing sight
  of the core values that make Lotus unique , ie.
  not bureaucratic, delegates decision -making.
• Effective Management... Develop Managers who have
  time to consult, coach, listen and lead -
  management is a skill which needs time and
  training.
• Winning Team... stay ahead of competitors and
  building public image that makes you proud to
  work for Lotus.
• Valuing the Individual...Offer training and
  career development options, inclusive
  communication, consistent administration of
  policies and programs and facilitate the
  integration of work and family.
• Pay and Benefits...Not generally an issue

Source - Towers Perrin Lotus Opinion Survey
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Employer of Choice - Employee's perceptions
Q? What would most likely help to retain good
performers? selected Better career
advancement opportunities 27 More effective
management of people 20 Better pay and
benefits 15 Less work pressure and
stress 10 Access to the latest technology
Technical
Source - Towers Perrin Lotus Opinion Survey
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Which one item would most likely result in
retaining good performers at your company?
(Result in Percentages)
Employees Perceptions
Source CHRP/Hayward Survey - 1999
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Employees perceptions
The following six items could motivate you to do
your best work. (Divide 100 points between the
six elements, giving the most points to the items
that motivate you the most, and the least points
to those that do not. You may put all your
points on one item, but your total must 100.)
Source CHRP/Hayward Survey - 1999
15
How do you rate your pay compared to what you
believe other companies offer for similar work?
Employees Perceptions
Source CHRP/Hayward Survey - 1999
16
How would you rate your pay compared to what
others in your location doing similar work
receive?
Employees Perceptions
Source CHRP/Hayward Survey - 1999
17
How would you rate your benefits package compared
to what you believe other companies offer?
Employees Perceptions
Source CHRP/Hayward Survey - 1999
18
To what extent is your company successful in
attracting and retaining the people it needs with
its current pay and benefits package?
Employees Perceptions
Source CHRP/Hayward Survey - 1999
19
Employees Perceptions
To what extent do you agree that compared to
other companies of the same size, your company
will provide good opportunities for you to
advance your career and develop your potential?
Source CHRP/Hayward Survey - 1999
20
Employee Perceptions
In general, compared to other companies in your
industry, how would you rate your company as an
employer?
Source CHRP/Hayward Survey - 1999
21
Employee Perceptions
Is it likely that you would look for a job
outside your current employer in the next six
months?
Source CHRP/Hayward Survey - 1999
22
Employee Perceptions
Your Company is clearly changing for the worse or
better?
Source CHRP/Hayward Survey - 1999
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Aligning a New Reward Strategy ......The Deal
Business - The Strategic perspective What the
business requires to succeed
Organisation - The Systems Perspective How the
organisation operates, implements and manages
Culture -The Employee perspective What employees
need and perceive
Source - Towers Perrin European Survey 1997
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Building "line of sight" from business strategy
to the deal
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Employer of Choice
The Deal - TheEmployee's Viewis Holistic - the
elements must be taken together
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Where do we go from here?

• It's not Rocket Science - most of us have the
  right tools already....
• We have the Vision and the Mission, what we lack
  is the Delivery!
• Employees are taking the holistic view of Reward,
  it is not just pay and benefits.
• To be the employer of choice we need to meet
  those TOTAL reward needs.

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So - how do we hang on to them...... and longer?

• Know your Employee Profile - analyse the
  population, age
• Review Market evidence internal and external
• Identify quickly fixable problems - what are your
  employees thinking about...
• Pay
• Grading
• Training Commitments?

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Performance Management

• Develop effective objective setting process
• Performance assessment and appraisal - link to
  pay and career/skills development - 6 monthly
  reviews
• Ensure pay review and appraisal run with the
  business strategy and corporate objectives

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People Development

• Develop Career ladders
• Involve Technical Management in the design and
  completion
• Extend Technical ladders in all job families into
  dual ladders
• Ensure recognition of technical contribution
  eg Appoint Chief Technical Officer
• Introduce a Fellow Program
• Complete development plans for individuals
• Improve employability

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Training

• Offer training materials as broadly as possible
  and encourage their use
• Developed Certification programmes either Company
  eg MCSE or CLE or get external validation of
  internal programmes
• Develop Learning Resources Centres
• Contract and ensure delivery of agreed training
• Monitor for improved performance after training
• Target training activities
• Identify training styles
• Make learning an approved company activity

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Communications

• Make good use of the technology
• Develop overall communicationsShotgun mails,
  Company News Online, Company Meetings via Video
  and Teleconferencing, etc
• Ensure Technical and other support staff not
  treated as second class citizens to Sales and
  Marketing - give them a kick-off meeting too.

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Home / Work Balance

• Look at Parenting leave
• Introduce Sabbaticals(eg Extra four weeks after
  6 and 15 years service for a useful purpose)
• Take your holidays programme! (New Idea!!!)
• Keep an eye on hours worked.
• Monitor Holiday carry-over

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Review Contracts

• Look at Family Friendly policies
• Flexible Working
• Extend use of Variable/staggered Hours
• Use the technology - remote working
• Develop new contracts
• Develop Home/Flexible working contracts
• Experiment with Weekly/Monthly Hours contracts
• Promote Job sharing

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Manage Employees Better

• Employees perceive the need for Managers to take
  responsibility for managing and communicating,
  so
• Conduct regular Managing People Training - make
  an essential programme
• Increase profile of Managing people effectively
• Make a key element of a manager's objectives
• Introduce Good Management Awards - nominated by
  staff

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Managing Better in practice...

• Better compliance with current procedures
• Get tough about objective setting and appraisals
  being completed and appraisals conducted on time
• Salary reviews conducted and paid on time
• Consider 360 degree feedback, employee initiation
• Make sure "Line of sight" with business
  objectives is maintained in better written
  individual objectives
• Ensure Manager is responsible for career
  development planning

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Pay

• Reviews Pay in line with business cycle (?6
  monthly in technical areas)
• Reward performance fairly against the criteria
• Use Discretionary Bonuses (frequently budget
  under-used)
• Variable pay - to link to business success
• Stock schemes to link reward to Business growth
• Incentives Schemes

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Recognition

• Develop recognition mechanisms
• 100 and Achievers Clubs
• Awards - Wizard etc.
• Team and Individual Recognition
• Use more small awards
• Dinner for two etc
• Shopping Vouchers
• Events
• Bottle of champagne

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Benefits

• Review against total remuneration model
• Allow more flexibility within the model
• Give more choice in Pensions - especially
  investment choices
• Make Car leasing widely available

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For the Future?

• What about time management as a motivator?
• Encourage family responsibilities to be
  considered in objectives - not just "work" based?
• Improve communication and report back and involve
  at all levels - staff report back sessions
• Publicly recognise good work outside the Company?

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Conclusions

• The solutions are not simple or complete - they
  are a complex mixture of doing many things better
• Reward is much more than pay and benefits
• Career development, skills development and
  improving employability are crucial
• Know your employees and listen
• Retention is better than recruitment, even if
  only an extension of length of stay
• Make sure leavers are friends of the organisation