HR’s Greatest Challenge: Driving the C-Suite to Improve Engagement, Retention

The confluence of data is striking: Voluntary quits have skyrocketed for six consecutive years, while Gallup says engagement has been flat since 2000. Fewer than one-third of employees do their best while Deloitte tells us we spend $1.53 billion each year to “fix” employee motivation and engagement And CEOs report that talent is their greatest worry, while in one study, HR confessed that its two greatest challenges are engagement and retention.

So HR is caught in a dangerous race. Our CEOs want us to fix talent, yet they don’t know they hold the keys. How can we drive them to make the fixes instead of pushing the task onto us?

I suggest a five-step model for encouraging company executives to take the lead in solving engagement and retention issues as only they can because they bring authority, whereas HR can only bring influence. The five steps are:

1. Convert turnover and engagement numbers into CEO language, which is money. HR explains turnover in percentages and measures engagement in survey scores, while CEOs leap to improve revenue and expenses in dollars. So a CEO’s first response to our data is to ask for benchmarks, which usually provide false comfort. If you say, “Our turnover is 25 percent and the benchmark is 26 percent,” a CEO will nod politely. But if you say, “Our turnover is 25 percent and it’s costing us $4.3 million each year,” a CEO will likely demand improvement, as he or she should.

2. Establish engagement and retention goals at each leader level. Scores of studies reach the same conclusion: Employees stay or leave and engage or disengage based on how much they trust their supervisors. More studies say the single best way to improve these metrics is to hold first-line supervisors accountable for their direct reports. Yet most companies continue to say, “HR, go fix it,” and employees visit career fairs while grumbling about their current bosses. When was the last time you heard a good worker say, “My boss treats me like dirt … but I’m holding on for employee appreciation week?”

3. Implement stay interviews. Engagement and exit surveys provide data but give no real clues to solutions, mostly because we build programs based on survey results that work around supervisors rather than go through them. Managers who implement stay interviews build trust and also are able to address the most important issues for each individual employee. They don’t presume that the average scores presented in employee surveys give hints to each employee’s unique needs. I surveyed 7,500 HR executives about exit surveys, and the number who said exit surveys have improved their company was 15. That’s way less than 1 percent.

4. Forecast engagement and retention. Managers who put a stake in the ground and say, “This employee will leave within six months if we can’t address this issue” are taking a leadership role in retention. The trinity of engagement and retention then becomes engagement and retention goals, stay interviews, and forecasting, all of which drive first-line managers to say to their bosses, “You asked me to cut turnover and I’ve learned something in my stay interview with my top performer that’s important. Can you help me make some changes?”

5. Hold managers accountable for engagement and retention goals: Peter Drucker taught us that nothing happens in an organization without individual manager accountability. CEOs know how to drive sales and service with accountability as their main tool. Now that we have established that engagement and retention happen very locally—between each leader and the leader’s individual team members—holding those leaders accountable for retaining their team members and improving their productivity is a natural but long overdue step.

To learn more about improving retention and engagement, you can attend Richard Finnegan’s session at the Recruiting Trends Conference, which will be held in Orlando, Fla., on Nov. 8-10 at Disney’s Grand Floridian Resort. For more information and to register, go to: http://www.recruitingtrends.com/conference.