Talent Tip #68: Ask the Magic 8 Ball: Why do Employees Leave?  

Do you remember those Magic 8 Balls? You pose a yes/no question and then turn it over to reveal the answer. My childhood friend and I used to ask the Magic 8 Ball whether the handsome and oh-so popular neighbor boy would ever give us the time of day.  We would turn that puppy over 100 times until it told us what we wanted to hear: “All Signs Point to Yes.”

Speaking of questions you are dying to know the answer to, many nonprofit organizations wonder why they experience employee turnover. One way to figure it out, of course, is to ask the Magic 8 Ball.

You: “Are we experiencing turnover because of our management style?”

Magic 8 Ball: “Reply hazy. Try again later.”

You: “Are we underpaying staff?”

Magic 8 Ball: “Concentrate and ask again.”

You: “”Is it because we recently dropped healthcare coverage?”

Magic 8 Ball: “Better not tell you now.”

But why rely on a plastic sphere for an answer this important? How about I just tell you the most common reasons I hear from candidates about why they want to make job changes.

• Culture – Unhealthy or negative environments chase off employees faster than you can say “dysfunction junction.” The laundry list of culture complaints I’ve heard is worthy of daytime television: overbearing bosses, egomaniacal CEOs, cultures of secrecy and distrust, nepotism, broken promises about raises and promotions, inept leadership – you get the idea. If your organization is battling culture problems, now is the time to address and correct. Denial ain’t just a river in Egypt — and it could cost you your best employees.

• Fiscal Instability -If employees sense their organization is in fiscal trouble, they will often start making their way to the door. Even if financial ruin is not on the horizon, employees fully understand the nature of the nonprofit world and the fact that staff cuts may be forthcoming. Instead of waiting and wondering, they choose to write their own script. In this case, management obviously needs to address the issue directly (cutting costs, increasing revenue, etc.). In addition, management may want to communicate openly and honestly with staff about the  situation. Often times the rumors are worse than the reality; so, unless management communicates, the rumors will win.

• Money – Not surprisingly, candidates often start looking around if they feel under-compensated. This is especially true for the high performers who are often tempted by other job offers. If your organization is not paying market rates, I pinky swear you are paying for it through attrition. What’s worse, your reputation for underpaying will spread and eventually create a hurdle for hiring.

• No Room for Growth/Lack of Challenge – Many people who are drawn to our free-market world of ideas are inherently curious and love to learn. That means they want to be continuously challenged and have opportunities to grow, learn, and get promoted. If yours is the type of organization with little room for growth, know that up and coming top performers likely won’t last long. If possible, find opportunities for your best employees to take on new challenges and grow into new roles.

• Lack of Fulfillment – The good news for my free-market nonprofit clients is that this is something I rarely – if ever – hear from people inside our world. I usually get an earful  about lack of fulfillment from people in the private sector or (surprise!) the public sector. That said, employees at liberty-advancing shops still want to work at a place that is clearly and effectively advancing its mission; and they especially like to see the results of their work. The clearer these things are, the more fulfilled your staff will be.

So, there you have it. If your organization is facing turnover problems, consider whether any of the above reasons may be factors.

And if you’re wondering, the neighbor boy did come around. In fact, we became high school sweethearts. Maybe you can trust the Magic 8 Ball!

Talent Tip #67: The Key to Employee Retention: Convoluted Algorithms or Simple Communication?  

The Wall Street Journal recently featured an interesting article about predicting impending employee departures based on complicated algorithms.

It turns out some large companies such as Wal-Mart and Credit Suisse are hiring human resources analytics firms to develop intricate formulas that identify which employees might be getting antsy. These company-specific formulas involve a variety of data points, including “job tenure, geography, performance reviews, employee surveys, communication patterns and even  personality tests.” The idea, of course, is that these algorithms allow the company to proactively take steps to retain its most valuable workers.

Sounds like quite the Rube Goldberg approach to employee retention, doesn’t it? I can’t help but wonder: does it have to be that complicated?

Sure, if you are Wal-Mart and employ more than a million people in this country alone, perhaps investing in a complicated algorithm makes sense. But let’s say you are a small or mid-sized nonprofit – what then?

Here’s a simple idea that’s just crazy enough to work: TALK TO YOUR EMPLOYEES.  

As you can imagine, I get a lot of calls from employees who are looking to make a job move. Inevitably, I ask why they want to make a change. What’s striking is how many of these reasons could easily be addressed by an alert and caring employer.

Heck, if I had a dollar for every unhappy employee I talked off the ledge, I’d have enough money to buy a pair of Jimmy Choos. But shouldn’t employers identify and correct the situations before I get the call from the disgruntled employees?

If your organization is having problems with employee retention, here are some things to consider:

1. Communicate Regularly with Employees – If you’re not already doing so, open the lines of communication with employees immediately if not sooner. And because employees are often hesitant to bring up touchy subjects, employers should put the onus on themselves to solicit answers to difficult questions: Are you happy? Do you feel challenged? Do you have positive relationships with team members and supervisors? Do you feel valued (financially and otherwise)?  Are you receiving the training and support you need to be effective in your role?

1. Make Performance Reviews A Two-Way Street – If your organization is already using regular performance reviews, take advantage of this opportunity to seek feedback from the employee about his/her happiness quotient – especially from your most valuable employees!

