How retaining talent can reduce risk

Recruiting and retaining a workforce is always fraught with risk. Losing valued members of a workforce is disruptive, damaging and expensive. At its worst, it can threaten the future of an organisation.

One of the most challenging risk issues created by an outflow of employees is that, as people leave, they take knowledge and experience with them. They are not always easily replaced, especially if they work in specialist areas or have important personal contacts.

The impact of high employee turnover

I see a wider problem too - a change of personnel can mean a shift in corporate culture. The people left behind will be saddled with all the work until those who have gone are replaced, and it’s hard to recruit at the moment. That means they are going to feel pressured and stressed because they are taking on an extra burden. They could then end up leaving as well.

The damage this scenario can cause may strike at the heart of the organisation as it can impact on strategic objectives, which are predicated on having a certain number and type of people as well as specialist skills. 

If you don’t have both of these, or you can’t afford to buy them in, then you risk not being able to achieve your objectives.

The old mantra that it is much cheaper to retain someone than having to recruit someone new still holds true. It’s incredibly expensive, and getting more so, to bring people in. It’s not just about salaries - the process of recruiting costs a lot of money.

On top of these risks, there is also the reputational aspect. If you start to haemorrhage people this does not make you attractive to those individuals you are trying to recruit and use to backfill.

What can be done to mitigate the risks?

Thinking broadly across the organisation about career pathways is one way of tackling the issue. If you’re a professional services firm, for example, don’t just focus on your fee earners. Look at your support and back office staff too. The same applies to every industry and sector. If you do that, employees are more likely to stay.

I would also emphasise that staff are looking for more than just financial remuneration. They also value lifestyle and other benefits, viewing the workplace from different aspects and demanding that it is an attractive place to be. Employers need to look at supporting employees beyond pay increases, in order to survive and thrive. (Watch the video from our ‘Employer DNA’ series for a more detailed discussion of how to support employees.)

This could mean improving your systems and processes. One of the things we hear is that people get very frustrated with old infrastructure such as IT legacy systems cobbled together. They find it really frustrating and if they see that someone else is doing it better, they will jump ship. If you can make it easier for them to do their jobs, then they are less likely to be disgruntled.

A good risk process needs to be both top-down and bottom-up. Clearly not everything can be improved, but risk managers need to listen to the people on the ground and the ideas they have for making things better.

You have to make people feel heard and give them some investment in the future of the organisation. Then they then will feel that they are making a difference. It’s the intangible things that can make people want to stay and give you their loyalty.

Remote and hybrid working – time to review?

With remote and hybrid working now being so popular that taking it away is a major risk issue, keeping it in place, if at all possible, is a no-brainer for many organisations. However, there is often a pressing case for refining and, where possible, improving an organisation’s remote working policy.

There needs to be a recognition that most businesses implemented this as an emergency response to the Covid-19 pandemic and, as it has now become embedded, there may well be a strong case for re-examining how it works within an organisation.

During the pandemic people muddled through, but things need to be put on a firmer footing now. Employers need to take a step back and ask if they have it right.

What about health and safety at home? Do you have the right business continuity plans in place? Are there going to be power cuts during the winter and what will the implications of those be? Do you know who the key people are and what your critical processes are? What happens if key people are working from home and the electricity or broadband goes down? How long can you afford these things to be out for? And do employees have an alternative power supply or generator?

Managing people remotely is a skill in itself and training may be needed, especially in holding the team together and managing work equitably. The question of mental health and welfare checks also needs to be considered.

Learn more about hybrid working risks through this in-depth article on our Risk Portal, where we analyse the risks around performance and productivity, compliance, talent and health and safety. 

Rethinking recruitment and retention

People will leave if they’ve not been trained properly, or if they’re working with someone who can’t manage because they don’t have the skills to do so in this new world.

Information security too is always a huge issue. You really need to step back and start thinking about these things. Getting it right is hugely important. People can become disgruntled very easily.

As well as challenge, though, there is also opportunity. If people are leaving and you need to recruit or replace, then it gives you the chance to think about what you really need and to become more diverse and inclusive.

Julia Turney is a Partner, also at Barnett Waddingham, specialising in technology, benefits and people. She agrees that retention is a significant issue for employers at present. Issues she has identified include the potential for a corporate brain drain and productivity slippage as well as cost impacts. She also believes that, if you don’t have the right people in place, that can impact on supply.

One possibility for recruiting is to reach out to those who may have retired but are keen to come back into the workplace, or individuals who have moved to part-time but may want to increase their hours again. There are also those who have had caring or family responsibilities but want to return. You may want to look beyond early or midlife career people.

Another route is to consider apprenticeships, which have fallen somewhat out of favour in recent years. Some employers may think they are not applicable to them, but they could well be. Julia also agrees on the importance of being able to offer flexible working if possible. "People are currently looking for both a better work-life balance and meaningful work. They may leave if they feel that they’ve not been stretched in their job, or if they haven’t been trained or feel they’ve stagnated."

Julia also believes that open communication is necessary and that people are looking for support from their employers in areas that perhaps they didn’t before. Most employees want to thrive in the workplace and do meaningful work that they enjoy or that has an impact. You have to create a culture that they want to be in.

It is also important to remember that a lot of organisations could have four or five generations employed at once. You just can’t meet everyone’s needs all of the time. People’s attitudes in terms of what they want out of their jobs has shifted since the pandemic and they may be a bit quicker to move on now than they have been in the past.

The message that recruitment and retention is a real risk is now being acknowledged. Julia believes that this amounts to a long risk and that “it’s a catastrophic event happening over months and years rather than as a one-off. But I think that things are starting to change, and it is seen for what it is now.”

If you would like to discuss any of this topic in more detail, please contact your usual Barnett Waddingham consultant. You can also get in touch with the author, Karla Gahan, below. 

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