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Keeping valued employees– You don’t have to say goodbye

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Keeping valued employees– You don’t have to say goodbye

By looking for innovative ways to woo back former employees back, IT managers find new strategic staffing tools.

By Stephanie Wilkinson

October 1999

In this article:

CSX Technology Inc.

The Boomerang Effect
When The Grass Isn’t Greener
Retaining Vs. Rehiring
Reunited (And It Feels So Good
Strategies For Attracting Back Former Workers
What does it take to keep high-tech happy?
Portrait Of A Boomerang

One night last November, Joan Worthington went to a cocktail party at the Camden Club in Baltimore. She caught up with old friends, shared some wine and cheese-and went home
with a new job.

It’s not unusual for IT professionals to find jobs through friends at parties. Worthington’s story is noteworthy because her new employer is actually the same one she left seven years ago, and the company arranged
the party just to hire back former employees.

Jacksonville, Fla.-based CSX Technology Inc., Worthington’s employer, is at the forefront of a new trend in IT staffing-finding innovative ways to get valued ex-employees to return to the fold. The tactics for doing just this range from keeping in touch with former staffers through e-mail to hosting “alumni reunions,” such as the one Worthington, a pricing-system and project-management expert who left CSX to start her own consulting firm, attended at the Camden Club.

AT A GLANCE: CSX Technology Inc.
Company: CSX Technology Inc. is a subsidiary of CSX Corp., a transportation and logistics service provider with headquarters in Jacksonville, Fla.

Problem: The company needed to find a way to interest former IT staffers in coming back to work at CSX.

Solution: “Re-Meet and Greet” cocktail parties give CSX managers and former workers a relaxed environment to discuss “the new CSX” and broach the subject of re-employment.

Such strategies can benefit both sides of the employment equation, say human resources experts. IT managers regain the services of talented staffers who already know the company’s business, and those talented techies return to an organization they know values them highly.

“The fact that CSX was reaching out to me made me feel good,” Worthington agrees. “They were saying, ‘You were valuable to us, and we’d like you back.'”

Retaining IT employees tops the agenda for HR personnel, right up there with attracting fresh talent, says Nathan Ridnouer, head of the Human Resources Forum at the Information Technology Association of America (ITAA), based in Arlington, Va.

“With the job market for IT workers so tight, companies are knocking themselves out to find new and better strategies for locating high-tech talent,” he says.

Patricia Christensen chairs the ITAA’s HR Group, whose members go on retreat three times a year to hash out their thorniest staffing problems.

“This year and last have been especially difficult for finding and keeping talent,” she says. “Our members are finding that the younger staffers-those who have been with a company four or five years-are the quickest to leave. They’re the ones who believe that the grass is greener over the fence. It’s a sticky problem.”

The Boomerang Effect

Portrait Of A Boomerang

Which of your IT staffers is most likely to be eyeing the door? According to David Foote, president of Foote Partners LLC, in New Canaan, Conn., the ones to watch share certain characteristics:

They’ve been with the company five to seven years.
They are working at their second or third job out of college.
They seek technological challenges that the current job doesn’t offer.

…and the candidates most likely to come back

They’ve worked at the company for at least five years.
They left to become independent consultants, but are often unprepared for the challenges of going it alone.

But not insolvable, says John Putzier, president of FirStep Inc., a high-tech human resources consultancy in Prospect, Pa. Putzier has written several articles about how to entice employees back to their former workplaces. He’s even given it a name: “The Boomerang Effect.”

Putzier developed the term after listening to innumerable laments from HR execs about “the revolving door” in IT organizations-people coming to work at a company and then leaving soon after. Putzier believes the solution is to make sure the door makes one more revolution and deposits the employee back inside the company.

“Why not take advantage of the possibility that your ex-employees may want to annul their divorce from you?” Putzier asks. “Boomerang strategies can bring them back.” First, IT managers in charge of hiring need to realize that “when someone leaves, it doesn’t mean he or she is dead,” he says. “You have to find ways to stay in touch, to keep your hooks in them.” Putzier offers several simple boomerang strategies. Among them:

Send former employees a list of job openings.
Put them on the mailing list for press releases that tout how well the company is doing.
Encourage their friends still working for you to keep the lines of communication open.
Invite them to the company picnic or a departmental holiday party.
Remind them that they are missed.

