As we described in last week’s blog on stay interviews, retaining qualified employees is top of mind for leadership teams at most organizations today. In fact, the Conference Board report, C-Suite Challenge 2018, that asks 1,000 business leaders about their challenges finds that talent ranks as the foremost concern among CEOs and others in the C-Suite, including CHROs and CFOs. With intense competition for talent, stay interviews have increasingly become a key retention technique to stay connected with consultants and understand if they are happy, motivated and professionally fulfilled or identify if there is a retention concern.
With the national unemployment rate at 3.9%, how do organizations keep the workers they have and attract new ones? While we were living in a different economy 10 years ago when the book Drive: The Surprising Truth about What Motivates Us, was published, author Daniel H. Pink tells us that autonomy (let me do the job on my own terms), mastery (helps me develop) and purpose (align with a company with a higher calling) are the factors that drive employees.
To revisit retention, Simpplr, an employee communications firm conducted a survey of managers at companies on the Wilshire 5000 (a broad index of publicly traded U.S. firms) and analyzed overall performance ratings of companies by employees on the jobs site Glassdoor, the largest source of engagement data publicly available. The findings are as follows:
Culture matters. According the survey, 40% of workers are likely to leave their jobs in the next 12 months. Looking at the Glassdoor data, the researchers found that employees at companies with low overall ratings are five times more likely to leave their current positions than those in the top third. Companies doing well on Glassdoor, they reason, are doing something right about corporate culture and keeping employees.
From the Glassdoor ratings, the researchers further found that employer ratings are a key indicator of retention. For example, culture and senior management ratings are good predictors of overall ratings. In fact, anecdotally, they are almost always the same, and a sign that executives need to take responsibility for company culture.
What’s more, employees who give their companies high overall ratings on Glassdoor are excited about going to work; those who rate their employers poorly are not.
Excited about going to work! Being excited about going to work is a definitive measure of engagement. So, the researchers asked the question in their survey: What makes you excited to go to work in the morning? The responses were:
- Proud to work at the company
- Personal values align with those of the company
- Useful work
- Understanding of contribution to the company
- Feel sense of community at work
The researchers categorized these responses into three buckets: purpose (proud to work, personal values), alignment (useful working, understanding contribution) and community (feel sense of community). Diving deep into the data, the researchers found that:
- Alignment. While according to the survey just 15% said front line supervisors can recite the company’s strategic priorities on the spot, understanding strategic priorities matter to engagement.
- Community. Employees who feel their companies care about them are excited about going to work. Having a sense of community matters to employee engagement and helps retain employees. Survey findings corroborate with Gallup research that shows having a best friend at work cuts down on employees leaving a company.
- Purpose. Aligning personal values with the values of the organization and having pride in working there are other factors important for driving employee engagement.
Key takeaway: Companies willing to invest in culture and engagement will have happier employees, which can result in improved employer ratings on Glassdoor. Long run implications is that companies will reduce employee turnover and attract new employees, lowering acquisition costs and, ultimately improve productivity.
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Also read the Genesis10 blog, In a Hot Talent Market, Stay Interviews and Employee Engagement Important for Retention.