Key Topics Covered in This Chapter
• Using alumni relations and informal contacts to keep departed employees in your company’s orbit
• The benefits of rehiring former employees
• Using exit interviews to uncover the root causes of employee turnover
O ne of the realities of market-wise retention is that you will never be able to keep all employees—par- ticularly the most talented, who have the greatest mobility.People retire.They are "poached"by rival companies.More than a few entrepreneurial types go into business for themselves. Others simply find opportunities elsewhere that your company can- not match.Some organizations actually create employee turnover as a matter of policy. For example, CPA and law firms have "up-or- out" traditions that result in 20 to 25 percent annual turnover in their professional ranks. Perhaps one in ten employees makes part- ner, but all the rest have to go. One major accounting firm, in fact, admits that at any given time half of its professionals have a year or less tenure with the company or are within one year of leaving. In the end, the struggle to retain good employees is a losing game. Either by death, retirement, or defection, everyone eventually leaves.The most you can hope for is to have some influence over who leaves and when. This chapter explains how you can minimize the damage caused by employee turnover—and even benefit from it—through atten- tion to alumni relations and the rehiring of former employees.We also explore how exit interviews can be a source for insights into improving the attractiveness of your workplace. Keeping Valued People in Your Orbit If you’re like most managers,you hate losing a real contributor.First, there are those nagging personal questions: "Is there something wrong with me?" "Could I have done something to prevent this person’s defection?"Then come thoughts about the consequences: "This won’t improve my performance evaluation a bit.""Why did she have to leave right in the middle of our key project? This will really throw a wrench into the works." "How will we cover her work until we can bring someone else on board?" Finally, you think about what you must do to fill the empty slot—and what that will cost in time and money.Talking with HR about the job description. Posting the vacancy. Scanning dozens of résumés—almost all wide of the mark.Arranging for interviews,and approving thousands of dollars for travel expenses.Then getting the new person up to speed.And all the while you know you’ll be lucky to get someone as good as the person who left. Losing a good contributor is a big headache and produces noth- ing but negative thoughts and extra work. But don’t let those nega- tive thoughts color your parting with the employee. In some cases you should not even use the word parting. Consider the hypothetical case of Stephen, a management con- sultant with Global Strategy Advisors, a full-service firm. As often happens with consultants and CPAs, Stephen was lured away from his job by a client company that he had advised on marketing strat- egy for the past four years.That company was seeking a top-drawer professional for its vacant Vice President of Marketing post.Stephen was a logical candidate for the job and was asked by the CEO to apply. Stephen knew the company, its competitors, its industry, and industry best practices.And the company knew Stephen. Its execu- tives and marketing staff had observed his performance over several years, and they liked what they saw. Compared with Stephen, other applicants for the VP position were simply question marks with good résumés. No one could say with any confidence how these other applicants would perform or fit in, whereas everyone agreed that Stephen was sharp and fit in nicely. Stephen’s move to the client company appeared to be a loss to his consulting firm—but was it,really? Now that he was the market- ing VP of a company that made regular use of consultants, Stephen was a potential customer with a sizable budget and the authority to hire outside marketing advice. If fortune favored his career, Stephen might rise to the CEO level, in which case he’d be hiring consult- ants in business strategy, mergers & acquisitions, marketing, IT, and other areas.And as a consulting veteran,he would be in a position to recommend different firms to both practitioners and M.B.A.gradu- ates of his alma mater who might be seeking consulting careers. So if Global Strategy Advisors handled its relationship with Stephen sensibly, his defection might not be a loss after all. And if corporate life didn’t suit him, Stephen might even return to his old firm in three or four years—and with the operating experience that many consultants lack. This hypothetical story is not far-fetched in the field of public accounting and consulting. Leading firms in those industries now have regular "alumni"programs that: • keep track of former employees; • maintain up-to-date,password-protected directories of former employees to which alumni have access; • post job vacancies and recruiting information; • provide free access to the firm’s latest research;and • host events that bring alumni together with current employees. The whole point of these programs is to keep former employees within the company’s orbit, even after their official ties are severed. That’s good for business.It also makes the company more appealing to career-minded potential recruits who understand that joining the company makes them part of a larger network of business profes- sionals. As Carl Stern, president and CEO of Boston Consulting Group, put it,"I want our people to feel that in joining BCG, they have joined a second family, and they remain part of that family for the rest of their lives." 