|Lessons learned about employee retention |
Industry estimates put turnover costs at between $5,000 and $100,000 per employee. Framingham, Mass.-based analyst firm International Data Corp. (IDC) estimates the cost of IT worker attrition in 2002 will reach $7.6 billion. Recruiting is expensive. Headhunter's fees average 30% of an employee's annual salary. Ensure your compensation package is competitive. Look at salary, incentive bonuses, and stock awards. Retention should be a top priority. Don't just give it lip service. Get corporate buy-in. Bend the rules a little--i.e., extend corporate policies and perks down the IT ladder to lower-level managers. Set aside more money for incentive bonuses in the IT department. Set aside a budget for fun activities and training programs. Provide top-notch training. Technology changes quickly and IT workers want to keep abreast of these changes. Recognize a job well done. Set up an awards program. Pick monthly winners and have an annual raffle or party to celebrate all the hard work. Award prizes. Put winners' pictures in a prominent spot in your office or on your Web site. Have some fun! Take the staff to a ball game. Cater dinner from a gourmet restaurant. Take a boat ride. Go bowling. Give each team member a stress kit (a basket filled with cola, sweets, and stress balls).
The company's Star Award program offers recognition and, ultimately, the chance to win trips to Disneyland and Hawaii. Awards have been given for successful system conversions, new Web site designs, helping another group achieve its goals, or for working above and beyond the call of duty in order to make a delivery date, notes LeFort. The big prizes are awarded annually at a drawing held during a department wide social event, but IT individuals and workgroups are recognized monthly through the program. In addition to having their pictures on the Web site, monthly winners in this peer-recognition program are eligible for prizes such as dinners out or an American Express gift certificate.
Monthly winners from United HealthGroup's 10 IT sites, from as far away as Ireland, link up via video to participate in the annual Star Award celebration. Hi-jinks have included a step-dance demonstration from the folks on the Emerald Isle. The company gives away between $25,000 and $30,000 worth of prizes at the annual party. Along with big trips, IT employees can win checks for $500 or $1,000.
LeFort says these programs and others have kept his turnover to about 14%. His department spends several million dollars annually on the learning institute, masters programs, Star Award, and other retention programs. More employees are benefiting
While perks for IT departments are on the rise, not all companies single out these hard workers for benefits. At Textron Inc.'s corporate headquarters in Providence, R.I., the 16 IT employees enjoy the same perks as other HQ workers, says John Lincoln, director of information management contracts and services. These include free use of a fitness center (which also provides freshly laundered workout shorts, shirts, and socks free of charge), corporate parties and picnics, and recognition through the manager spot award program, a recognition program for all corporate employees. A group of IT employees received the reward earlier this year for their hard work (including over the New Year's holiday) on Year 2000 issues. Textron has aircraft, automotive, industrial, and finance businesses.
Whether or not IT employees enjoy special perks depends on how critical IT is to the company's overall mission. Data-rich industries such as insurance and retail are more likely to offer perks beyond the norm, says H. Michael Boyd, Ph.D., a program manager in the human resourcing strategies program at IDC.
Boyd says large companies have been providing many "fun" perks for awhile, but only recently have begun extending them deeper within the IT ranks. For instance, while a top IT executive may have been driving a company car and getting reimbursed for her children's private-school tuition all along, these benefits are now being provided to IT managers further down the corporate ladder. Today, IT leaders can often send more staff to conferences, distribute more discretionary income than managers in other departments, and reimburse for more tuition than generally is allowed in other areas of the company.
"IT people are prima donnas
in the market," Boyd says. "That's life. Companies have to do these special things." // Lisa Gandy Wargo is an Atlanta-based writer who has been covering IT and business issues for the past decade. She can be reached at email@example.com.
You don't have to spend a million bucks to retain IT employees. Here's a sampling of some low-cost programs being instituted in IT departments across the country.
Retaining IT employees does not have to be an expensive proposition. While trips to Hawaii are nice, you likely will only be able to award such a perk to a handful (or fewer) of employees each year. Some of the most popular retention programs are also the least expensive. Here's a sampling of some low-cost programs being instituted in IT departments across the country: Casual dress.
At Carlson Companies Inc., 700 IT employees in the central infrastructure group enjoy a more casual dress policy than groups working in other buildings on the Minneapolis corporate campus. Khakis and collared shirts are standard Tuesday through Thursday, jeans allowed on Friday. In the summer, these IT folks can even sport denim shorts on Fridays. Alternative work schedules.
Carlson has implemented alternative work arrangements for IT employees--everything from 32-hour weeks to telecommuting. "The retention program that is most popular with me is flex hours," says Karen Bruns, director, IT, in the office of the CIO. Bruns started as a project leader in another Carlson operating group over five years ago. Recognition rewards.
While not quite as cheap as allowing your workforce to stagger its hours, these rewards more than pay for themselves in employee loyalty and morale. Winners usually receive a certificate or some trophy-type trifle. At United HealthGroup in Minneapolis, they often get a dinner out or an American Express gift check, and their picture appears on the company's Web site. The company takes the program a step further by giving monthly winners the chance to win big prizes at an annual drawing--this is where the trips and large cash prizes come in. Dinners, tickets to sports events, and free lunch.
Don't think you have to take the whole department. One IT manager in the Southeast, who asked to remain anonymous, buys a pair of Atlanta Braves season tickets and gives them to hardworking employees as a sporadic bonus. Personal pats on the back.
These can range from saying "good job," and really meaning it, to cards with all the reasons you value an employee noted. Book clubs.
At Fujitsu Network Communications in Pearl River, N.Y., one employee took it upon himself to institute a weekly book club meeting during lunch. The fiber optics communications systems company pays for pizza or sandwiches while employees discuss not the latest bestseller but technical books and journal articles. Mentoring programs.
These pair new employees with experienced IT folks who have been through similar circumstances. At Fujitsu, the emphasis is on employees coming from other countries. Carlson has the IT Foundation program for college hires and the Smarts program for anyone in the company's IT department who is interested.