My March 17 posts talk abut the cost of attrition, i.e., the value of retention, but who would have thought that that retention could have a global impact, moving inflation and economies?

How Rising Wages Are Changing The Game In China in the March 27 issue of Business Week discusses at length the efforts multinationals are going to retain their people and hold down salary inflation, and although the salary figures mentioned may seem paltry compared to salaries elsewhere, the percentage increases certainly don’t!

Sure, the companies are spending major money to add perks, but much of what they are adding is in their infrastructure, so the pay-off is higher. And unlike higher salaries (remember, people who join your company for money, will leave for more money), matching them is more difficult for the companies on the prowl for employees.

Closer to home, how do small companies match the perks offered by large ones, especially since, for many employees, stock options don’t hold the allure they once did.

Guess what? We’re back to the intangibles offered by culture (i.e. MAP), which is good, since intangibles are the hardest perks with which to compete. In over 25 years of headhunting, the desire to work for a specific manager, not company, was the primary reason for lack of interest in changing, no matter what opportunity presented itself.

By the same token, if a manager, who had created a positive mini-culture in a company that didn’t support it (a more common occurrence than you might think), left the turnover could easily hit over 70+% during the next 12 months.

The best intangibles you can offer consist of public positive strokes, i.e., publicly acknowledging accomplishments, both large and small, and private constructive criticism and guidance, focusing on improvement in order to excel.

Back on the tangible side, don’t under-rate the motivating effects of candy, pizza (sushi in California, NYC and a few other locals) and food in general. They work when used with flair and élan—and a sense of fun:)

This entry was posted on Wednesday, March 22nd, 2006 at 8:25 pm and is filed under Business info, Culture, Hiring, Retention. You can follow any responses to this entry through the RSS 2.0 feed.
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