Find, Hire, Keep – Part 3: Hiring vs. Retaining
When most people think about talent, they think about acquisition – how do you find and hire the right people? Bringing the right people on board is important, but it’s not the only factor to consider when building and nurturing a team.
This is the third installment in a three-part series in which talent management experts Kelie Morgan (Permanent Equity) and Ashley Day (FFL Partners) share experience and insights on how smaller companies can improve their hiring process, employee retention, and what challenges and opportunities lie ahead for operators trying to build great teams.
Kelie is the Director of Talent Acquisition at Permanent Equity, where she leads talent acquisition, building relationships, researching compensation structures and roles, and evaluating candidates for roles at portfolio companies and the firm. She also heads The Orbit, Permanent Equity’s talent acquisition network.
Ashley is an Operating Partner at FFL Partners in San Francisco. She works closely with FFL’s portfolio companies, advising them on all aspects of talent management, recruiting, compensation, succession planning, retention, team building, and performance management.
Hiring vs. Retaining
When thinking about talent, getting to a hire is only half the battle, especially in a hot labor market or if your company is experiencing a downturn. A critical part of creating and keeping a healthy company culture is not only being able to bring the right people in, but also being able to keep them – and to make sure they thrive.
Kelie: One of the biggest things we're thinking about is, “How do we make sure we're keeping people on our team who we want to keep?” The conversation starts with, “How do we patch the holes in our bucket before we worry about pouring more water into it?”
The conversation doesn't need to start with, “How do we hire more people?” It needs to start with, “How do we keep the good people that we have?” And, “How do we make sure that we're creating a culture where the the right people want to stay and the wrong people feel inclined to exit?”
How do you do that? One way is to have clear KPIs so that everyone knows what success looks like and what it takes to get there.
Ashley: How do we know who the right people are? How do we know who is good in our company and who are the people that we want to retain? There are various ways that you can evaluate your talent, but [the first question is] “Are you evaluating your talent?” Do you have a performance review in place? Who are the people who are providing input on those reviews? How often are you doing them? Those are the kinds of questions I would be asking.
Kelie: [For smaller companies, that can be as simple as] implementing a consistent touchpoint from your managers to their direct reports… like a standing meeting every week for 10 minutes. It is really important that you're getting that live feedback on how they're doing and where they’re having success.
Once you have that kind of cadence set up where you're meeting regularly with direct reports, they have an understanding of what the KPIs are, what good performance looks like, that will create a culture where under-performers don't necessarily feel comfortable. Top talent wants to be in a culture where success is rewarded, where high performance thrives.
The other part of not losing them is going to be making sure that you're rewarding them appropriately for their successful contributions to your company.
Ashley: And I think to reward people successfully, you need to understand what motivates that individual. And it's not one size fits all.
Understanding why people stay and why they leave is critical to creating thoughtful processes around retaining your top performers.
Ashley: At a fundamental level, you want to make sure that you’re thinking about who joins us? Why do they join us? Why do they stay and/or why do they leave? If you can get some clarity around those questions, then you've got data… And understanding those answers helps you devise your strategy. If you can understand the top three reasons why people are leaving your company, maybe you can't solve all of them, but maybe you can solve the biggest one, and that's going to plug one of your biggest holes.
People leave their bosses. They don't leave their jobs a lot of times.
One of the things that we track quite often is if people are exiting, and particularly in organizations where you'd have higher turnover rates, at what point in their life cycle do they exit? And so you might see it's in 0 to 30 days, or it's in 60 to 90 days, or it's in the 6 to 12 month period. If there's a trend of people leaving in the first 30 days, there's a disconnect in terms of what we're explaining the job is versus what the job really is because people aren't seeing it through once they get there.
There's a number of things that we know make people stay. There's employee engagement, feeling connected to the business, feeling connected to the people that you work with, feeling that your job has purpose and value, feeling [appropriately] compensated.
Kelie: Along with compensation, the benefits package in general, and feeling like you have upward mobility and a path towards a career progression within your company… During quick and easy check-ins, [you can get] a feel for what they’re excited about. And if there's really nothing currently on their plate that they're excited about, then that's an opportunity for you to figure out what their native genius is, what their best and highest use is, to help create more of those opportunities for them. That’s one way to engage employees that's really specific to their role while hopefully adding value to the company.
And, if you’re looking ahead to 2023 with hesitancy around hiring, know that there are also opportunities to be found in a slower market. In situations where you don’t have the capacity to expand your team, you can still focus on retaining your top performers and developing employees across the organization.
Kelie: We are seeing a slowdown in hiring across many sectors… I think this slowdown gives you a chance to look underneath the hood at your company and devote the time and resources that you were spending on hiring to look at different things like talent development, to start implementing things like reviews or meetings between your direct reports, to figuring out who you’ve got and what they’re capable of.