1. Ask (Your Painfully Honest) Friends About Your Organization’s Reputation – Let’s face it: there are some things you just won’t be able to get employees to tell you about your organization. But if you have a direct, honest friend in the free-market arena, that person may be able to shed some light on possible reasons for turnover. Do your best to address these issues with staff sooner rather than later.

Next month we’ll address some of the most common reasons we hear about why employees want to exit stage right (pun intended). Until then, I’ll be dreaming of Jimmy Choo shoes.

It turns out many young adults are sticking around the big cities longer than before. According to a recent Wall Street Journal article, young folks have historically descended upon the country’s largest metropolitan areas “to build careers before taking their talent and spending power elsewhere to raise families.” Now, thanks to an overreaching government induced recession, that trend is slowing dramatically and many people are “stuck” in the big cities.

As one Los Angeles writer put it, it’s like the Eagles’ “Hotel California.”

So, why is it that young adults can check-out any time they like but never leave? Well, for a variety of reasons, including the obvious: well-paying jobs are usually easier to come by in bigger cities.

And this creates quite a conundrum for free-market organizations outside of major metropolitan areas: finding talent. Specifically, the once steady flow of liberty-minded talent coming out of Washington, DC has slowed a bit.

Case in point, I talk to candidates everyday who are hesitant to leave our nation’s capital.  They recognize that opportunities are more plentiful there, and they are nervous to move to a place with only one or two free-market options.

So, what’s a state-based think tank to do in order to maximize talent options? Hire virtually!

You know I’m a fan of remote work, and this is just one more opportunity to suggest it as a beneficial option.

In fact, one of my state-based clients recently hired an accomplished policy director who will likely remain in the DC metro area and travel to the state as needed.

It was a win-win situation that required only entrepreneurial thinking, phone lines, computers, and occasional plane tickets. Not to mention, the state-based group gets more DC exposure – a bonus!

Of course, remote work won’t work for every role; but it’s certainly something to consider. More and more of my clients are jumping on the remote train, and all of them seem pleased with the results.

So, I say…

Welcome to the Hotel California

It’s a lovely place with remote working space. 

There’s plenty of room at the Hotel California

Anytime of year you can work from anywhere.

Roll Tide.

I can’t believe I just typed that. I might break out into hives. As an Ohio native (Go Bucks!) and a Notre Dame grad (Go Irish!), it pains me to support Alabama. But I’ve got to give credit where credit is due: Nick Satan, er…Nick Saban knows how to recruit talent.

Saban’s recruiting prowess has long been a topic of conversation, and a recent article about it got me thinking about what we can learn from his approach. I found three interesting tactics we can readily apply to the free-market nonprofit world.

1. Nick does his homework. 

From the article:

 “Even before Saban steps into the homes of prospects or invites a recruit to his office, Alabama usually has delved “seven deep” into the player’s life, meaning they’ve contacted his friends, family, teachers, coaches—virtually anyone who has had an interaction with that player and shaped his development.”

Wouldn’t it be nice if free-market nonprofits had the budget and staff to engage in such due diligence about a potential new hire? While we won’t likely have this luxury any time soon, we can take the time to pick up the phone and learn about someone before we offer a job. Recon missions can uncover positive and negative information about a candidate that can save a nonprofit money, time, and heartache. I can’t tell you how many times I’ve heard former employers tell me, “If they would have called me before they hired him, I could have warned them!”

2.  Nick doesn’t do egos. 

From a former coordinator under Saban:    

“It’s hard at Alabama. It’s not for everybody. You can’t be an ego guy at Alabama. Nick won’t tolerate it, no matter how much talent you have. But that’s why he goes so many layers deep into a player’s life before really getting serious about recruiting him.”

Alabama passes over some of the most promising high school football players each year simply because the Crimson Tide detects an ego. Meanwhile, other coaches trip over themselves to bring these very egos onto their teams. You can argue for either approach, but Saban’s record isn’t too shabby (four national championships, five SEC championships, two AP National Coach of the Year awards, etc.).

We’ve alll seen the damage that even one big ego can cause to a nonprofit; I imagine conceit can do the same to a football program. Think about it this way: if Alabama can win championships without the megalomania, surely you can do without!

3. Nick cares about physical ability, but he also cares about character.

“In evaluating…players, Saban doesn’t rely on game tape alone. He (or a staff member) always talks to a high school player’s coaches and grills them with questions.

What’s the player’s character like? Can he digest and understand complex concepts? Is he a team leader? Is he a good teammate? What’s his family background? Has he gotten in any trouble at school or with the law? How does he practice? Does he listen? Does he show up on time for meetings and appointments? Does he attend all of his classes? Is he dependable? Is he active in the community? How does he react to adversity? Can he play through pain? How will he perform when 100,000 pairs of eyes will be trained on him?  

Saban, in short, wants to know every possible detail about every player.”

Nick’s onto something here. He knows that physical ability is critical, but so is fitting into the team’s culture.

Likewise, when a nonprofit hires, it makes sense to look beyond whether the candidate has the hard skills for the job. Does the candidate also have the integrity, work ethic, and attitude to fit in with your organization?

After all, how many horror stories have we heard about the employee who was incredibly talented but toxic to the organization?

So, it turns out Nick Saban knows about football and recruiting talent.

Well done, St. Nick. But if you’re wondering, no, I’m still not rooting for ‘Bama.