“Remember, these people have egos, just like the rest of us,” Putzier says.

When The Grass Isn’t Greener

What does it take to keep high-tech happy?

A study just released from William M. Mercer Inc., the workforce research firm based in New York, reinforces an old adage: Money can’t buy you love.

Read More

Perhaps the simplest tactic is the one that worked with Greg Hoes: the upbeat exit interview. In August 1998, Hoes, a sales manager at Cyborg Systems Inc., a software developer in Chicago, left the company after seven years to take a higher paying job with SAP AG, the big Walldorf, Germany-based ERP specialist.

“A bunch of my buddies had left to join SAP and they were making a lot more money there than I was here. It seemed like a good thing,” says Hoes. Within weeks, however, Hoes realized that the environment at SAP “just wasn’t me.” He was back at Cyborg within five months. “I was comfortable doing that partly because we’d left each other on such good terms,” Hoes says. “They made it clear in my exit interview that they were sad to see me go.”

Putzier lauds such kid-glove handling of departing employees and recommends an additional tactic. “Why not send out an exit questionnaire to the employees two weeks after they’ve started their new jobs?” he says. “They may be at just the point where it’s dawning on them that what they had with you is better than what they’ve got now.”

Retaining Vs. Rehiring

Many companies acknowledge that strategies like those suggested by Putzier are a good idea, though they have yet to implement them. United Parcel Service of America Inc., for instance, has no formal program for luring back ex-employees. “It’s something we’re studying,” says Ruth Zimmerman, workforce planning specialist at UPS in Mahwah, N.J. Several former IT workers have rejoined UPS in recent years, she adds, “but they generally approach us, rather than the other way around. We evaluate them on a case-by-case basis.”

At other companies, especially those blessed with unusually low turnover rates, the idea of luring back former workers holds little to no appeal. According to Ron Griffin, CIO of Home Depot Inc., headquartered in Atlanta, “We may not even be inclined to pursue people who have left us.”

In addition, some companies claim that devising strategies for rehiring former employees is akin to putting hay in the barn after the horse has bolted. The smarter strategy, these companies claim, is to keep the horse from bolting in the first place. At Southwest Airlines, the IT HR department emphasizes hiring people whose personalities mesh so well with the corporate environment that they don’t want to leave, rather than trying to lure back former employees.

“We do a lot of behavioral interviewing,” says Erica McKay, an information systems recruiter at Southwest in Dallas. “We’re very up-front about our corporate culture. As a result, we don’t have a lot of people who don’t fit in here. So, in the end, we’re keeping the people we want to keep.”

If a Southwest IT worker does leave, McKay says, the reason is probably valid, so concerted efforts to rehire the employee would be wasted energy. Indeed, Southwest boasts a turnover rate in its systems department this year of about 8 %, or 12 to 20 % less than the national average. “I can think of two people who have left and come back,” McKay says. “One relocated to another part of the country, but then moved back. The other left but realized within three months that he’d made a mistake. He came back to us.”

Reunited (And It Feels So Good)

Still, companies like CSX feel the extra effort involved in getting employees like Worthington back is worth it. Not only did the Camden Club party boomerang Worthington back to the company, but three other former IT employees also took advantage of the offer that night, and two more are in the process of returning right now. With a guest list of around 50 former staffers, that’s better than a 10 % success rate, notes Jack Morgan, assistant vice president of human resources at CSX. Rates like that have persuaded the company to try it again: On October 13, CSX will throw another alumni party in Jacksonville.

Strategies For Attracting Back Former Workers
At the exit interview, make it clear to departing employees that they’re welcome to come back at any time. Offer to reinstate benefits to staff who come back within a certain amount of time.

Keep in touch with former staffers. Assign someone in your organization to act as a “linkage person,” sending ex-employees the company newsletter, press releases, even birthday cards. When appropriate, invite former staffers to company or departmental functions, such as holiday parties or summer picnics.
Enlist current employees to stay in touch with their former teammates. Encourage them to promote job openings in the company and to reiterate the company’s invitation to reapply at any time.
Hold “Re-Meet and Greet” parties for company “alumni.” While there, emphasize exciting projects in the works, improved compensation structures, and new opportunities for advancement. Let them know they are missed and the door is open for their return.
Consider offering to reinstate benefits to returning employees at their former levels.

