Joe Bertotto, Chief Culture Officer MY CU Services states, “While all companies lose valuable employees through relocation or family changes, losing them because of a poor culture are preventable. Building a great workplace requires intentional effort but the benefits of having a highly committed, unified team of employees will prove priceless” (Bertotto). As Joe suggest building culture is not easy, nor is it a quick process as it can take years to set up a good culture. However, he also says that the benefits of doing so are “priceless”. So priceless in fact that many companies such as Joe’s employ an executive with the sole purpose of building culture called CCO’s (Chief Culture Officer).
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However, external factors, such as recessions, also affect retention. Recessions affect a company’s ability to retain employees because money in the economy is short. People tend to stay with their company regardless of how the bad the situation is. The possible labor crunch will affect retention in the opposite way, and is the main factor for this paper being written because companies will be struggling to fill their positions. In a labor crunch employees hold all the power, and are therefore likely to leave at a drop of the hat.
Scanning the external environment for threats to a company is nothing new to businesses, but keeping retention in mind while doing it is. Yet, this is another reason why HR needs a representative on the executive team that is viewed as a strategic partner. This HR executive could make sure the external environment is being scanned and analyze the data in order to make suggestions to the CEO and the rest of the executive team.
Another external aspect is industry trends as it relates to retention. For example, is the industry requiring more education for employees because technological increase, and are subsequently having to pay more for their employees. What the industry trends are and what competitors are compensating has a direct result on retention rates because employees will likely leave if their companies are not keeping up.
HUMAN RESOURCES AS A STRATEGIC …show more content…
Our book suggests using the ARDM approach to HRM where HR professionals diagnose the problem, prescribe a fix to the problem, implement the prescription, and finally evaluate the end results of the prescription (Ivancevich and Konopaske pg. 32). Think about how ridiculous and costly it would be if HR managers implemented policies and procedures without ever diagnosing a problem in the first place. This is why I mentioned surveys as a tool to determine the heartbeat of how employees are feeling. The surveys can then be turned into policies, procedures, or trainings to alter the culture of the company. Furthermore, the surveys could also suggest a problem with compensation because compensation is so subjective if the company does not know their employees, then compensation is likely not to be viewed as fair.
However, as brought up by an interview of Jessica Lang SPHR a senior HR consultant for Cornell University, “Not all turnover is bad because you need new individuals coming into a company to provide new ideas” (Lang). It is not the intention of this paper to eliminate turnover because as Jessica mentioned some turnover is healthy. However, as suggested by Jessica if the turnover is reaching double digits it is time to figure out how to lower them