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Ensuring Capacity for Growth - Employee Retention

Posted September 9, 2008 1:18 PM by Ted Jackson

I've worked with many Balanced Scorecard organizations, and when it comes time to think about Learning and Growth (sometimes called the People perspective), leaders inevitably come up with an objective called "Hiring, Developing, and Retaining Talent." The measure can be different for different organizations depending on their strategy, but there is always a discussion about whether "employee turnover" should be the right measure for the organization.

I have never really liked employee turnover because I didn't think it captured the richness of employee issues related to developing and retaining talent. The Nonprofit Times this week also addressed the issue of employee retention in an article called Staff Burnout: The 5 Deadly Sins. These 5 issues were originally identified by Mark Murphy of Leadership IQ. I'll summarize them here and give my thoughts on how they relate to strategy management. The sins are:

  • Treating Everyone Equally
  • One Size Fits All
  • Neglecting the First 90 Days
  • Letting Them Leave
  • Turning Your Back

It is in this first sin, Treating Everyone Equally, where employee turnover goes awry. Employers should be most concerned about their key employees, and they should be careful to define "key employees" as those that play critical roles in their strategy. Since different organizations have different strategies, the key employee would differ from one organization to the next. There has been some excellent writing about aligning employees to the strategy and the Balanced Scorecard through job families by Drs. Norton and Kaplan in their book Alignment.

The idea of job families and simply key jobs forces an organization to realize that it does matter which employees you lose. This makes you realize that employee turnover is not as helpful as a measure like "voluntary turnover in key job positions" or a more positive measure like "staff engagement survey results of key personnel." I think the other "sins" map more closely to traditional HR, but reading about the first one really made me think about strategy execution.

Filed Under Balanced Scorecard