# Presentation: 265565

## Retaining Your	Hot Skills Employees . . .		Use Dollars AND Sense

- dH

## Hot Skills Market Still Strong

**Business demands ******
**Demand for Hot Skills ******
**Pay ******
**Turnover for high tech is 12%**
**26% of companies have >10% high tech vacancies**
**Takes half of companies 2 - 4 months to fill vacancy**
**25% cos. have >20% contractors**** **
- Reference: Hewitt Spring 2000 HOT Technologies Survey, Private studies

## Skill Premiums

- Reference:  Hewitt Spring 2000 HOT Technologies Survey

## Recent Top “Ten” Hot Skills

_**Fall 1998**_
**SAP**
**PeopleSoft**
**BAAN**
**Oracle**
**Data Mining**
**Disaster Rec**
**Call Cntr Arch**
**Y2K**
**Middleware**
**Telecomm Engr**

_**Spring 1999**_
**SAP**
**PeopleSoft**
**BAAN**
**Oracle**
**Object Engr**
**Disaster Rec**
**Call Cntr Arch**
**Rel DB Mgmt**
**Num/NonNum Rch**
**EDI/E-Commerce**

_**Fall 1999**_
**SAP**
**PeopleSoft**
**Y2K**
**Data Visual**
**Object Engr**
**Disaster Rec**
**Multi-media**
**Rel DB Mgmt**
**Num/NonNum Rch**
**Middleware**

_**Spring 2000**_
**Web Infra**
**PeopleSoft**
**SAP**
**Y2K**
**Data Whs**
**Num/NonNum Rch**
**Middleware**
**Supply Chain Mgt**
**Voice Sys Engr**
**Object Engr**
**Web Security**
**EDI/E-Commerce**
**Web Des/Dev**
**Data Visual**

## Varied Market MovementsTotal Cash — Examples

- Reference:  Various Hewitt HOT Technologies Surveys

## Bonuses

- Reference:  Hewitt Spring 2000 HOT Technologies Survey

## Bonus and Base- Averages by Job -

- Reference:  Hewitt Spring 2000 HOT Technologies Survey

## Stock Options

**Only 1/3 employees eligible**
**13% of employees receiving**
**Up from 10% Spring 1999**
**Average amount received 23% of base**

- Reference:  Hewitt Spring 2000 HOT Technologies Survey

## Who Are They?

**Population — non-managers**
**Half 37 years old or less**
**Half in IT profession 8 years or less**
**Half with present company < 3 yrs**
**Half expect to remain <2 yrs**
**48% currently looking for a job **
**8% actively, 40% somewhat**
**64% contacted by recruiters in past 12 months**
**Of those, half contacted at least 3 times in past 6 months**** **
- Reference:  *InformationWeek* Research Salary Survey of 16,900 IT Professionals Spring 2000

## What IT Folks Want

**What IT people say matters most to them about their job — top four**
**Challenge of job/responsibility**
**Flexible work schedule**
**Job stability**
**Base pay**

- Reference:  *InformationWeek *Research Salary Survey of 16,900 IT Professionals Spring 2000

## Situation Summary

**Market is strong, very dynamic - $ and people**
**Rate of increase in market pay is slowing down**
**Continues to be a churn as to which skills are the hottest**
**Prevalence and amounts of bonuses leveled off**
**Use of stock small but slightly increasing**
**Majority of people are Gen Xers**
**Challenge of work is still most important**

## First Step — Vital Signs

**Where is the pain?**
**Quick, simple, quantitative**
**Hot skills market position**
**Turnover**
**Hiring cycle**
**Applicant ratio**
**Determine**
**Areas needing immediate action**
**Areas needing more information**

## Market Analysisby Individual

## Above market range of pay

## Market Analysisby Skill/Organization

## Market Analysis

**Thresholds for concern**
**JUDGMENT call**
**Not formula-driven**
**Consider ...**
**Individuals — compare to 20% below**
**Skills/IT organization — compare to 10% – 15% below**

## Triage for Low Pay

**Identify CRITICAL individuals or skills**
**Critical to business goals**
**Another JUDGMENT call**
**Consider ...**
**Raise base pay to within 5% of market base pay**
**Target near-term total cash to 5% above market total cash**

## Turnover

**Identify “who” is turning over**
**Voluntary, “regrettable quits”**
**By skill and level**
**By organization**
**By criticality of projects working on**
**Acceptable levels vary by organization**
**Compare to 12% average for high technology employees**

## Action for High Turnover

**Do pay triage if needed**
**MUST identify reasons**
**Ask employees**
**Top three issues they think need addressing**
**Top three things they like**
**MUST take action on feedback**
**Often, poor management will be an issue**

## Hiring Cycle

**How long it takes to fill a vacant position**
**From initial recruiting activity to starting on the job**
**Compare to 61 – 90 days on average for hot skills**

## Action for Long Hiring Cycle

**Build process map**
**Identify and remove roadblocks**
**If timely offers declined**
**MUST find reasons**
**Ask new recruits for improvement suggestions**
**Ask declines for reasons**

## Applicant Ratio

**Number of applicants per employee**
**Compare to median of 3.9 per mgr/prof employee for Best 100 companies**
**Top three attractions for IT professionals**
**Reputation of IT function**
**Reputation of company**
**Promise of doing innovative technical work**
- Reference:  People Practices of the 100 Best Companies to Work for in America 2000, CIO Communications/ICEX Survey 1998

