William J. Rothwell on Sustainable Talent Development and Employee Retention

The following is a guest post by William J. Rothwell, Ph.D., author of The Manager’s Guide to Maximizing Employee Potential.

Sustainable development is the latest popular fad.  Typically it refers to the ability of an individual, organization or nation to achieve results while minimizing (or even eliminating) negative impacts on the environment. In normal usage it is associated with “going green.”

Reducing the individual’s, organization’s, or nation’s carbon footprint is one example of sustainable development. The usual idea is to ensure the earth’s continuity in order to serve citizens, do business, and work. The opposite of sustainable development is unrestrained capitalism, the folly of which was recently illustrated in the financial crisis when CEOs were rewarded with millions in “performance bonuses” while bankrupting their companies, casting millions out of work, and costing millions their retirement savings.

The term sustainable development also has additional meanings—and additional implications—than merely “going green.” When an organization’s leadership has established a climate in which people want to work, want to achieve results, feel engaged, and can exercise their talent and innovation, then the leadership has established a climate for sustainable talent development. When this climate exists, talented people will not only stay but will also attract others who are also talented and innovative. Investments in human development pay off  when the best people want to stay—and those who are not the productive are encouraged to go elsewhere.

W. Edwards Deming once noted that “management creates most of its own problems.”

And that same principle is also true for creating sustainable talent development. If an organization is willing to invest money in developing people, and those best people are both top performers and are promotable, then it is likely to retain them.

Few organizations  focus enough attention on retention. It is the weak link in most talent management programs. Many organizations use exit interview programs to pinpoint why people leave. The theory is that, if the reasons for voluntary turnover at can be identified, then the organization can solve the problems.

But exit interviews are particularly prone to a term called social desirability bias–the tendency to tell researchers what the research subjects think the researchers want them to say. For that reason, many people say “I am leaving for a better paying job” or “I am leaving to follow my husband, wife or significant other to another place.”

But, in most cases, those reasons are not the root causes of turnover. These reasons sound good, but they are not necessarily true. In most cases, people leave their jobs because they feel that they were not treated well. When they feel ill-treated by their immediate supervisor or their co-workers, then they start looking for alternative opportunities. Research supports the statement that “people quit their bosses, not their jobs.” They do not leave until they find something better.

Why would people lie about their reasons for leaving? It is simple: they want to avoid burning bridges. They want to leave the door open to return if the future job does not work out. And if they say something like “my boss is a jerk,” they feel they may be burning bridges. So, they tend to say what sounds good but is not necessarily true.

And yet the implications of what people say in exit interviews are profound. Managers will point a finger at HR and say “our organization is not paying people enough. It is your fault that we are not keeping our pay plan competitive.” And thus managers escape their own accountability in turnover and (possibly) prompt a wild goose chase over pay.

What is the alternative? First, exit interviews should be managed differently. Instead of asking employees why they leave on the last day or the last week of employment, they should be asked about 3 weeks after their last day. Of course, that may require giving them an incentive to respond—such as a gift certificate for a meal at a nice restaurant. Research indicates that people are more truthful about 3 weeks after they leave.

At the same time, managers should be asked about the quality of the people who left. Some turnover is good—if the bad performers are encouraged to leave. So managers should be asked to rate the performance and promotability of those who leave. At the same time, they should also be asked if they have heard any reasons why the employee leaves.

Both HR and managers should ask the best people why they stay. They can do that through interviews or focus groups. In that way, they can pinpoint what motivates and energizes people and try to give them more of that. By doing so they are enhancing employee retention of the best people. They are also zeroing in on the employment brand, the key reason that people are attracted to the organization as an employer.

The organization should carry out regular, periodic climate surveys to identify dissatisfiers so that they may reduce or eliminated. That can also be useful in forecasting turnover rates if the right questions are asked—such as asking people how satisfied they are with their jobs and how likely they are to leave within the next year. Individuals with high levels of dissatisfaction and with a high intention to leave are most likely to do so, making it possible to predict turnover with a high degree of accuracy.

Finally, organizations should encourage managers to be better at “people management.” That can be accomplished by providing skill-based training on how to give coaching and feedback.

In conclusion, sustainable development means more than “going green.” It means reducing turnover—particularly the turnover of talented people. Many organizations could stand to improve how they manage retention. And, as economic conditions improve, many organizational leaders around the world are likely to be concerned about retaining talented people. That means they should devote time and effort to the sustainable development of the best people.

William J. Rothwell, Ph.D., SPHR is President of Rothwell & Associates, Inc. and Professor of Workforce Education and Development on the University Park campus of Penn State University. As a consultant he has worked with 35 multinational corporations. As an HR practitioner before his academic career began in 1993, he worked in business and government for 20 years. As a professor, he heads up a top-ranked graduate program in training/human resources. He has written The Manager’s Guide to Maximizing Human Potential, Effective Succession Planning, and co-authored Working Longer.  He can be reached at wjr9@psu.edu.

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One response to “William J. Rothwell on Sustainable Talent Development and Employee Retention

  1. It is so true “management creates its own problems”. Worst when HR Management is part of the problem, bias and unfair treatment to the majority when opportunities are only given to those in favor by management due to family background, friends, relatives and bribery. Leavers will never tell the truth to HR unless an independent party is engaged to do the survey (this is a potential biz opportunity). HR in most companies are not trustworthy as their role now changed to business partner.

    I believe the problem my Organisation faces is not know how to identify and manage out toxic management personnel as it already penetrates into the culture – everyone is burning with desire to have more power, money and territory… at the expense of majority, the workers… Sustainability in this Organisation is questionable.

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