Date Published: December 02, 2015 - Last Updated 3 Years, 24 Days, 9 Hours, 42 Minutes ago
In our parents’ and grandparents’ eras it was typical to get a job, stay there for decades, and retire with a pension. It’s undebatable that the status quo has since changed. Now job-hopping is thought of as the norm with expected tenures shrinking to as little as two years. The sometimes hard to swallow truth of the matter is that your high performing talent is your company’s most valuable asset. Why do your most highly valued employees leave you? A Gallup poll found that the top reason employees leave is for career advancement or promotions. If you aren’t continually sowing your fields by means of internal promotions, eventually your grain silos currently full with talent will be depleted and empty. There is hope for retaining top talent in your organization through the means of internal promotions.
If the current paradigm in your office is to disregard internal candidates in favor of external hires, consider the potential costs of losing your best and brightest top performers. When an employee leaves for a promotion it’s rare that they’d change industries too, meaning they are taking their high level of execution and internal expertise to your competition. That’s like your favorite sports team giving away an All-Star player to a division rival for nothing in return! When it happens, your competitors get stronger, and you just end up weaker. Most likely you’ll be forced to double your recruiting efforts, too, since you will need to fill the original open positions--as well as other roles vacated by talented employees who were passed over. While you may place extra weight on an external candidate’s education or outside experience, you may be neglecting consideration of the cost of bringing them up to speed. A study referenced in Forbes shows it takes TWO YEARS on average for an external hire to catch up to the performance review scores of internal promotes.
In light of the heavy costs associated with forgoing internal promotions, there are a myriad of other benefits associated with developing and promoting candidates from within. As employees become more skilled in their current positions, the law of diminishing returns starts to come into play. Employees need to be challenged to stay invested. Promoting your top talent from within inspires them to grow and drive more internal successes down the line, while keeping them in-house as a knowledgeable resource for their replacement to lean on for guidance in the future. One of the best benefits though, is that it shows a commitment to your workforce that drives loyalty and motivates employees to be more productive. This helps to develop an internal culture of recognition and trust in management. Your most talented workers will work harder and with a smile, knowing that there is a destination that they are working towards. This is the same type of positive culture that employees leave to acquire, thus you will begin to naturally attract more external talent with less effort.
Perhaps there isn’t always a steady supply of promotions to meet the number of amazing individuals you have working for you. This is a great time to evaluate incorporating more flexible roles into your office hierarchy. If you build job roles around the strengths of the talent you have on hand, you can create the type of challenging and engaging positions that boost morale and loyalty, while continuing to add value to your organization. Break the mold of rigid corporate ladder rungs and utilize the resources you already have to achieve your company goals. If you’re not developing and promoting from within, you’re risking the loss of your internal talent.