Top talent a flight risk in tough times

Employers should pay more attention to the needs of their top talent or they’ll lose them, a new study warns. In hard times, businesses look to their top performers to help keep the company above water, but the study, by consulting firm HayGroup, indicates motivating this group to deliver on performance isn’t easy.

The report, Managing Performance: Achieving outstanding performance through a culture of dialogue, surveyed 335 companies worldwide. Only one-third of employees reported feeling that improving their performance would translate into better compensation, and about 32 per cent said poor performance is tolerated in their organization. This is similar to the findings from another new survey, by Aon Consulting, which indicated that organizations are at great risk of losing key talent because they don’t feel tied to the organization. Approximately 52 per cent of those surveyed in Canada @Work 2001 said they would leave their current employers for a 20 per cent pay raise.

“If there’s uncertainty, top talent are the first people to go and look for other opportunities,” said Eleana Rodriguez, a senior consultant at HayGroup.

High performance is determined by the way companies set goals and objectives and communicate them to employees. If you take a look at the top teams, the single factor behind their success is they have a high degree of clarity about goals. Superior teams will be very clear about this, said Rodriguez. Around 27 per cent of those employees planning to leave their company in two years said their employer did not have a clear sense of direction.

Rodriguez also suggested in the report that some business managers lack the organizational will to decide who the top employees are. They evade confrontation and lump all employees in the same category, she said.

“Many mangers instinctively avoid potentially difficult performance management discussions with employees. Instead, they choose the path of least resistance, spreading pay increases and bonuses out almost evenly — like ‘peanut butter’ as one manager cited in the paper.”

While Rodriguez highlights the problems, she also offers a few remedies. Businesses should: create a more dynamic performance environment (even in a downturn), build clarity around goals, and create systems that support clarity and top performance and make rewards count. This is what employees want, she said.

General Electric is a company that has caught on to these ideas. In fact, Terry Peach, Toronto-based manager of organization and staffing for GE, said they have always paid attention to high achievers.

“We have a history of making sure we motivate top talent. It’s been important to GE all along,” said Peach.

What’s even more important is having clear and simple goals that are understood by all employees. It’s hard to find an employee who couldn’t recite what the four clear strategic initiatives are, he said. Within each business department, there are different goals tied to the overall strategic business objectives.

GE employees know what to expect if they exceed performance expectations, said Peach. They are rewarded and recognized with a well-differentiated rewards system. GE ranks employees every year and identifies the top 20 per cent; they get a much larger increase as opposed to the bottom 10 per cent who don’t get any pay hike. Employees that range in the middle are paid competitively as well, Peach said.

GE also makes it obvious there is room for advancement.

“The jobs are so diverse here, people can have significant career growth. The sky’s the limit.”

Motivating top talent has also been on the Bank of Montreal’s agenda.

“Top talent is a prized resource and the competition for their assets continue to increase. That’s more of the stimulus behind what we do,” said Neil Conway, senior vice-president of human resources at BMO.

For BMO, learning and development is a definite priority. In 1994, BMO opened an Institute for Learning in Toronto, and it’s one of the bank’s main strategic training and educational tools. The role of the institute is to provide accessible, relevant job-skill training for employees and groom future leaders for the organization. This is a big element and it keeps people motivated by the prospective of moving up the ranks, Conway said.

“It’s a real touchstone for us in terms of demonstrating our commitment to people and their aspirations.”

Anna Ciciretto, director of human resources at Nielsen Media Research in Markham Ont., said offering employees weekly business updates gives them a sense of their contribution to the company.

“We have what we call weekly ‘Pit sessions’ and the reason it’s called ‘The Pit’ is because we go to an area of the office with lots of space and update employees on what’s happened in the last week,” she said. These updates can range anywhere from five to 25 minutes. The topics can include what’s happening in the U.S. chapter of the company, and they also hand out employee recognition rewards from time to time. Employees can also e-mail questions beforehand to HR or the president to be addressed at the pit sessions. A culture of dialogue is very important, that’s what makes people really buy into felling a part of the organization, Ciciretto said. They have the opportunity to know what’s going on and we find they buy-in.

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