The process of addressing turnover hasn’t been easy for our leadership team. We’ve had some painful conversations with employees as we asked them what they thought we were doing right — and wrong — as we dealt with it.

One thing we heard was that some didn’t think we were fighting hard enough to keep valuable employees by making counteroffers if another employer tried to poach them. Counteroffers weren’t something we would normally bring up with the team, given that we keep everyone’s compensation private, but in response to the feedback, we have started mentioning if we make a counteroffer.

We also heard that some employees wished we would give across-the-board pay increases every year instead of merit raises. We weren’t prepared to do that, because we believe compensation should be tied to performance and also have to make sure we can keep pace with rising health insurance costs, so we created a profit-sharing plan where the top 15 performers share in our profits. That answer didn’t make everyone happy, but we have found in exit interviews that by showing employees we heard their concerns and are being open about our thinking, it has made the company stronger.

These efforts have been helping us continue to scale up, despite the challenges of today’s labor market. We’ve grown to 50 employees, and our company has hit $7 million in revenue, up from about 40 employees and $4.5 million in revenue in 2016, the year we introduced the ESOP.

We’ll never solve the turnover issue completely. Given the tech talent shortage, turnover is a challenge for even the biggest companies. The median tenure on Google’s team is 1.1 years, according to PayScale. At our company it’s 2.2 years. We’re glad that number has held steady since we added the ESOP in 2016, even as the full employment market has made it easier for people to find another job and leave.

At the same time, we have found that some of the employees who left us have reapplied to come back to work for us. About 25 to 30 have left since 2016, but eight former employees have reapplied and returned. After trying other employers, they’ve realized how much a small company like ours can offer, even if we can’t afford to be the highest-paid employer.

— By Delcie D. Bean IV, CEO of Paragus, an outsourced IT services firm based in Hadley, Massachusetts, and a member of the
CNBC-YPO Chief Executive Network

Follow him on Twitter at
@DelcieBean

About YPO

CNBC and YPO have formed an exclusive editorial partnership consisting of regional “Chief Executive Networks” in the Americas, EMEA and Asia-Pacific. These Chief Executive Networks are made up of a sample of YPO’s global network of 26,000 top executives from 130 countries who are on the front lines of the economy and run companies that collectively generate $9 trillion in annual revenue.





Source link

LEAVE A REPLY

Please enter your comment!
Please enter your name here