As concern about employee retention grows, experts at Henley Management College have found that money and job security are no longer the be all and end all when it comes to attracting and retaining staff.
Researchers looking at the ‘psychological contract’ between companies and their senior managers and executives have found that a sense of accomplishment plus fun and enjoyment at work are now more important than job security.
Using research into the views of 476 senior executives, the study found that financial incentives are not the most reliable way to employees’ hearts.
‘The traditional psychological contract, long-term employment for employee loyalty, is now widely undermined. Quantitative solutions, offering more money and golden hellos are not the solution, they are too easily matched and topped by competitors,’ said the study’s author Tim Osborn-Jones.
Progress at Nomura, for instance, is not about a step up the ladder, but about developing new skills and business opportunities. ‘We’re in an industry where a great deal of money is thrown at people … so money is not really the issue,’ said respondents at the Japanese bank. Nomura believes that giving staff ownership of projects is key to attracting and retaining its talent.
The study looks at the qualitative (non-financial) values and interests of today’s managers to discover whether these can become the basis of a new psychological contract. It also considers what companies are doing to attract and retain talented employees.
The research found that people’s commitment to an organisation is chiefly driven by emotional attachment and that employers must offer the right mix of values and attitudes as well as good terms and benefits.
For example, Royal Dutch/Shell believes that talented people will choose to join companies because of the values, belief and culture of that organisation.
To this end Shell has developed a set of business principles that places honesty, integrity and respect for people at the core of the company’s culture.
At the Pentland Group, which designs and produces internationally famous sports brands such as Speedo, Ellesse and Kickers, creative design is the key to success. The company focuses on attracting creative designers, managing teams for optimum performance and defining and rewarding talent.
Some 66% of respondents view their organisation positively in terms of ‘wanting to stay’ (affective commitment), but positive levels of ‘need to stay’ (continuance commitment) and ‘ought to stay’ (normative commitment) are substantially less at 33% and 38% respectively.
However, only 52% of those surveyed were described in the study as currently ‘positively committed’ to their organisations and 56% had changed jobs in the last two years. – Copies of the report can be obtained from Henley Management College. Email Julie Terney on email@example.com for details The college’s web site is at www.henleymc.ac.uk.
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