I had the pleasure of moderating a panel at the annual Family Business forum on October 4. I thought I’d share some of the takeaways from a very lively best practice discussion regarding talent from a family business perspective.
Here are 8 ways family businesses are attracting and retaining talent:
Promote your family business brand and culture. A culture focused holistically on the employee is appealing and often in contrast to the experience at non-family owned companies. Capture why people love working at your company and promote it.
Family businesses understand that attracting great people is directly connected to creating an attractive culture. A strategy connected to this is to focus on generating employee referrals. Referrals was the top method for finding people within our panel. You will not be able to out-spend larger companies on cool technology and automated sourcing. When hiring the right people - culture eats skills! Focus on finding people you believe will thrive in your environment even if you have to teach them some of the skills they will need.
Culture, Culture, Culture
You could say it all comes back to culture. It connects to every aspect of talent management from hiring to retention. It is critical that the external employer brand be congruent with the actual employee experience – walk the talk. An environment that invests in their people with coaching, mentoring and feedback will prosper. The group discussed how employees want purpose, so connecting them to volunteer opportunities and doing these as a team is another idea.
Amy Saunders, VP of HR at Praxis Packaging answered the question - "How do you audit your culture?" She suggested asking employees to give three words to describe the company culture. Take all those words and plug them into a Wordle. This is your culture!
Hiring for Culture Fit
Once you have defined the culture, you can use different strategies to make sure you are hiring the right person. Chris Shepler, President of Mackinac Island Shepler Ferry Service uses the Disney approach of clearly defining expectations and work environment through extensive communication and videos that give prospective “cast members” this view. This helps candidates pre-determine if they will fit - seeing is understanding.
Another way to mitigate risk was described Sandy Buchanich, Director of Talent Development and Engagement at Byrne. She described their process of immersing the potential employee in interview and pre-employment exercises that allow the candidate to experience both work and environment at Byrne. This also gives Byrne a more realistic audition than is typically gathered through a traditional interview.
It’s important to list the intangible qualities that determine culture fit and then interview and measure candidates against those qualities just as you would for experiential qualities.
We are defined by the decisions we don’t make as much as the decisions we make. It is critical to take timely action with poor performers. It is hard to fire someone but failure to make those decisions timely will put your top performers as risk of leaving.
It was mentioned by Lou Rabaut, Partner and Employment Attorney at Warner Norcross and Judd that often the most compassionate move is to be honest with the employee and allow them a path to find their right role. Creating a culture for change is often difficult in an environment with many long term employees. Having a mix of newer employees along with longer term employees will help create a culture of change. Creating this will require an intentional approach by management.
Employees who have their needs fulfilled are often more engaged at work says Lou Rabaut. He suggested a good model to help develop that understanding is Maslow’s hierarchy of needs.
This fulfillment of needs can be summed up as an environment that; empowers, values people, encourages relationships/partnerships while providing both opportunity and job security.
It is increasingly common to lose key employees over the topic of long-term compensation. Sometimes this is offered with good intentions at the time of hire, but it becomes an issue when it is not put in place soon enough (or at all).
Most executives who work for public or private equity owned companies get some form of deferred compensation and/or equity. Family-owned companies will be challenged to find creative solutions in order to compete. It is important to create retention plans for all your key non-family employees. The war for talent clearly includes retention as well as hiring.
Also, feedback is extremely critical to the millennial generation. Managers need to be better listeners and mentors in this highly competitive market so they are better positioned to provide constructive feedback. Clearly, intentional strategies to engage and retain employees are critical in this environment.