1 What are you doing to maintain productive relationships with your valued former employees? Whether you have a formal alumni relations program or have used less formal links, keeping in touch with departed employees can lead to new business, market intelli- gence, and an occasional rehiring of good people who temporarily "got away."The effectiveness of either approach, however, will be determined by how you and your company handle departing employees.When a good employee gives notice,is he treated badly? Given the cold shoulder? Do bosses whine,"How could you leave after all we’ve done for you?" Those behaviors will sour the rela- tionship forever.Instead,you should: • congratulate the individual on his or her new career move; • ask the HR department to help wrap up all of the departee’s termination issues; • demonstrate appreciation for his or her contributions with a party or outing; • plan to communicate with the departee in a month or two to see how he or she is doing;and • keep him or her posted on employment opportunities within the company. Hiring Former Employees Thomas Wolfe’s message that you can’t go home again does not hold true for former employees.Just because a valued person has left your company, don’t assume that he or she is gone for good. Some women drop out while their children are infants but are ready to return a few years later. Others leave for what appear to be great career moves,only to be disappointed and disillusioned. Rehires can be a valuable asset for your company. First, they know your business and how to get things done there.This gives them a huge advantage over people hired from the outside, who generally need many months to learn the ropes and become effec- tive. Second, rehires return with broader experience and, in many cases, new skills. Finally, every returning defector sends a loud and clear message to others that the grass isn’t greener elsewhere. There are few statistics on the number of employee rehires, or "boomerangs" as they are sometimes called. For example, in 2000, the accounting firm of Ernst & Young claimed on its Web site that nearly 25 percent of its customer-serving new hires in North Amer- ica were former employees.During the following year—when most companies weren’t hiring anyone—Ernst & Young made a special effort to re-recruit good IT employees who had defected to now- defunct dot-com companies.It even set up a national Alumni Rela- tions Office to manage this important aspect of its human resource business. 2 Here are a few things you can do to increase the number of employee rehires: • Cure the problems that made them leave in the first place.Exit interviews and direct investigation are the best ways to deter- mine the root causes of defection.If you find that a bad regional manager has been driving his most capable sales peo- ple away,replace that manager—and then invite the best of the defectors to return. • Keep the lines of communication open between your firm and the best of its departed employees.Use some of the alumni relations tactics cited above.Communicate with them periodi- cally,ask about how they’re doing in their new jobs,and keep them up to date concerning job openings at your company. • Make re-employment as easy as possible.There’s a certain amount of discomfort involved with returning to one’s old company.Eliminate that discomfort through public statements that "Our door is always open to valued former employees." Celebrate each return,just as you would the return of a former customer."We’re glad you’re back!" Perhaps the biggest and most celebrated rehire in recent memory was Apple Computer’s rehiring of departed founder Steve Jobs.Jobs returned to his former post older, more experienced, and undoubt- edly wiser, and his return marked the beginning of an important revitalization for the then-beleaguered company. It’s unlikely that any one of your rehires will have the impact that Steve Jobs had on Apple,but you’ll know a great deal about the person you’re getting, and the hiring outcome is more likely to be more successful than if you hired an unknown off the street. Exit Interviews Most HR departments conduct exit interviews with departing employees, either directly or through questionnaires. The aim of these interviews is to get feedback about the firm,its operations,the root causes of turnover, and the performance of its managers from people who now have less reason to hedge or conceal their views. If your company isn’t doing this—or not doing it in a serious or systematic way—insist on a change.At a minimum,an exit interview should seek answers to these questions: • What originally attracted you to this company? • How satisfied were you with employment here (on a 1-5 scale)? • How would you assess your boss or supervisor (again,on a 1-5 scale on various dimensions:ability to communicate,leadership, fairness,employee development,etc.)? • Why are you leaving? (if the exit is voluntary) • Would you consider applying for another job here in the future? • How could we make this a better place to work? The responses gathered through many exit interviews can help you identify the root causes of turnover and build a solid strategy for improved retention. In this sense, information gleaned from exit interviews is an important part of continuous workplace improve- ment. Chances are your company seeks the root causes of below- standard output elsewhere in the organization—on the production floor, in customer service levels, and so forth—with a goal to improve process quality.What departing employees tell you should be used in the same way. Summing Up Acknowledging that employee turnover is inevitable, this chapter has offered three ways to potentially benefit from departing em- ployees: • Keep up contact and good relationships with company alumni; doing so can sometimes provide your company with new business,market intelligence,and,in some cases,rehires. • View highly valued former employees as potential rehires;in most cases,a former employee returns with broader experience and new skills—both of which can benefit your company. • Use exit interviews to obtain as much information as possible about the root causes of employee turnover. 142 Hiring and Keeping the Best People app e n dix a Sample Job Description A job description is a profile of a particular job, its essential func- tions, reporting relationships, hours, and required credentials. It identifies what the job-seeker agrees to do in return for pay and benefits. Rather than focusing on how an employee should spend his or her time,a good job description should focus on performance and the results the company expects in the bargain.What will success look like? How will it be measured? How should the employee’s work affect the mission and needs of the company? It is also an attempt to describe the qualifications needed to perform the job. The sample represented below contains the basic elements you should include in job descriptions you develop. Should you reveal the salary range in the job description? Many employers are reluctant to do this because of fear of offending exist- ing employees,preferring to veil uneven hiring practices.This is not only bad management,in the United States it is also potentially ille- gal if it indicates that you are not offering equal pay for equal work. For your convenience, you can use the "Job Profile" form to develop job descriptions for your open positions.