Managing human capital in business requires an integrative approach between executive strategies, workforce strategies and human resource strategies. Coupled with the compliance and regulatory drive, the alignment of these well-implemented strategies, leads to improved capacity building. A business that differentiates itself by developing skills and workforce strategies aligned to business strategies and not compliance targets, is a business that has a competitive edge.
The Logistics Industry, especially the Freight Forwarding and Clearing Sector, has been spoilt with funded learning programs and financial grants from the Transport SETA. During the pandemic, this funding has dried up completely in the past two years and the importance of skills development has taken a different footing.
Companies have been so reliant on funding in the past, that they planned and budgeted accordingly. The industry is faced with a massive skills shortage but with no real effort to address the existing and future gaps. The misalignment between business strategies and skills strategies is massive. Budgets and strategies start with plans on increasing revenue and profitability, instead of how to create a pool of highly skilled and motivated employees who would drive the bottom line to new heights – not the other way around. The vicious circle of skills shortage and demotivated employees leads to high staff turnover. Staff Retention is the best investment an organisation can make for future growth.
The past two years have led many people to reconsider what is important to them personally and professionally. Despite the uncertainty of the future, the ‘great resignation’ has started as a nightmare for most industries and companies. Companies are paying exuberant salaries to replace lost talent.
Research conducted indicated a cost of 80% of a person’s salary is being spent on recruitment and onboarding. For a person earning R 50 000 per month, this means a cost of R 40 000 per month on replacing that lost talent on costs that could have rather been spent on retention plans. Lost talent and skills are very expensive to replace, and the question is now being asked – how do we retain talent?
1. Individual Professional Development
Instead of performance appraisals once per year, create a 12 – 24-month development plan with your employees. There is a direct link between low investment in employee development and staff retention. Encourage development through formal programs as well as informal information sharing. Make skills development a priority and an opportunity for career growth by providing relevant continuous learning and upskilling opportunities. A report from Deloitte’s stated that the top factors of employees who resign were because of a lack of career progress and challenges in their roles due to a lack of training and misaligned expectations.
2. Manage to retain
People want to work with constructive managers and good leaders. Over 30% of surveyed employees agree that constructive feedback and recognition from their managers, assist them to improve and perform better – and most importantly, feel valued. Managers with good leadership skills and high emotional intelligence will retain staff much easier than the ones who are not. A study done by Harvard indicates the ideal ratio between positive and corrective feedback should be 5:1. Five being positive and one being corrective. No one wants to feel devalued or unimportant – people want to be valued and respected and they will stay.
3. Onboard exceptionally
The shift from being an outsider to an insider is not only a welcome from HR on the morning you arrive at your new workplace. Create a proper, well-structured onboarding plan and experience. Have digestible guidelines to prevent information overload. This is the perfect opportunity to give the pathway to a winning culture and cultivate talent.
4. Build a winning culture
Cultivating a healthy culture attracts the best talent in any industry. Almost 50% of people will resign due to a poor and toxic work culture. Driven from the top, it is living the values and the purpose of the business. A winning culture puts people first, recognises them, grows them and incentivizes them for the right reasons. Creating a culture that speaks to the whole person is key. Whether it is flexible working hours, tangible and intangible benefits, financial stability, and meaningful job functions.
5. Employee Wellness is a necessity, not a luxury
Burnout and poor mental wellness amplify poor cultures, working conditions and putting people last. Burnout and mental illnesses are not easily cured and have staggering consequences on a person’s productivity, motivation, and health. With the new normal of remote work or working from anywhere, the potential of people leaving their current, non-flexible workplaces, are much higher. Flexibility is one of the highest, intangible benefits provided by some companies.
6. Return on talent investment
Measuring the value of talent development is not a short-term measure. Long-term value is measured through retaining talent, saving on recruitment and replacement fees, reaching transformation targets and building a strong talent pipeline, utilization of labour as part of the learning experience and creating high-performing individuals. High-performing individuals create a productive, efficient, and strong workforce with ethical leadership, taking any organisation from mediocre to magnificent.
The big six explained is not an overnight cure but a new culture. Metro Minds have not just won numerous Innovation Awards for achieving a workplace with good staff retention but are specialist in the filed of skills and talent development.
Contact juliette@dev.metrominds.co.za for a consultation.
