We live in tumultuous, uncertain times, and the destiny of every organization depends on how well it can leverage its human capital in general, and its top talent, in particular.
As I have mentioned a few times before in CSQ, the importance of talent management in times of crisis and change is difficult to overestimate. Talented employees always remain in demand—in a good economy, they are your most valuable assets that provide extraordinary value, while in difficult economic conditions, they are the ones who can keep your company afloat and competition at bay. In times of change, talent is the only true strength organizations can rely on.
As the “Great Resignation” has shown, people no longer want meaningless and thankless jobs; they would rather stay away from the regular workforce than go back to a “hamster wheel” of nine-to-five office work. However, the peak of mass voluntary turnover seems now to be behind us, and most companies can finally refocus their talent management endeavors from talent acquisition to talent retention.
Organizations should not yet breathe a sigh of relief, though, since instead of the “Great Resignation,” it appears that we are now dealing with the “Great Recalibration,” when people begin rethinking the role of work in their lives. Retention is not only about good compensation, developmental opportunities, and great working atmosphere anymore, but is also about flexibility, trust, purpose, balance, asynchrony, and emotional well-being. Smart organizations are, therefore, already starting to adjust retention strategies around these important factors.
Some experts recommend that organizations work on creating “sticky” workplaces, those that people do not want to leave. It goes without saying that adequate compensation, benefits, and career growth opportunities should just be the first step— necessary but definitely not sufficient. To take the next step and begin creating a sticky workplace, it is necessary for managers to listen to their employees, addressing their concerns, anticipating their needs, promoting health and wellness, supporting open, transparent, and multidirectional communication, and establishing and maintaining trust, among other strategies. To build your own sticky workplace, it is essential to understand the basic assumptions that underpin this model.
Work stickiness is based on the notion of job embeddedness, which is a relatively novel concept in the world of people management, especially when it comes to talent retention. The traditional view on the issue of retention includes the factors from voluntary turnover research (job satisfaction and the absence of job alternatives) and other positive behavioral aspects of an employee’s attitude toward their job (organizational commitment, perceived management support, etc.). The more recent research has shown, however, that there are more factors that make employees stay with a company. The first set of factors includes all sorts of off-the-job aspects of an employee’s life, such as family pressure, community commitment, and hobbies. The second set involves the emotional attachment an employee has to their co-workers, various company activities, perks, and job routines. Scholars used the term “embeddedness” to combine all of these factors that greatly influence retention.
Simply put, people stay not only because they are satisfied with their jobs and have no other job alternatives, but also because they are embedded into their jobs via various links to their families, co-workers, and communities.
Researchers argue that job embeddedness consists of three key factors: links, fit, and sacrifice.
- Links are defined as the connections people have with other people or groups of people. Links could be either on the job, such as professional associations, or off the job, such as a church community.
- Fit is an employee’s perceived match with their job, company, and local community. Just like with links, fit could be either on the job (compatibility with co-workers, corporate culture, etc.) or off the job (compatibility with family schedule, etc.).
- Sacrifice is an opportunity cost of what people have to relinquish if they decide to leave. Most sacrifices involve financial inducements—such as retention bonuses, stock options, and educational funds—that people forgo if they leave. However, the more important sacrifice people can make is to give up an opportunity for long-term professional development with the company, flexible working arrangements, mental health support, pleasant organizational environment, among others.
To sum up, job embeddedness reflects a whole variety of both on- and off-the-job factors that help keep people, and especially, top talent, in their current jobs.
So, how should practicing managers use this concept to revise, systematize, and rebuild their retention strategies? First, think about on-the-job links that you can offer your employees, be it a paid-for memberships in professional associations, clear career paths, or continuous professional development opportunities.
Next, turn your attention to fit and make sure that your valued employees are deployed in job roles that match their knowledge, skills, and abilities, and that they can take advantage of flexibility in where and when they work and enjoy a supportive work environment.
Finally, when considering sacrifices that your most valued employees will make if or when they decide to leave you, besides purely financial stimuli, pay special attention to non-financial ones, such as the sense of purpose and belonging, talent-centered organizational culture, and career growth opportunities.
Once again, (re)developing your retention strategy based on the notion of job embeddedness will assist you in being more systematic in your approach and help you succeed in turning your organization into a sticky workplace.
One word of caution, though: Do not be overzealous with job stickiness. Creating too much embeddedness (i.e., maximizing links, fit, and sacrifice) can make people feel trapped within the company, which will have the opposite effect on your retention efforts. Just like with everything in our lives, use your common sense and keep a meaningful balance between the three main components of job embeddedness.
Vlad Vaiman is Professor and an Associate Dean at the School of Management of California Lutheran University and a visiting professor at several premier universities around the world.