Addressing Attrition Issues
through Talent Development
by Carol Dominguez and Paul Catiang

“Learning is a lifelong process of keeping abreast of change and the most pressing task is to teach people how to learn." - Peter Drucker

On July 11, 2007, the Contact Center Association of the Philippines held its third Call Center and Conference Expo at the Crowne Plaza Galleria. Carol Dominguez, President and CEO of John Clements, gave a presentation on one of the more burning issues the BPO industry has faced since the continuing boom in its growth: attrition. Carol focused on one of the more crucial career stress points where attrition is highest: among first-time managers.

Using training as an employee retention strategy is nothing new; in many cases, training programs have become automated processes in some companies that employees undergo as if on an assembly line. Carol, however, focused on talent development on the higher levels, starting with first-time managers in particular, but experienced leaders also have a few more things to learn.

Referring to Linda Hill, a writer published by Harvard Business School Publishing and the Harvard Business Review, Carol said that first-time managers undergo a natural career stress point and proposed solutions designed specifically to prepare would-be managers for the change (Becoming a Manager How New Managers Master the Challenges of Leadership, Hill).

A Case Study in Attrition
Carol began her presentation with a case study from Harvard Business School Publishing, which dealt with the case of a company that has recently decided to take advantage of the cost-saving opportunities resulting from attrition. Using voice files and with the participation of Alicia Arroyo, Agnes Celdran and Mary Solina, the story unfolded: Arthur, an executive with the company, promoted Warren, one of the star performers, after the resignation of a senior employee. Warren, whose impressive track record has earned him his promotion, then faced the challenge of managing a team instead of the usual tasks an individual performs. The story detailed how Arthur neglected to see the signs of burnout and defection in Warren: the long hours spent managing the team, the missed meetings, the botched sales presentations, among a few others. The case ended with Warren not only defecting to the company’s competition, but also taking one of the other top performers with him, leaving the company to deal with the repercussions of his resignation, not the least of which is the cost of hiring and training a new replacement.

Warren is a first-time manager in this case study, and he has had to cope with the stresses of making the change from being a top performer to being a first-time manager. This is not an uncommon occurrence among this substratum of professionals. Citing “Don’t Blow Your New Job,” (Anne Fisher, Fortune Magazine) Carol said that 35 percent of new managers fail. She also added that 50 to 80 percent of new managers fail to live up to the expectations of those who promote them (Bristlecone Learning, LLC).

First-time managers, however, are not the only people in need of further training. Professionals who have been leaders for an extended period of time also need talent development, to review attrition and retention strategies and to view them in the context of the present day. While the principles of leadership remain unchanged, its particular details require some examination. These details include the values of the current generation of professionals and how best to lead them, as well as the changes management practices have undergone in the past few years. Carol’s presentation, which refers to several management and leadership books and articles published by Harvard Business School Publishing, gives a small peek into these new developments.

Attrition Revisited
The causes of attrition are varied and bear some repeating. Conditions change. The quality of top management’s decisions declines. New leaders whom employees don’t yet trust or feel comfortable with take the helm. Employees’ relationships with their own supervisors become too stressful or problematic, and they don’t see any other options in their company. One or more colleagues whom an employee particularly likes and respects leave the firm, thus taking away the affiliation that means so much to that employee. A person’s job responsibilities change so that the work no longer appeals to his or her deepest interests or provides a sense of profound meaning or stimulation. Most unfortunately, some people leave for the wrong reasons, without really understanding why they’re unhappy or what opportunities to improve things may exist within the company.

Burnout is also a familiar culprit. Work exhaustion lowers job satisfaction, erodes commitment to the organization, increases the intention to defect, reduces self-esteem, causes people to doubt their competence and achievement, and fosters a detached or negative approach to colleagues, customers and clients. Employees get burned out as the result of several factors: work overload, conflicting demands, unclear objectives, boredom, interpersonal conflict, a lack of positive reinforcement, like real rewards, and acknowledgment of their contributions, and the absence of the sheer joy of successes.

Why is burnout such a retention threat? Carol answered this by saying that burnout causes a vicious cycle within a company, starting with the shrinking of the local talent pool. This results in stiff competition for good employees, all of whom are being courted in creative ways by several companies. As a result, many companies are left short-staffed. Employees who remain in these short-staffed organizations end up doing more than what their job descriptions entail. Overwhelmed with the increased work load, these people leave, forcing the employees remaining in the companies to take on yet more work.

Retention Strategies Revisited
To retain talent within a company, its leaders need to know the signals that an employee is thinking about leaving. Tailoring job content and job conditions also improve employee retention by playing to their strengths and capabilities, thus increasing their confidence and affirming the work that they do. This is also a good way to show support for employees’ career development. Bosses are urged to regularly "re-recruit" their top talent, and to use loyalty to colleagues and teams to retain valued employees. Understanding the high costs of replacing talented employees also serves as a reminder of how important retention is.

Employers would also do well to recognize the signs of employee dissatisfaction and that an employee is considering defection. These signs include a change in behavior, a decline in performance, absenteeism, sudden complaints about the employee’s performance, casual references to other companies and to employees who left, withdrawing from others, and talk of burnout.

Step One: Communication
Once these signs have been recognized, the problem can be addressed directly. Employers should meet employees privately as soon as possible so they can explain that they have noticed the change in the employees’ performance and behavior and ask what might be causing this change. This is also a chance for the employers to express how much they value the employees and ask if there is anything they can do to help.

