It’s no secret that HR teams have faced increased pressures during the recent years of economic instability – and our latest HR survey really brought this issue to the fore. When asked about financial and recruitment challenges, 58% of the 290 HR Directors and professionals that responded said their organisations had found it more difficult to recruit the right talent compared to three years ago.
This finding compounds what is already a time-consuming and labour-intensive process, regardless of the sector. It demonstrates that finding ways to hire the right candidates, and providing new recruits with strategic insight and vision from the outset to ensure that they remain with the company for the long term, really is more important than ever before.
Why this challenge?
There are a number of reasons behind the increased difficulty expressed by 58% of respondents – but I would suggest that at the heart of it lies rising candidate expectations. Thanks to technological advancements and shifting generational views of the workplace, jobseekers in today’s marketplace expect more from potential employers and are increasingly knowledgeable about how to promote themselves.
Access to information online, coupled with the self-promotional opportunities offered by the online world and social media in particular, has provided candidates with a greater understanding of their personal worth, and has increased expectations accordingly.
Prospective candidates, now more aware of their own market value, can find comparative salaries online of others working within their particular region and/or sector. B2B social networks have also made direct contact easier for headhunters, widening the chances of an organisation’s top talent being lured away. This truly is a double-edged sword for businesses: while employees should be encouraged to promote their professional expertise on LinkedIn in order to act as brand ambassadors, doing so also places current employees who are doing it well “on the market.”
The inherent risks of talent theft, coupled with this abundance of knowledge, has made many HR departments reconsider their approach to retention. This is due to an understanding that salary is no longer always the key driver for many; added benefits – such as flexibility, organisational culture, work/life balance or gym memberships – now also have a large role to play in the decision-making process for candidates.
A renewed focus on retention
Regardless of your organisation’s success, there will always be someone who can pay your employee more – so effective engagement has to be viewed as a necessity. HR departments must look for new ways to engender employee loyalty in order to retain valued staff members.
Demonstrating a commitment to individual career development is core to today’s recruitment process. This is especially true in light of unemployment legislation changes, as employees who started a job after 6 April 2012 can be dismissed by the employer in the first two years with no right to make a claim for unfair dismissal. Against a continuing backdrop of economic uncertainty, and with the associated risks of taking on a new role clear to many, candidates may be reluctant to join an organisation unless they are certain of business direction and their role in its success.
The feeling of being valued must continue once hired through a two-way appraisal process that should be worth the investment of time and resource: businesses that successfully engender loyalty and make their staff feel valued and integral to the business’ success will likely reap the benefits.
Retention will not always be possible, of course, so it is also vital for businesses to have effective talent management and succession planning systems in place to be able to both understand the current workforce and to identify the leaders of tomorrow. Clear and transparent performance processes and career plans enable employees to understand and feel confident about their future, and for organisations to identify the key positions and what to do in the event that a key member of staff does leave the business.
The strategic value of engagement
The working climate has changed, and it can be said that employees are now less loyal than previous generations, especially after having gone through recession. This works both ways, and organisations, at large, are also less loyal than in previous decades. HR must look to engender employee loyalty in order to compete, retain key personnel and limit recruitment expenditure.
Most businesses would, of course, like to have low staff turnover, but there is an added advantage to high retention figures. With 29% of respondents in our survey also revealing that HR was given less prominence in the boardroom during the recession, engaging staff will also enable HR to demonstrate maximum return on investment at a strategic level. While it may be a cliché to say that people are the heart of a business, it’s a true sentiment – yet despite this, HR is still not widely recognised at board level, rather reporting indirectly instead. Demonstrating ROI is a way for HR departments to demonstrate their contribution in a language that resonates in the boardroom.
For companies to capture and retain the best talent to drive business advantage and remain competitive, effective talent management is crucial in order to meet ever-evolving candidate and employee expectations. Staff turnover is a major business analysis metric for benchmarking HR’s success, and engagement is the key to managing this figure.
Julie Windsor, Managing Director at Talentia Software UK