Good Retention Takes More Than Money

In a post at Compensation Cafe writer and strategist, Derek Irvine, talked about the importance of money in retaining good employees. He pointed out that while money is important to retention it is not the only thing that is important. In discussing a Wall Street Journal article Derek points out that recognition is also a very powerful tool.
This has been my experience. While many employees stay today because of fear they are poised to move when the economy gets better. We have all heard those numbers. They should be striking fear into the hearts of many employers. According to Derek finding a new employee is much more expensive than retaining the one you have, especially if that employee is “high potential.” Yet according to the Wall Street Journal article (which appeared in print on October 10, 2011) only 68% of companies know who their “high potential” employees are and only 28% have let those employees know that fact.
I know there are some arguments against telling someone they are “high potential” (in the days before political correctness they were known as the “fair haired children” of the organization) but when someone is truly critical to the company it is both important to know that and for them to know that. In these times of not being able to give people money it becomes CRITIALLY IMPORTANT TO GIVE THEM RECOGNITION. This applies in particular to “high potentials” so they know that the organization will be most likely making an investment in their future.
That thought leads me to ask you FOUR questions:

  1. Have you identified your “high potential” employees? The ones that will be critical to the success of your company?
  2. If the answer is NO, then I ask WHY NOT?
  3. If the answer is Yes, then I ask HAVE YOU TOLD THEM?
  4. If the answer is NO, then I ask WHY NOT?

To get more detail on this read Derek Irvine’s excellent blog post at the Compensation Cafe: Retention & Compensation: Keeping Them Is Cheaper than Finding Them.

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