You’re Losing Top Talent and It’s Your Fault.
I am not a recruiter. I am not an HR expert. I don’t really even have that much management experience. I just see the people around me, especially the ad industry, losing top tier talent left and right with no real actionable plan to stop the root problems. First, we need to frame the problem.
“It’s 2017″- Some Canadian Guy.
Freelance opportunities are exploding. In fact there’s more freelancers in the US economy than there have ever been. Platforms like Fiverr and Upwork are only accelerating in popularity.
Companies like Stripe, Etsy, and Shopify are making concrete steps to make it easier to get started freelancing or starting boutique businesses than ever before. Not to be overlooked, but doing a startup is in vogue. Lots of people want to be an entrepreneur, or at least pursue what they envision entrepreneurship to be. The point is that your top tier workers don’t need you as much as you need them. If you give them a raw deal they can and will forge their own path.
Now this isn’t the cause of why you’re losing talent. This simply is the reality that the modern economy makes switching costs much lower than they were in the past. As I’ve seen it, there’s 3 core reasons this happens.
You’re Punishing Innovation.
I’m sure you’ve had lots of meetings about how you’re going agile, and you have a growth mindset. Totally.
The truth is most organizations aren’t ready to accept the other side of the coin when it comes to innovation. Failure.
They repeat mantras about the path to success is filled with failures etc. etc. But very few people are ready to actually accept the reality. Failure hurts, and more importantly it doesn’t fit into the modern spreadsheet driven projections that is the modern corporation. You aren’t setup to let people try, and by extension, fail and you’re losing the most innovative and highest performing people because of it.
You’re Optimizing for Pedigree Rather Than Performance.
Be honest with yourself. A resume comes across your desk that says Yale you give that person an interview. When you have people with an advanced degree on your team you give them deference in their decision making. You think you’re giving your best performer the ability to drive productivity and results, but are you? Going to an Ivy League is the ability to optimize for a legacy system when they were 17. That’s literally it.
It’s not just education. I see these biases all over with lots of things. You’re ignoring the people taking the chances and doing truly bleeding edge things, instead focusing on the person who takes safe options and moves the needle just slightly. Most people wholesale aren’t willing to deal with their biases so I expect this section to get hand-waved away. If you are willing to look though, think about how you’re treating employees that take the chances versus the ones truly trying to build and grow new things and initiatives in your company.
Your Business Model Doesn’t Reward Performance.
I’m going to make a bold statement. There would be a lot less startups today if large companies did revenue splits with the teams that built the products that make them so much money.
To quote Office Space “It’s a problem of motivation, all right? Now if I work my ass off and Initech ships a few extra units, I don’t see another dime; so where’s the motivation?”
Your top performers are leaving in droves because they can be making more money doing their own thing and they know it. Truthfully though these people shouldn’t have to be leaving. Big companies have the resources to make many the failed startup a success. The reason they’re leaving though is there’s no upside to being innovative. You’re already punishing them if they fail, and on top of it all, there’s currently 0 financial upside to fighting through the organizational issues to try and make it work anyways. So what happens? They leave and start a company, or freelance, or whatever. You lose top tier talent and then years later your company, or your competitor, ends up spending tens or hundreds of millions of dollars to acquire the company they built. Why? The reason is you wouldn’t give them 20% of their time to work on their idea and wouldn’t profit share with them.
I realize this comes off as a rant. I realize I’m likely missing tons of nuance as people read this shaking their heads going “Yeah but you don’t get it man”. Which is fair. Life isn’t fair though.
These issues are very real and are pushing out the best resource your company has and is making you less competitive at a time when the world continues to get smaller and smaller and your industry is getting more and more competitive.