Risks Associated with Losing Top Performers
Most of you already know the importance of retaining top performers. Nearly any HR person can speak to this concept. But, a lot of times, what we are looking for are ways to explain this or have conversations internally with our business leaders.
I believe that a lot of organizations give lip service to people being their most important asset. But, we don’t see those ideas trickle down into some of the policies or practices of organizations.
As HR professionals, we need to make sure that the risks associated with losing top performers are not just based in theory. We can show that attracting and retaining top performers is truly is the differentiator between good and great companies.
Top Performers Are Always Looking
There was some research from a SHRM whitepaper that said, “Did you know that 40-50 percent of top performers are actively looking for a job? This percentage is significantly higher than middle or low performers.”
The whitepaper was specifically about the economic recovery. And, while the worst of the economic downfall has caused people to hunker down and stay where they are, many people are now looking for new jobs. And, this article showed that it is really your top performers who are doing most of the looking.
I hope that this information incites some fear in you. I know that many HR people know that without our top performers, the company would be in worse shape.
What Are the Risks Associated with Losing Top Performers?
Top performers contribute most to the bottom line. I had an opportunity recently to attend a seminar and the presenter did a fascinating talk about ROI on labor dollars. There were calculations on revenue per employee. And, what the research was looking at was, “Which are the companies that drive more revenue per employee than others?”
As you can imagine, many of the companies at the top of the list were companies that we admire and that have a really strong business model. For example, Google was one of those top companies. Their return for every dollar spent on labor costs was 13x. This number was significantly higher than similar organizations, like HP or Dell and others.
Labor ROI Matters
That achievement is a big deal. As we all know, labor dollars are a huge spend for any company so getting a good return on that investment is crucial. I think that, as an organization, we need to benchmark ourselves to those numbers; take a look at what our return is on our human capital investment.
What is even more interesting is that this presenter went into even more detail about top performers. The stats on top performers are off the charts. If you think about those folks that have those innovations in their head or they really contribute to the competitive advantage of your organization, those folks are contributing even more to your bottom line.
Get a Great Reputation with Top Performers
This isn’t lip service to supporting top performers. This is real, hard data about companies that are successful and companies that are not. And, top performers are a pretty key part of that. The beautiful thing is, once you establish a reputation of being a high performance culture, you attract more top performers to you.
Google does a lot with their recruiting but, at the same time, a lot of people want to work there simply because of their reputation. It ends up having a very positive effect that builds on itself. The element of reputation is one of the biggest reasons to work on retaining top performers and get them boosting your bottom line.
Stacey Carroll, CCP, SPHR
Do you have any salary range topics you would like to see covered here on Compensation Today? Write us a email@example.com.
Are you doing a salary review or compensation benchmarking project? PayScale provides up-to-date, external salary market data you can use right now. And, it is specific to the education, skills set and experience your employees. Give a PayScale demo a try.