Growth as a staff retention strategy

I wrote last week about how your people are your organization’s most important asset. That’s why recruitment, retention and staff development are critical functions in an organization.

But at least recruitment — undervalued as it often is — has an organizational home in the HR department. Retention, development and promotion? They don’t exist anywhere. No one owns them for the organization. An old boss of mine used to refer to the heartbeat principle: if there’s no person who owns it (whose heartbeat depends on it) then it probably won’t happen.

Good managers think about the retention and development of their direct reports, but organizations struggle to support this. No one wants to hear about retention until the problem reaches a pain threshold, long after it’s had negative consequences on output. There are few resources available in most organizations and nowhere to turn for help.

Sadly, there are legitimate reasons for this under-emphasis on retention and staff development. In the short-cycle project world that characterizes much of aid and development, retention is hard to plan beyond the end of the grant or contract. Staff have grown to expect a new assignment in a year, give or take, feeding into a cycle where they don’t invest in the organization and the organization doesn’t invest in them. Meanwhile, a well-intentioned effort to reduce reliance on international staff can (in some labor markets) drive poaching of national staff. (Of course there’s a broader trend across sectors toward shorter-term positions and career paths that jump organizations.)

The much-maligned HR department.
The much-maligned HR department.

Can we do anything to give retention and development more prominence? At a personal level, managers can choose to care more about their people. Organizations can strive to make it part of their culture. And motivated staff can seek out what they need from their supervisors or HR. These sorts of measures are helpful.

However, these solutions lack structural or strategic backing. They aren’t tied to the first-order drivers of an organization’s success. That makes them flimsy and easy to sacrifice in a pinch.

What if the organization felt more pain from the loss of good people? One approach to this lies in growth: new projects, new business, new locations. This is premised on the idea that the best people want to see progress in their careers. If they’re doing the exact same job two years later with no upward motion in sight, they get bored and start looking for something new. That’s why I keep referring to retention and development as if they’re the same thing. They aren’t quite, but I see them as very closely linked.

Someone first pointed out the growth-retention link to me at the same job where I learned the heartbeat principle. It was a publicly traded, mission-driven company. That’s a rare combination. For-profit, sure. But why go public? Other than the obvious fact that quite a few early executives earned a big pile of cash from it, there’s a mission-driven aspect to it as well: shareholders demand returns, returns require growth, growth provides new opportunities for the best staff, new opportunities demand development, development promotes retention, retention maintains current business.

The company had a built-in accountability mechanism that drove a focus on retention and development.

There are still hurdles. Growing fast is dangerous too. I know at least one popular social enterprise that stretched its systems to the seams with rapid growth and ended up with high turnover. Managing that growth is also difficult for small organizations when business growth and capacity growth come in different-sized chunks. For large organizations, the problems lie more in the question of where to find that growth after the obvious avenues have been filled.

So let’s qualify things to say that well-managed growth can drive the retention and staff development necessary to have high impact across both current and future business. It doesn’t happen naturally though. If it’s both deliberate and opportunistic, growth can be a retention strategy.