Call for rethink on staff retention strategies

As the economy turns a corner, companies in the region need to assess their staff retention strategies, according to experts. And, that's not all. Following old retention strategies will not be the way to go forward, they believe, as no two recessions are absolutely similar.

There should be a different approach to solving manpower problems this time around and firms may be facing the risk of losing the right talent as a better economy and job market now offer more opportunities to those who last year had preferred stability to career growth.

Emirates Business spoke to three experts in the industry for their views on retention strategies in the region. They are Matthew Carter, Managing Director, McArthur Murray; Panos Manolopoulos, Vice-Chairman, Regions and Managing Partner Middle East, Stanton Chase International; and Marcos Simonetti, Middle East Director, Pathway Resourcing.

Do you think that companies using the recession as their retention strategy do so at their own risk? Are you aware of companies in the region following such a policy?

Matthew Carter: I think any company that has been forced to review its staffing numbers during a recession will have thought deeply about how this affects their retention strategy. Here, as in other regions, some companies may well have seen it as an opportunity to assess their human capital and decide how to proceed accordingly. For organisations that have a continual ongoing process of development and retention of their human capital, this is a regular management task.

Panos Manolopoulos: It is true that companies are following this kind of an approach because there is a good supply of senior executives in the Gulf Co-operation Council (GCC) states. However, one cannot find cheap talent if it has to be good quality. The same policy goes for retention as well. As the economy improves, executives are starting to look around and are more open and less conservative about switching jobs as compared to last year. Many executives are not happy with the way their companies handled the crisis and so will be willing to another job opportunity. We firmly believe that you cannot retain people through threats. This approach is not good for the company nor for the overall economy.

Marcos Simonetti: We are seeing that retention strategies currently being invigorated by a large number of businesses in the region are becoming increasingly sophisticated. Many companies are investing aggressively in training and career development programmes and those looking at gaining market share through talent acquisition, are also reviewing their current pay schemes to ensure they are competitive not only in the regional recruitment market but also on a global scale, particularly within the banking and finance sector.

According to a recent survey, many executives around the world seem intent on returning to pre-recession strategies and talent programmes – an approach some believe served them well following the 2001-2002 recession. Do you believe it's the same situation in the region as well? And, how different is the 2001-2002 recession from the current one in terms of talent management? Is it safe for companies to use old strategie?

Matthew Carter: Organisations that are now able to see where they are going, and are willing to focus on developing their people, ironically now have a rare opportunity to add value and acquire outstanding talent. Organisational structures have changed dramatically, along with how they behave. You will perhaps see many organisations adapt a matrix approach and as such, will need different people and develop them in different ways. Some organisations will remain entrenched in their old ways – sometimes this suits them – while others may fall behind.

Panos Manolopoulos: Every crisis is similar but with differences. This time around, the problem was more global and acute. The government and the financial sectors – the two pillars of the economy – were shaken badly and the uncertainty that followed, made people believe that nothing could be exactly the same as it was before the crisis. I would say, in general, we are moving to a new normal, and following all the old recipe that worked previously may not be a safe strategy.

Marcos Simonetti: The difference between this recession and the previous one in 2001-2002 is that in many sectors the world has become even more of a single hiring marketplace as opposed to regional divisions.

This is definitely the case with banking, engineering, information and communication technology and finance. The consequence of this changing landscape for employers is that they need to keep even more informed and up-to-date with what recruitment and retention strategies their rivals are adopting to ensure they can compete to win the best staff and also retain the ones that count. In this regard, many of our clients are strategising with us at present to chalk out recruitment and retention plans for the year ahead.

Do you believe that in the future companies in the region risk a resume tsunami as employees are keen to switch jobs with increased confidence from better times?

Matthew Carter: I think people will think more deeply about why they change employers. The career focused individual will not move just for money. It's about scope of role and where it leads to and the challenges therein. Some employers will possibly see more loyalty from staff, as they remained loyal to employees in the downturn. Those who treated their staff in an indifferent manner may well see some loss in headcount but maybe that is not a concern for them.

Panos Manolopoulos: Tsunami is a very strong term but we will gradually see more people looking out for newer and better job opportunities.

Marcos Simonetti: I don't expect a mass migration of candidates looking to capitalise on the increased buoyancy in the job market in the near future. Nevertheless, there will be an increased number of people prepared to investigate new opportunities.

Money is an important part of any retention strategy, but how important are non-financial incentives in holding back employees? Are non-financial incentives high on the list in the region with such a big expatriate population?

Matthew Carter: I think expatriates will look for better or improved soft benefits in terms of healthcare, education, insurance and probably contractual notice. The enlightened employer will use this opportunity to take all the risk out of an employees' package to enable them to focus on the job. You can already see this happening with some of the region's more successful companies.

Panos Manolopoulos: As far as the region is concerned, money is definitely the first priority, but we have also found that personal values and values of the corporate entities are also vital. Companies that do not provide these values and a good environment risk losing people. Often, candidates cite factors such as better authority, better work culture and value of human development as vital factors that may make them want to work with the company that adheres to these.

Marcos Simonetti: There is an increasing trend for candidates to commit to longer-term assignments in the region. With education, healthcare and infrastructure recognised as world class, there are many who are now calling the region their home. So, in this case, non-financial incentives such as training and career development do become key.

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