How Middle Market Companies Can Improve Retention

According to the National Center for the Middle Market’s recent Middle Market Indicator, 76% of companies believe that their “ability to attract, train, and retain talent is highly or somewhat challenging.” Talent recognition and retention is a growing problem for middle market companies, especially as the economy continues to improve.

With the war for talent raging on your HR department’s doorstep, how can you secure new talent? Moreover, how can you nurture employees so that they stay with your company and you avoid high replacement costs?

Considering the big picture of human resources in today’s corporate environment, the prevailing problem in companies is a failure to align the people strategy with the business strategy. Although senior leaders say that they recognize the importance of talent, by and large they are not practicing what they preach. A new report from the Human Capital Institute shows that only 17% of surveyed companies say that their workforce strategy is consistently in line with their business strategy. A big part of this problem stems from managers’ widespread inability to develop their direct reports. A meager 5% of organizations reported confidence in their managers to grow employees in their current roles — and few middle market companies consider using outside resources and consultants to assist them with these challenges.

To reverse these trends, companies have to get creative, and start innovating in their HR practices. Some of today’s fastest growing middle market companies already have excellent ideas when it comes to HR innovation.

1. Set aside time for independent work and innovation projects

Endless meetings can be a time and a brain drain for innovators. CEO of the Arrow Group of Companies says, “Some of our best innovations have come from people thinking on their independent time.” 3M has been doing this for years — Post-it Notes are one of the innovations that came from that commitment. Setting aside this time gives people an opportunity to think for themselves, make decisions, and take action, without the need for multiple meetings.

2. Hire for talent, not job descriptions

The CEO of Yellow House Events, a middle market company, suggests: “If there’s someone who has a particular gift, create the title for them that suits those particular skill sets.” This approach will open up your search for talent, and enable your recruiters to swoop up talent before they’re even looking for a job. Once they’re hired, it will also show talent that you recognize their strengths and encourage them to utilize them broadly.

3. Offer training and development solutions

If your talent is struggling to manage their teams or projects, consider offering them additional training rather than replacing them. Showing this kind of investment in your talent will gain their loyalty, and enable to better manage the resources you’re entrusting to them.

Middle market companies can also adopt Google’s cutting-edge HR strategy and start thinking of HR as “people operations.” Google retains some of the best talent on the market because they quantitatively prove the value of their performance — showing with data-driven analytics that a top performer is worth 300x more than an average one. Viewing people as assets with a solid value attached to them — in the same way that businesses calculate their profits — may seem cold, but it actually proves how much you value their work.