## Action for Low Applicant Ratio

**Identify reasons**
**Map and analyze recruiting process**
**Examine company and IT reputation**
**Examine characteristics of “100 Best Companies to Work for in America”**
**Develop YOUR “best practices”**
**Market your IT prowess**

## Retention	

**“****Retain” according to Webster’s dictionary . . .**
**To “hold or keep in possession”**
**To “engage the services of”**

## Employment Relationships

**	****Comfort zone**
**Full time**
**On-site**
**Uninterrupted tenure**
**Exclusive focus**
**Job centered**
**Independent**
**Low turnover**

**	****Discomfort zone**
**Fluctuating time**
**Multiple locations**
**Interrupted tenure**
**Non-exclusive focus**
**Skill and task focused**
**Interdependent**
**High turnover**

## Why Is Retention Important?

**Consistency of work, ability to meet goals **
**Quality of work and products**
**Business, customer, and work history and context**
**Productivity and efficiency**
**Control of activities**
**Skill, knowledge and capability**
**Culture, value and purpose constancy**
**Escalating turnover impact and costs**

## How Can We Get There with High Turnover?

**Rapid integration of new employees**
**Rapid competency development**
**Effective project management and tracking**
**Employees with multiple skill sets**
**Easy access to knowledge when needed**
**Clear goals, expectations, processes**
**Continual learning, feedback and knowledge transfer**

## Opportunities from High Turnover

**Constantly challenging status quo**
**Fresh perspectives**
**Introduction of new thinking**
**Conscious transfer of learning**
**Innovation**
**Disruption of complacency**
**Greater awareness of key support systems**

## Looking at the Whole Picture

**What is YOUR picture?**

## Create Your Retention Profile

**Analyze loss: turnover rate, skills lost, reasons for loss**
**Analyze gain: tenure profile, skills you keep, reasons for staying, acceptance ratio, job satisfaction or engagement factors**
**Identify your retention risks**

## Retention Strategies

**Competitive compensation**
**Strategic people  practices**
**Workforce strategy development, execution and change**

-   **Required**** **
-   **Key differentiators **** **
-   **Critical supporting****      systems**

## 	   Hot Technologies
92% alternative work schedules 
28% mentoring programs
8% paid sabbaticals
63% on-site ATM
32% convenience services
9% personal concierge services

12% voluntary turnover (high tech employees)

- 92% alternative work schedules
- 28% mentoring programs
- 8% paid sabbaticals
- 63% on-site ATM
- 32% convenience services
- 9% personal concierge services
**12% voluntary turnover ****(high tech employees)**

**	****    ****100 Best**
- 100% alternative work schedules
- 64% mentoring programs
- 29% paid sabbaticals
- 82% on-site ATM
- 77% convenience services
- 26% personal concierge services
**10% voluntary turnover ****(mgr/prof employees)**

**Hot Technologies Survey Participants and 100 Best Companies**

- Reference: Hewitt Spring 2000 HOT Technologies Survey,  People Practices of the 100 Best Companies to Work for in America 2000

## What You Need to Find Out

**What are employees experiencing in their work here?**
**What are the primary reasons that people join and remain in the organization?**
**Why do some employees contribute extra effort and others do not?**

## Engagement

**“****A state of emotional and intellectual commitment to an organization”**
**Engaged employees will be more likely to**
**Stay with an organization despite competitive offers**
**Express a consistently positive viewpoint about their company**
**Exert discretionary effort that contributes to business results**

## Overview of Engagement

**The Seven Factors**

**Customers**

**Opportunity**

**Growth/**

**Development**

**Advancement**

**Interaction**

**Quality of Life**

**Time/Work/Life **

**Leadership**

**Credibility**

**Trust**

**Relationships**

**Coworkers**

**Managers**

**Work Activities**

**Impact**

**Challenge/Interest**

**Status/Pride**

**Total Compensation**

**Pay/Financial recognition**

**Benefits**

**Culture and Purpose**

**Sense of purpose**

**and behaviors**

**Engagement**

**Organizational values **

**Physical environment **

- Reference:  Hewitt Associates LLC Engagement Model

## Enhancing Engagement at One Company’s IT Groups

**Enhancing Engagement at One Company’s IT Groups**

## Key Considerations

**Identify your retention needs**
**Create your retention profile**
**Determine the “systems” that will help you manage well with high turnover**
**Match these with your IT and business strategy**
**Work in partnership with IT**

## Managing the Hot Skills Contradictions

**	****I want ...**
**Autonomy**
**Flexible assignments**
**Promotions, fast rise**
**Sense of community**
**Continuous learning**
**High compensation**

**	****and I want ...**
**Team membership**
**Specific roles**
**Short tenure**
**Remote, flex-hours**
**Critical assignments**
**Greater life balance****	**

## Retaining Your	Hot Skills Employees . . .		Use Dollars AND Sense

- dH

**Retaining Your****	****Hot Skills Employees . . .****	****	****Use Dollars AND Sense**

**John H. Davis, Ph.D., CCP**
**Hewitt Associates**
**Suite 100**
**2201 West Royal Lane**
**Irving, Texas  75063**
**972-402-8700**
**www.hewitt.com**