Let’s dive into a hypothetical situation. You have a vacant position and think you’ve found the perfect candidate! John accepts your offer and joins the team. After two weeks, John hands in his resignation. This is the third person that has left before the end of the probation period. Is the position cursed?
If this situation is something you’ve experienced you may need to take a step back and zoom in on specific details of your business.
How do you know if this is relevant to you even if you haven’t experienced this scenario? Here’s a quick checklist:
- Your company experiences regular internal conflict
- Your company has poor retention rates
- Filing a role is difficult
- Your HR department is unhappy and constantly complains
If any of the above are applicable to your company, your business is suffering the consequences of continuing normal operations whilst infected with a parasite that executives have overlooked.
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Overlooking internal problems such as poor employee retention is detrimental for SMEs because an unestablished business is already fighting to build strong foundations, so an unsound internal infrastructure will significantly increase the risk of business failure.
I’m sure by now you’re wondering, ‘what’s the parasite?’
Let’s start with understanding recruitment.
Employee retention 101: Understanding recruitment
Recruitment’s purpose is to source and recruit new candidates to fill vacant positions in a business. The outcome of recruitment is to have more resources that aid the businesses progression.
We all know how costly mishiring is — hiring the wrong candidate not only mispends recruitment budget but also consumes a significant amount of HR and recruiters time that could be invested elsewhere.
So, what if recruitment brings onboard new candidates who leave quickly? Do you have poor recruiters that aren’t good at their job?
It would be easy to blame recruiters for mishiring candidates, but unfortunately this is only the tip of the iceberg.
Recruiters need to source candidates that have great skill and will be a good cultural fit, however, they also need to sell the company to the candidate. They need to make working for the company seem desirable.
The problem arises when recruitment markets a dream job that meets all the requirements voiced by the candidate, but when the candidate starts they quickly release they’ve been misled.
Here’s the parasite
The example with John is a classic (and very common) example of what happens when there’s misalignment within a company.
If you deep dive into the real reason behind poor employee retention rates, it starts at the top — with the board and executives.
Consider this simple example relevant to a pandemic’s changed workforce:
Sarah needs flexible working hours because she has a young child who needs to be picked up from school. Sarah is promised this won’t be an issue, but when she begins the position she releases her managers are firm on her 9-5 working hours. Obviously, this is unsustainable for Sarah so she leaves.
Sarah is not a poor quality candidate, she’s just the wrong candidate.
HR is aware of the company’s structure, and knows any issues make the company seem undesirable to work for, so they try to disguise them. Putting lipstick on a pig.
Regardless of the company’s undesirable traits, they have a job to do. They need to hire a new employee, but they know if they’re honest about the current workplace they probably won’t attract the quality candidates the executives expect.
The reason we label misalignment as a parasite is because it functions the same: it attaches to a host (the business) and feeds at the expense of the host (misalignment causes regression). The longer & more it feeds, the greater the significance of its presence. In relation to our example, the worse the output of the business.
Therefore, this issue starts and ends with executives.
Executives are responsible for all misalignment within a company. Executives must direct employees and initiate change where necessary.
If employee retention rates are poor, there’s certainly a reason for it. If employees are satisfied they will stay. Therefore, if many employees are not staying it’s a huge hint: it’s not them, it’s you.
Executives need to have defined the business structure and expectations. You can’t have one person preaching flexible working hours, and another preaching rigidness.
It starts with executives and flows down the hierarchy.
In saying this, it’s not to say the executives are 100% correct on their definitions and what was once deemed effective will always be effective. Hasn’t COVID-19 shown us the exact opposite?
It’s not only up to HR and employees to stand up and express their needs, it’s up to the executives to be present in business operations, ask questions, seek suggestions and uncover problems.
This prevents misalignment and creates a stronger business. Proactiveness ensures the business is continuously modernising themselves and remaining progressive in a constantly changing workforce.
Solutions for a misaligned business
The solution to misalignment will depend on the extent of its presence and the size of your business.
For a SME, realignment is easier to achieve. The reason being the communication channels are smaller and the implementation of change is quicker. It’s critical to consider this issue when starting a company — think defensively.
Executives are the leaders and rule setters. Before you consider expansion, ensure you have defined:
- You business model
- Your company values (Flexibility? Innovation?)
- Your vision (what are you working towards?)
- Your mission (what do you want to achieve?)
- Your employee value proposition (what makes your company desirable to work for?)
Once you have accurately defined the above, you’ll reduce potential for misalignment and make it easier to source and recruit suitable candidates.
You can still hire whilst having misalignment within your business, however, executives and leaders need to be on the same page as HR and recruitment.
This allows them to be transparent with candidates. Instead of putting lipstick on a pig and trying to disguise problems, HR can be upfront with candidates and rest assured any issues are a work in progress.
Poor employee retention rates are costly, and stunt productivity and progression. Poor retention rates, internal conflict and an unhappy HR department should immediately indicate an issue within your business that needs addressing.
You know your business better than anyone. The longer an issue goes unaddressed the further it will contaminate your operations and output. Be a leader and take initiative — it’s up to you.
MyRecruitment+ is an Australian based cloud software that enables HR to manage their recruitment and onboarding activities from one location. MyRecruitment+ promotes productivity and collaboration, and seamlessly integrates with current HR systems to offer an end-to-end solution for sourcing, managing, processing and hiring candidates. Clients are located in AU, UK, USA, CA and NZ and include SBS, Breville and Feros Care.