NEWS
How Talent Management Can Help Businesses Retain their Best Staff
In my recent article, I discussed the skills crisis that is currently besetting the construction industry and what the sector should do to attract more skilled personnel. However, many of the changes suggested in that article will take time to sink in. In the meantime, businesses need to focus on maximising their productivity by nurturing the staff they already have.
A recent Gallup report estimates that the cost of hiring a new employee can be as much as twice that employee’s annual salary. With the war for talent intensifying and margins still tight for many businesses in the sector, the benefits of retaining key staff members and keeping them motivated and engaged are significant.
Talent management is vital in making that happen, but many businesses still rely on a combination of manager intuition and employee feedback. When either of these factors is unreliable, the result is poor staff retention rates and higher business costs. Implementing effective talent management strategies is key for firms looking to get the most from staff and retain vital skills and experience.
Doing so requires a focus on four key areas: performance management, career growth, employee engagement and compensation.
Performance Management
To be truly effective, talent management processes require regular contact between employees and their managers. Performance appraisals give managers a valuable opportunity to check in with their staff and ensure they can perform effectively in their roles or identify areas where adjustments are needed, boosting productivity.
Performance appraisals also provide line managers with the opportunity to gauge their employees’ current levels of engagement and identify their goals and plans. This can make it easier to monitor team morale and can ensure employees feel that their ambitions are taken seriously, increasing their engagement and commitment.
However, for managers and employees to get the most out of performance appraisals, they must be structured and reliable. Employees need to have confidence in the process if they are to provide honest and helpful feedback, and their managers need to be clear about what they are evaluating and how this should be measured.
Managers may benefit from additional training on how to conduct effective appraisals and provide constructive, strengths-based feedback. Techniques such as motivational mapping can be a powerful resource for managers, providing them with a sophisticated language for understanding employee motivations and translating them into effective actions.
Career Growth
Ensuring that your employees have opportunities to grow in their roles and advance within the company is another critical plank of effective talent management. According to a recent study by Harvard Business Review, 93% of employees would stay longer at a company that invests in their careers. Giving employees opportunities to develop and progress doesn’t just increase the chances of employees staying; it also increases the range of skills and the level of experience within the business.
This is something that should begin as early as the onboarding process, ensuring that employees settle into their roles quickly. Once staff are up and running, their line managers need to ensure that they have regular opportunities to pursue further growth. This can be achieved in a variety of ways, whether through formal training, mentoring, and online courses or more informal learning from peers, managers and other industry experts.
Good communication between line managers and their employees is critical. Managers who don’t have a clear understanding of how their team members intend to progress will almost certainly fail to provide them with the right opportunities. Conversely, team members who aren’t open about their ambitions may miss out on opportunities.
Employee Engagement
It should come as no surprise that employees who are happy in their roles are more likely to stay at their companies. Indeed, a 2022 McKinsey survey reported that those with a positive employee experience had 16 times the level of engagement of those with a negative experience and were also 8 times more likely to want to stay at their company.
While workplace happiness can be hard to quantify, there are a range of factors that tend to contribute strongly to the happiness of teams and team members. On an individual basis, ensuring that team members have clear responsibilities and feel engaged by their work goes a long way, and has obvious benefits for worker productivity. As we have seen, ensuring that employees have a clear sense of the ways in which they can progress at work is also essential to workplace happiness.
On an organisational level, making sure that team members understand your values is crucial for building a strong corporate culture and keeping employees engaged and committed to their roles. Robust and visible EDI policies are also powerful weapons when it comes to ensuring that minority team members feel adequately supported and welcome.
Compensation
Although compensation is certainly a key consideration for retaining staff, and it is vital to ensure your most valuable staff are well rewarded, the importance of pay when it comes to retaining staff can be overstated. 80% of employees who accept counteroffers and agree to stay with their current employers end up leaving within a year anyway. This shows that while money is an effective short-term incentive, the fundamental reasons for leaving or staying in a role tend not to be financial.
As a result, while ensuring your salaries correspond to industry benchmarks is critical, pay rises alone are unlikely to be enough to retain staff who are thinking of moving on. In the construction sector, where many businesses have been feeling the squeeze for years, it might not be possible for some managers to offer pay rises even when they want to. However, those able to implement robust talent management processes are more likely to understand key motivators for their staff members and give them compelling reasons for not walking out the door, taking years of experience and vital leadership skills with them.
Aylin White has spent decades working in the real estate and construction sector, acting as a consultant for businesses interested in honing their talent management strategies. We’ve seen first-hand the benefits it can have for businesses looking to get the most from their best people and retain them for longer. If you’re ready to enhance your talent management strategies we’re always available to discuss how we can help, so don’t hesitate to get in touch.
David Perdoni.
david.perdoni@aylinwhite.com | +44 (0) 7961 275 312