A recent issue of Entrepreneur Magazine reports on a poll conducted in conjunction with PricewaterhouseCoopers to determine the biggest challenges for entrepreneurs. The data showed that 73% rate “retention of key workers” as their #1 challenge. The most interesting thing about the poll is that this issue scored almost twice as high as #2, “developing new products and services” at 38%.
Along with reporting the data, the magazine provides a sidebar about how to deal with the issue of retention. The headline is great, “Make your Employees Matter” but the content is about offering competitive retirement plans and allowing key employees to share financially in the company’s growth. Problem is, focusing on money matters does not retain employees because it doesn’t make your firm unique. Anyone can offer competitive pay and benefits making it easy to jump from one job to the next for more money.
Silicon Valley firms discovered this back in the late 80s and early 90s when tech started to boom. Workers viewed all the employers in the Valley as one big company – they jumped from firm to firm depending on the challenge of the work or loyalty to someone they enjoyed working with. It is still common in the technical arena for entire teams of product development people to move together to another employer. They do this because of the relationships and working partnerships they’ve developed.
A few years ago The Gallup Organization did the largest study of employee issues ever conducted – interviewing 30,000 successful managers about their techniques in keeping employees satisfied. They uncovered 12 workplace characteristics that good managers use consistently to retain and motivate employees. Guess where money or any kind of financial reward stood on that list? Give up? It wasn’t even mentioned.
This research resulted in an excellent book by Marcus Buckingham called, “First Break All the Rules.” The title derives from the fact that all the basics you learned about management in B-school are not what work for really excellent managers. The book revealed the twelve most important rules to use. Here they are:
Employees want to
1. Know what is expected of them
2. Have the materials and equipment to do the work right
3. Have the opportunity to do what they do best every day
4. Frequently receive recognition or praise for good work
5. Have supervisors who care about them as a person
6. Be encouraged to pursue self development
7. Have their opinions count
8. Feel their job is important based on the mission/purpose of the organization
9. Have co-workers who are committed to doing quality work
10. Have a best friend at work
11. Be talked to about their progress regularly
12. Have opportunities to learn and grow
Based on this research, Buckingham observed that “Employees don’t leave companies, they leave managers.” Think back to the best job you ever had. Wasn’t it great because you enjoyed and respected your manager? Didn’t you have a great relationship with that person and the others with whom you worked? Loyalty to a job is really about loyalty to the people you work with – they’re the logical human connection.
So yes, Entrepreneur’s headline is correct. Meet the #1 entrepreneurial challenge by “Making Your Employees Matter” but in a very personal way – by breaking the traditional rules.