“It’s really not an expensive thing to do, compared to other recruiting options,” says Morgan. “And it’s a way to connect with these people without calling them up at work.”

The company tries to make these parties fun, handing out model trains as door prizes and wine glasses as party favors. CSX managers come prepared to schmooze, but with a low-key attitude. None of the invitees were asked to bring a resume to the Baltimore event-the party was purely for sharing information and reestablishing old contacts.

“I was impressed that several senior managers came up from headquarters in Jacksonville to speak with us,” Worthington says. “They and the local managers discussed the company’s direction, the new and exciting projects going on, and then opened the floor for questions.”

CSX has developed strategies for rehiring along with its extensive employee-retention program. Through an attractive combination of employee benefits, the company has managed to reduce its annual IT employee turnover from roughly 20% in 1997 to 11% this year. Among these benefits are quarterly bonus payouts, instead of annual or semiannual, and an employee-rewards program that awards outstanding employees and managers with perks such as movie tickets, shopping sprees, and cash. The company has created a work and life committee that handles issues such as child and elder care and diversity awareness. Employees also have access to a virtual university that allows them to upgrade their skills for free and at their own pace.

Worthington, an independent consultant for the seven years after leaving CSX, was also impressed by the generous terms of her re-employment. CSX agreed to reinstate her to her former level of service, meaning she didn’t have to wait an additional five years to become vested in the company. She retained her previous amount of vacation, and the company agreed that she could return to CSX and begin part-time work while she wound up her commitments to her own clients.

“Tactics like these aren’t hard [to implement], but they may raise a few eyebrows among traditional-minded human resources managers,” notes Putzier.

Another benefit to expending time and energy in pursuing former employees is increased loyalty among the returnees. According to Putzier, studies by workforce market research firms, such as William M. Mercer Inc., in Louisville, Ky., show that employees who leave and come back are among a company’s most loyal.

“They know what else is out there, and they’ve still chosen to return,” explains Putzier. “To be fair, they also admit they’d be embarrassed to leave again.” //

–Stephanie Wilkinson is a freelance writer based in Lexington, Va. She can be reached at

What does it take to keep high-tech happy?

A study just released from William M. Mercer Inc., the workforce research firm based in New York, reinforces an old adage: Money can’t buy you love.

Love, in this case, refers to IT employees’ affection for their place of employment. In a survey of 1,000 firms, Mercer has discovered that retaining high-tech staff is less a matter of cold, hard cash, and more a matter of offering them “softer” sorts of renumeration. “Effective retention of staff, it turns out, is not related to compensation,” says Eric Schulz, team leader of the data and systems group at Mercer’s Louisville, Ky., facility and coordinator of the new study. “Over and over, we’re hearing companies report that what keeps people loyal has little to do with their paychecks.”

What does keep employees from job-hopping? According to this new study, “Attracting and Retaining High-Tech Talent,” released at the end of September, companies attuned to their workers’ wishes are providing them with such things as a challenging work environment, strong leadership, support for their families, and ongoing training.

Such surveys belie the common belief that you have to pay the most to get and keep the best people, says David Foote, president of Foote Partners LLC, a consulting firm in New Canaan, Conn. “You don’t have to give [IT staffers] 100% of the cash value of their skill to keep them if you offer them the other things they want, like the chance to work with cool technology, praise and recognition for what they do, and maybe a couple of box tickets to the Bulls every once in a while,” says Foote. “This is basic psychology. You have to pay attention to what makes your people happy.”

Employers can’t be blamed for thinking that money matters most, says Foote. “When a techie is unhappy with a job, it often is expressed as a desire for more money,” he says. “That’s the easy thing to say. But research shows that what really keeps people happy in their jobs are lifestyle-related things, such things as the size of their cubicles, the number of windows, and the comfort of their chairs.”

This is not to say that money is unimportant to IT employees. But research by both Mercer and Foote Partners show ,that IT employees prefer innovative compensation packages to traditional salary structures. “Variable pay is popular,” notes Schulz, “especially bonuses-signing bonuses, retention bonuses, and project milestone bonuses.”

“IT people like multiple incentives: stock options, hot-skills premiums, and performance bonuses,” agrees Foote. “You just have to ask them, ‘What kind of rewards do you want?’ The companies that never bother to talk to their staff will lose out in the end.”

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