High Performers Are 400% More Productive Than Average Employees. Keeping Them Takes More Than Money. The competition for top talent shows no signs of easing, which means the companies that nurture and retain their best performers will come out ahead.
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Retaining top talent should be a priority in any economy, particularly in this downturn. One recent study found that high performers were 400% more productive than average employees. And the competition for top talent has never been more fierce: Nearly 90% of executives and managers in a recent McKinsey Global Survey said their organization already faces a skills gap or expects one to develop by 2024.
That's why progressive employers are increasingly focusing on retention strategies, even in a downturn — identifying who their true "water carriers" are and taking proactive steps to keep them engaged for the long haul. Not surprisingly, a common denominator to smart retention strategies is data. With the wealth of people data now available — from engagement levels to performance and even influence and network — it's possible to identify and incentivize high-value team members with a striking level of precision.
For employers seeking to retain their best and brightest, these three critical levers can make all the difference.
Related: How to Make More Money, Retain the Best Employees and Grow Your Business — All at the Same Time
Don't underestimate the power of purpose
A central way to retain high-performing employees is to use your company's mission and values to guide operations and strategic decisions. Now, more than ever, this can be a differentiator.
Half the workers surveyed in a recent Gartner survey said the pandemic changed their expectations of their employer. Fifty-six percent said they wanted to contribute more to society, and nearly two-thirds were rethinking the place that work should have in their lives.
A workforce aligned with a clear company mission — one that is lived, not just written on a dusty vision statement — is more loyal and engaged. Nor do "mission" and "values" need to mean saving the world. Operating from a place of honesty, authenticity, and trust can be just as powerful.
Our research shows a strong correlation between trust and retention. For example, nearly half of the employees who trust their employers say they see themselves staying in their current roles for five years or longer, compared to only 29% of those with little trust. Building trust in a downturn means being transparent about challenges. High-performers know when the truth is being sugar-coated. You are likelier to rally employees around a common cause and build a fighting spirit by being open and authentic.
Here, too, data can help. Internal survey tools can show shifts in employee sentiment, while advanced analytics platforms can reveal subtle changes in things like email frequency and meeting attendance that show true buy-in.
Related: How to Attract and Retain Top Talent
Prioritize experience (not perks)
Numbers don't lie. Companies with higher employee engagement have 65% lower than average turnover. They also have greater profitability, higher productivity, better customer ratings and lower absenteeism and theft.
So a second important way to keep valuable employees is to pay attention to employee experience on a deep and meaningful level. Cultivating good experiences isn't about gym memberships or free bagel Fridays; rather, it needs to be baked into every level of operations.
A classic example is professional development. In too many companies, this is misunderstood to mean an occasional conference or continuing education program. But true professional development is a continuous process that requires meaningful, day-to-day engagement with a committed manager.
A big part of that is providing team members with opportunities for lateral growth. These lattice-style promotions strengthen the organization, seeding interdepartmental best practices and providing employees with new growth opportunities. In fact, our research shows that a desire to learn skills is a significant driver of employee turnover, with 32% of respondents in a recent survey saying learning opportunities influenced their decision to leave.
Leveraging people data can yield dividends here, as well. With the right platforms, companies can map skills, competencies and capabilities across entire organizations, identifying growth opportunities for promising employees that extend far beyond the traditional "ladder" to the top. A recruiter who spends time in a sales role will be more well-rounded and ultimately more successful in either capacity. The company will benefit from its multifaceted perspective.
Related: What Attracts and Retains Employees? It Might Not Be a Paycheck.
Salary size matters, but so does transparency
Compensation is usually the first tool that comes up in discussions of workforce retention. In fact, it's often the entire conversation. But for employees, compensation may well be the weakest form of persuasion, especially if you're offering competitive wages to start.
Certainly, unusually low salaries can make employees feel undervalued. But money only goes so far as an incentive. Consider that one-third of job switchers during the Great Resignation took pay cuts to gain a better work-life balance.
Our research has shown that transparency in pay and promotion is equally important to employees. Once considered a taboo topic, pay transparency is now the law in at least seven U.S. states, with more to follow. People data can be invaluable when identifying a role's "right" salary. Wise leaders use data to benchmark salaries against industry standards to ensure competitive salary bands. In short, there's no reason the appropriate salary should be a guessing game for companies today.
Of course, leaders can't prevent good people from leaving if their hearts are set in another direction. Let them leave on good terms, with your respect and encouragement. Employers have a vested interest in giving employees gracious exits. Our research shows that boomerang employees made up nearly one-third of external hires from January 2019 through April 2022.
But by using people data and paying attention to the three pillars of employee engagement — mission, experience and compensation — leaders can minimize employee turnover by creating a productive, fulfilling work environment. It's a worthwhile investment to help keep and develop high-value people in bad and good times.