Step Two: Tailoring Job Content
Communication is only the first step towards addressing the issue, of course. The succeeding steps may include tailoring job content in ways that engage the employees’ personal interests. If a change in assignment is more appropriate, they can also be gradually shifted from one activity to another, or new responsibilities could be added, preferably in ways outside of the employees’ core responsibility. The employers are encouraged to listen carefully to discover relevant skills and interests. It is also important to note that employees may perform well at tasks they don’t necessarily enjoy, and that they should avoid basing assignments primarily on an employee’s strongest competencies.

Step Three: Out-of-the-Box Thinking
In addition, Carol advised employers to avoid a one-size-fits-all approach to work conditions. Instead, job conditions should be tailored to meet employee needs. When possible, employers should be ready to offer part-time schedules, work-from-home options, tuition reimbursement for employees continuing their education, and career development or work-life balance options.

Some positions may need to be given a set duration, like job categories that have high turnover rates. This enables employers to anticipate who will be leaving and can prepare accordingly. Alternatively, employees assigned to these high-turnover jobs may be reabsorbed into other departments of the company.

Compensation packages should also be designed creatively. Above-market, across-the-board salaries are costly and don’t necessarily motivate all employees. Instead, employers should pay "hot skills" premiums to employees with crucial, rare skills. These "hot skills" premiums can, in turn, be linked to key accomplishments in a project’s life cycle. To increase savings, signing bonuses should be paid in stages, not in a lump sum.

High Value, Low Cost
There are also other out-of-the-box drivers that do not involve money in any way and yet yield performance of the highest quality. Pride in one’s organization and a sense of belonging to the company are both excellent motivators, both of which give a sense of ownership in their work, and encourage them to invest more of their professional selves in the company. Getting employees to align themselves to company values takes a large investment in time and effort, but the investment pays off handsomely in the long run.

Leaders are encouraged to understand the non-financial drivers of job satisfaction and generate commitment. Many managers rationalize inaction in the face of employee defections, saying, "We don’t have the resources to raise salaries", or "There’s nothing I can do."

The following measures don’t cost anything, but increase employee commitment by capitalizing on people’s innate desire for connection with social groups and satisfying work.

Employers can start with identifying the top one-third of their talent pools. These individuals can subsequently be "re-recruited" regularly by using monetary and non-monetary gestures to signal appreciation of their talents and by scheduling regular professional development meetings to give and receive feedback.

Talented employees are more likely to feel committed if they know that their company highly values their skills. Mentoring programs can be established, pairing junior employees with senior people for monthly lunches and other gatherings. Ongoing coaching can also provide informal encouragement and facilitate knowledge transfer; these two forces that fuel employees’ long-term growth.

Employees increase their commitment when they feel supported in their personal and professional growth. To this end, employers should devise "stretch" projects periodically and structure jobs so they further their employees’ professional development.

Engagement in work increases when employees are consistently challenged. Work organized around projects provides such challenges, as well as a fair degree of autonomy.

Employees are also committed to what they own on a professional level. Team-based compensation fosters a sense of teamwork, belonging, and ownership. Social connection can also be cultivated through company outings and events. Employees are often more committed to colleagues or a group than to a company, and these group activities provide the right atmosphere to encourage this kind of commitment.

A Profile of the Current Generation of Professionals
Young professionals in the early 21st century have a different set of values from their superiors, whose values were mostly shaped by baby-boomer practices. Young workers prefer and indeed expect individual responsibility and the freedom to make decisions away from their employers. A majority of these young professionals are sociable and therefore prefer enjoyable colleagues and a sociable workplace, as well as team-based work and collaborative decision making. They also have a predilection to continue their development as individuals and as professionals, and thus look for opportunities to learn and grow. These professionals wish to contribute right away, instead of waiting a few years to see the results of their work. As more sociable professionals, they expect lots of feedback and frequent and constructive reviews; corollary to this, they find accessible managers and open communications more encouraging. Given the high energy of this generation, they prefer pay for performance, and yet this same energy gives them a lifestyle that requires flexible schedules and ample time away from work. Lastly, respect from older coworkers is necessary for them to be effective in their work.

Retaining young workers requires polling new hires as to their expectations of the company and of themselves. Employers are encouraged to focus on Day One, to secure the new hires’ buy-in right from the very start. If senior executives get involved in this process, integrating new hires into the company becomes easier, as the older professionals get to know their younger counterparts more and appeal to their sense of community and teamwork. Employee retention needs to be made a real process, with line managers responsible for retention. Lastly, employers should measure employee engagement, mobility and learning.

Exit interviews play a crucial role in retention; not only do they help companies learn the circumstances under which an employee leaves, but it also opens the door to welcoming these departing professionals back. Forming an alumni association among former employees is likewise another step towards maintaining connections with these former employees, letting them know that the door is still open for their return (Workforce Crisis, Dychtwald, Erickson, and Morison).

In the previous century, the general perception of professionals is that they pick one line of work and stick to it for many years, with some people staying in the same job for decades. In the more dynamic 21st century, professionals have become more mobile, rapidly moving vertically and laterally among the ranks, or changing companies and even careers with dizzying regularity. For better or for worse, the changing nature of the 21st-century workplace is here, and one of the by-products of this rapid change is attrition. It is now the challenge of older executives to adapt their practices—not their principles—to the current context, to keep their employees committed and engaged. For younger professionals, their challenge is to prepare themselves to assume the mantle of leadership without backing down in the face of the stress of adjustment.

Carol Dominguez’s advice to both is further talent development with programs that draw upon time-honored principles and current developments in the business world.