The new rules of retention

These simple suggestions for keeping your employees happy can make a big impact.

By Lisa Kosan
Network World, 02/21/00

Janet Pennel's job is to keep Sears, Roebuck and Co.'s 1,700 IT employees well-trained, professionally challenged and, well, working for Sears. Not an easy proposition, Pennel admits, given the "free-agent" attitude among high-tech workers.

"These are people who know they have hot skills and could walk out the door any minute and get a 20% increase in their salary," says Pennel, leader of Sears' IT resource management group in Hoffman Estates, Ill. "Those who will leave for more money will leave no matter what we do."

The firm makes it clear that its employees are valuable - Sears' 1999 IT turnover rate of 11.7% should continue to stay below the national average of nearly 20%, or drop further, Pennel says: "That's the plan."

Sears' IT retention strategy and the economic forces that drive it aren't unique. Leading businesses recognize they need a strategy for keeping valuable IT employees that goes beyond cash.

After all, people leave firms that offer every conceivable perk, including masseuses and automobile mechanics. More than half leave because of their bosses, says Sharon Jordan-Evans, a Los Angeles leadership consultant and co-author of Love'Em or Lose 'Em: Getting Good People to Stay. Most others leave because they're bored or don't see career opportunities.

"Businesses outside of the IT industry - banking, insurance, retail - have to work harder to recognize that what matters most to people is not the stock options or wearing shorts and sandals to work," Jordan-Evans says. "It's the passion for the work that they do."

Staying power

To make your employees more eager to come to work and less likely to leave, you should:

Foster an open work environment. Hire people with top skills and make sure those skills are shared with new hires. Encourage mentoring, and squelch in-house competition the moment it surfaces.

Be generous with training opportunities. Sears' Pennel spearheaded a project in 1999 to line up training and career advice for the retailer's IT associates. This year, Sears has a project called Competency Transformation. "We know there's a gap between the skills we want and the skills we have," Pennel says. Nearly 80% of the IT staff will be retrained in boot camps focusing on intranet and Internet technologies, e-commerce, Microsoft developments, and telecommunications and call center technologies.

"The challenge with boot camp is that we could reskill ourselves into a hole. We need to do the training, and we need to make people want to stay here," Pennel says. "If they have the skills and that supportive work environment doesn't exist, they will leave."

Rotate staff assignments. Two years ago, The Hartford Financial Services Group created The Hartford Technology Services Company, an in-house IT consulting firm. Nearly 400 IT employees in the technology services company enjoy competitive financial incentives, job feedback, training and a variety of consulting assignments - usually without having to travel.

"People in the technology services company last year went from an e-business project to a specialized sales automation system to a Year 2000 readiness project, all within The Hartford," says John Madigan, vice president of human resources for IT at The Hartford. IT turnover at The Hartford is down to 7.2% from about 10.5% a few years ago.

Stay on top of compensation and new technology. Paul Avalone, director of human resources for network consultant RealTech Systems of New York, says you have to monitor compensation rates and emerging technologies, and make sure your people aren't bored. "We want to make our staff so qualified that everyone wants to steal them and so happy at RealTech that they never want to leave," he says. The company seems to be doing a good job of that based on its turnover rate of less than 8%.

Ask staffers what would keep them at your firm. Find out what will make workers stay, and what would entice them to leave. An employee who is asked feels valuable and valued. "But most managers are too afraid to ask," Jordan-Evans says. "They're afraid they will be asked for something they can't give, typically money."

Be creative with your resources. One top pharmaceutical manufacturer offers yearly bonuses to IT staffers who have top-notch, hot skills. Staffers nominated at the beginning of the year get a bonus of up to 15% of their salary if they stay through year-end. There are also bonuses based on projects or for staying with the company for a predetermined amount of time.

Provide challenging work. Keep employees engaged and constantly stretch their skills. "IT people, not unlike other human beings, seem to really thrive on new knowledge," Jordan-Evans says.

Create career development programs. Sears, for example, has a career development program that exposes its IT associates to varied assignments. The program provides more flexibility and self-management than traditional hierarchies.

Hold managers accountable for turnover. If people aren't leaving for promotions, a clueless manager may be chasing them out the door. Managers must be trained in coaching skills and held accountable for turnover in their departments, the experts agree.