Talent acquisition is not just about attracting and engaging talent. It’s also about retaining talent.
Talent leaders fail to prioritize retention through talent acquisition, mostly because ‘retention’ is not considered to be under their remit in most organizations. Moreover, the recruiting process can only partly influence people’s desire to stay after they have signed an offer.
And yet, both attracting and retaining top talent are top-of-mind issues for CEOs around the world. Talent attraction gets a lot of attention, but retaining top talent is an issue for companies who are worried both about filling future leadership roles and keeping costs of replacement down. 79% of business leaders told us a focus on recruitment rather than retention was a Talent Trap.
It makes sense, as losing a new employee means that the organization went through all the trouble of hiring them, but as they were still ramping up, the business hasn’t had time to benefit fully from having them on board.
Why do people leave?
According to our recent Talent Index research, 51% of people are planning to leave their job in the next 12 months. Jobvite research suggests 54% of those planning to leave their job have not looked internally for their next role.
Employees leave for different reasons. Sometimes they leave because they were a bad fit and the company made a “mis-hire” in offering them a job. Sometimes, however, a great employee is hired and decides to leave almost immediately after starting.
New hires leave mostly because their expectations didn’t match the reality of the day-to-day job or the company culture, or because they experienced an unpleasant incident early in their employment. Talent acquisition teams definitely have some margin to affect at least the first two factors.
How to improve employee retention through talent acquisition
Talent teams have always cared about retention. Retention rate is sometimes used as an indicator of quality of hire: it’s only a proxy, since talent teams do not control all the factors that influence early retention. But it is still a useful indicator.
However, talent leaders do not always design their strategy with retention in mind, even though they can directly influence it in a number of ways.
Getting to know your candidates
Nurturing candidates and building relationships has a direct impact on retention simply because it offers candidates the opportunity to learn more about the company. They get a chance to discover the culture, mission and values, and to learn the specifics of a type of job they might be interested in.
According to a Jobvite study from 2018, 32% of early attrition is reported to be caused by company culture. This can be largely improved through good proactive sourcing and candidate nurture programs.
There is a large element of expectation management in proactive recruiting. If two candidates accept an offer for the same role because they like the company, the product and the industry, but only one of them is prepared for the competitive environment and the occasional deadline crunches, the other one is far more likely to quit within a few weeks of starting.
Understandably, many talent leaders hesitate to prioritize retention in any meaningful way when they allocate resources and set team targets. Fortunately, they will have less of a tradeoff to make in the future, as they build a better talent pipeline, reinforce their employer brand, and organize their recruiting activities around nurture and long-term relationship building.
With recruiting becoming more proactive and candidates having more opportunities to get to know a company before applying to a role, mismatches between expectations and reality are less likely to happen.
This is probably the area where talent acquisition can make the most impact on retention. Instead of hiring for brand names in the candidate’s past experience, or based on the current job openings, more and more talent teams are advising hiring managers on how to hire for skills and development potential.
Skill-based hiring is a proven way to retain top talent. The model below is an example that applies specifically to executive hiring, but the methodology can be applied to most other role types.
Mobility programs owned by Talent Acquisition
Internal mobility ties into skill-based recruiting, because they are both made necessary by the fact that candidates need growth and development opportunities to be fulfilled at their jobs, and it is much easier to offer them these opportunities if they are hired with upward mobility in mind.
The concern over holding on to top talent for the long-term success of the company is real: in The Talent Trap, less than half (45%) of business leaders said they felt confident in retaining key talent. And yet, internal mobility is still a company’s best bet for key roles, as it costs less and produces higher quality talent.
A joint ownership of internal mobility programs between TA and HR can be a great way to manage internal mobility. Balfour Beatty’s talent team launched an internal careers program that tackles the issue of retention. The program obviously had other positive ramifications, such as strengthening loyalty to the employer brand and increasing referrals, but the main aim was to make it easier to identify employees at risk of leaving, and provide them with clearly outlined growth opportunities within the company.
Pre-boarding and handoff to HR
Talent teams have more influence over the onboarding process than they did before, given how much of the candidate journey they can tailor and automate at very little cost. Every detail they add to the experience that ushers a new candidate into the company matters, from simple email cadences to point out helpful pre-start resources, to introductions to the teams they are interested in, to invitations to company events where they can meet other candidates or new employees.
The fact that 83% of high-performing organizations start onboarding before Day 1 is not a coincidence. This transition time from candidate to employee is when talent acquisition and HR have a chance to deliver on what the candidate was promised. The company gets one chance to make a first impression as a workplace, and both talent acquisition and HR can contribute to making it a positive one.
Talent acquisition strategies can have a huge impact on employee retention, and it is up to talent leaders to push for the kind of talent transformation that can help companies keep their top talent longer.
This added responsibility adds to the growing complexity of the talent acquisition function, but that goes hand in hand with their increased responsibility in the business. Talent acquisition is getting a seat at the executive table, and that does not come without a cost.