Are Your Best Employees Happy? Sure?

 The following article was written by James Dornbrook of the Kansas City Business Journal and features Dan Heiman of Cornerstone Kansas City

Reaching out to employed executives is now a big part of the recruiting business.

It’s the middle of the day, and one of your best and brightest employees is on the phone, by all appearances working diligently. But the person on the other end of the line isn’t a client — it’s a recruiter calling with a job opportunity.

This maddening scenario isn’t new; however, it is occurring more often these days as the economy improves and businesses strategically look to add employees, and as retiring baby boomers leave companies needing to replace experience instead of simply filling positions.

Throw in sagging job satisfaction rates as employees who put up with bad situations during the downturn begin to feel more confident about their options, and conditions are ripe for people like Dan Heiman.

Heiman is president of executive search firm Cornerstone Kansas City, a member of the global Cornerstone International Group.   He is busier than ever these days. His job is to find for clients the best talent possible — regardless of whether his prospects are employed. Mistakes employers make create plenty of opportunity for him to find talented people willing to listen to an offer.

“Either they aren’t paying them enough, they’re not investing in them enough, or they’re doing things that benefit the owner of the company and not the employees,” Heiman said. “Most of the time, what I see is people have a boss that they just don’t care for and is not pulling a team together very well.

“Now you’ve got a situation where people are being overworked and feeling unappreciated. It’s why businesses like mine continue to improve because there is this war for talent going on.”

Costs of the talent war

“There is a lot of research out there showing that the cost of turnover for entry-level employees is about 30 percent to 50 percent of their salary; at mid-level, about 150 percent of the salary; and at a senior level, up to 400 percent,” said Janet Smith, employee morale consultant for The Power of Goodwill in Lee’s Summit. “Even for an $8-an-hour employee, the statistics show that the cost of turnover for that employee is a little over $5,000.”

That includes hard costs, such as recruiting, pay, on-boarding and training. There also are soft costs, such as a loss of expertise, missed deadlines, production disruptions, increased stress on other employees and declining productivity. Then there’s an overall reduction in morale and possibly also in customer service.

Given that it is often poor management causing employees to listen to offers from recruiters, Smith said it’s amazing to her that only 10 percent of companies provide leadership training for newly promoted managers.

“The employees under them really suffer if those people don’t happen to be naturally good at being a supervisor, and those skills are not always intuitive,” she said.

Winning over talent can also be expensive. After identifying suitable targets, a prospective employer also has to make it worth a target’s while to make a move.

Heiman shared a story about recruiting a senior-level executive to the Kansas City area. The candidate, who was working for a much larger company on the East Coast, had the right skill set and seemed a great fit for the opening. Heiman called him out of the blue to discuss the opportunity.

Almost immediately, Heiman got a strong positive sign — the candidate shared that his wife disliked living on the East Coast.

“He was immediately willing to listen,” Heiman said. “We were attractive not only because of location, but the job was also a bigger opportunity for this person.”

Heiman’s fishing allowed him to make the right offer to the right person, but cinching the deal required a client willing to move mountains to get its candidate.

“With this guy, there was a situation where he had a year-end bonus coming up, and it was big,” Heiman said. “He was eight months into it and didn’t want to just walk away from that. But my client stepped up and wrote a large check to hire him when they wanted him.”

Guarding human assets

Executive positions, in general, are hot battlegrounds for talent, along with skilled positions in engineering, technology and financial services. Avoiding a loss of people in such key areas can require a different style of management today than when baby boomers were the primary force in the workplace, said Jeanette Coleman, director of human resources for Axcet HR Solutions in Lenexa.

“You’ll find that the good managers today work for their employees,” Coleman said. “All of my employees are experts at what they do, and I’m here to make sure my employees have everything they need to do their jobs and get them done. When they say, ‘This is a better way to do something,’ I listen.

“It didn’t used to be that way. It used to be a drill sergeant mentality was prevalent.”

Smith agreed, saying the best thing an employer can do to strengthen the bond with employees is to ask their opinions. Unfortunately, it’s common for leadership to impose solutions on employees without getting their buy-in or asking for their input.

“In my experience, the places with the lowest morale have leaders who are least interested in finding out how employees really feel,” she said.

Jim Rine, president of UMB Bank in the Kansas City Region, said he’s well aware that recruiters contact his people and would love to cherry-pick them.

Heiman said banks like UMB and Commerce Bank are big targets for recruiters because they provide management training programs that make their people valuable.

But those training programs also are a key weapon to combat recruiters, especially when used in conjunction with other tools. UMB provides a flat organizational structure with ready access to management. It couples that with discussion about developing career tracks and providing training to help employees improve and advance.

“Recruiters seem to have access to everyone,” Rine said. “Generally, though, the defense is to work on development plans with key associates to make sure that we’re delivering what’s important to them. Every associate has a development plan, and it includes things that are important to them, not just at work, but outside the line of business.”

Rine said the most important factors for retention and recruiting are a culture in which employees feel they are part of something bigger and planning to help employees gain the skills they’ll need to advance their careers.

“When you feel you’re a part of something, you’re less apt to jump to a new job just for money,” he said. “I think when competitors come in from out of town, unless it’s a specific leadership opportunity that our folks were looking for, we are able to do a fantastic job retaining our talent.

See also Dan Heiman’s television interview on this subject