... and why is it still important in today's economy?
In recent years, managing talent retention has become a critically important topic that has captured the attention of the business, financial, and executive communities. It is a strategic issue that now commands the focus, time and resources it deserves. In many organizations, executives are creating integrated talent retention policies using internal and external data to shape focused retention solutions.
Retaining key talent, those employees in jobs that are critical to the company, is essential to an organization’s success as employees in these roles can make a significant difference in organizational performance.
This focus can be especially important during an economic downturn as companies struggle to maintain their levels of performance. Most experts and executives who offer strategies to deal with a downturn in business, provide three rules not to forget:
- Avoid the lay-off of key talent at all costs
- Keep recruiting, ensuring talent channels are open
- Maintain talent development programs
In any economic climate there can be very significant, negative consequences resulting from talent departure. Below are just a few ways in which organizations are impacted:
- High financial cost
- Productivity losses and workflow interruptions
- Service quality
- Loss of expertise
- Job satisfaction of remaining employees
- Image of the organization
The good news is that specific strategies aimed at overcoming the causes of turnover and implementing solutions to reduce turnover have important payoffs for organizations. Some studies have shown that the payoff for reducing turnover by 10 percent is greater than that of increasing productivity by 10 percent or reducing actual inventories by 10 percent. Other studies have indicated that just reducing turnover from industry average to the top 10 percent can increase profits by as much as 50 percent!
