Tech talent is scarce — here’s how to beat the competition (Part Four – Retention)
Ditch the ping pong table — here’s what matters
The fourth article in our series examines perhaps the most important component of the quadrangle. Too often, we see companies work so hard at recruiting talent, they forget how important it is to retain that talent. Retention is crucial for raising the morale, cohesion and confidence of your workforce. It’s important for your employer brand to attract new talent and it saves you a fortune in hiring costs. In short, you need to give the same effort to retaining your employees as you do to hiring them. But how?
1 — Get onboard
Let’s start at the start — the onboarding process. First impressions matter and onboarding is the process through which new employees receive the necessary know-how to be effective members of their new team. Note that it is here referred to as a process; onboarding is not a one-off first-day initiation.
Effective onboarding can increase employee retention by as much as 69%, productivity by 50%, and engagement by 56% (various sources state even higher figures; ours are sourced from The Society for HR Management).
As is evident from the above figures, investment in effective onboarding processes can yield impressive returns.
If you don’t have an onboarding process in place, create one. It need not be highly formal; new hires understand why startups lack the elaborate onboarding procedures expected from corporates. Draw up a plan of action for your new hire; consider what they need to have and know, and who they need to meet to work effectively. Look to companies at a similar stage for inspiration, survey existing employees about onboarding pain points, do your research and consult experts in your network (investors, HR professionals and recruiters have experience in this area).
2 — Embrace the role of HR
HR is also usually one of the later hires in the startup lifecycle. This makes sense; you need to build your team of ‘human resources’ before they can be managed by HR. But this doesn’t mean HR duties can be ignored. They will have to be delegated between members of the team. The burden usually falls on the founder(s). It’s important not to neglect HR even if there’s no full-time person responsible for it yet, and each hiring manager must keep in mind their HR duties at all times.
3 — Be a culture vulture
For a term thrown around so extensively, company culture is frustratingly difficult to pin down in a single definition. Essentially, your company’s culture is its unique personality. This encapsulates everything from your office environment to your mission and values.
There’s a stereotype that pervades the hive mind about startup working culture, encouraged by the likes of Facebook and Twitter; beer fridges, ping pong tables, slides and hammocks dotted around the office; laundry services and sleep pods available so you never have to leave! Fear not: these things are not necessary for employee retention. Indeed, the recent backlash against startup culture that encourages ‘never leaving’ reveals that such practices are on the out.
If you’re struggling to define your culture, your mission and values are a good place to start. For the quintessential example, see Google’s ‘Philosophy’: the company’s multi-award-winning culture is built around 10 pillars, encompassing quirks such as the company’s user focus, perfectionism, flexibility and moral stance.
Think about what makes your company unique. Is it your flexible hours? Your meritocratic approach? Your flat structure? Any of these things could be considered aspects of your culture. Be careful to maintain a positive culture; news of a toxic culture travels fast (see part one), often heralding a mass exodus of employees and making it nigh-impossible to hire.
4— Illuminate the pathway to progression
Our society is obsessed with progress. The bodybuilder attends the gym with the intent to progress by gaining muscle mass. Similarly, the employee works with the desire to not only provide for themselves (always nice!) but also to progress in their abilities and remit.
Career paths tend to follow a linear trajectory in corporate environments — analyst to associate, associate to consultant, ad infinitum. The same certainty is difficult to mimic in startups; needless to say, the hierarchy of a team of 12 will differ significantly from that of a team of 12,000. See this as an opportunity rather than a hindrance. Where employees in large corporate machines often report feeling like cogs, working in a startup offers the flexibility to carve your own path and potentially progress at a much faster pace, bypassing rigid hierarchies.
Check in with your team at regular intervals to reflect on their progression. If they are performing exceptionally, reward them. If they are stalling, investigate; they are likely as frustrated about this as you.
5— Prepare for impact
As aforementioned, one of the greatest appeals of working for a startup is the opportunity for one’s work to have a palpable impact. This is particularly true for engineers — often relegated to back office in larger organisations, working for a tech startup gives them a front and centre position. It is thus important to emphasise the impact that their hard work is having on the company, whether it be through shoutouts in company presentations or by offering progression.
6 — Authorise Autonomy
In Stackoverflow’s Annual Developer Survey, the ‘work’ section details the job priorities of over 90,000 engineers. The top ranked overall was Languages, Frameworks and Technology, the third a Flexible Schedule, the fifth opportunities for Remote Work. Any other controllable factors we have already mentioned.
What links each of these three priorities is that developers express a desire for autonomy at work, whether it be in the technology they work with, where they work, or the times at which they work. Giving them a reasonable degree of autonomy is thus crucial for retention. If you’re concerned about team cohesion with remote working, consider instituting face-time rules such as a minimum of three days per week spent in the office. Of course, all autonomy should be exercised with the backing of strong leadership — you don’t want your tech team running amok with new frameworks that lack relevance to your product.
7 — Pay on par
While shiny titles and new skills are great, everybody wants to be paid in a manner that befits their level of ability, at least equivalent to what they would be paid elsewhere.
You know from the other articles in this series that the tech talent market moves fast. What was ‘on-market’ pay a year ago could be underpayment today. Listed businesses have remuneration committees in place to benchmark salaries and ensure that their employees’ pay is on-market. Startups lack these. It is always useful to do secondary research, however the data available varies widely depending on its source.
The best source may actually be your recruitment partner — a job that keeps you in constant contact with tech talent of varying seniority is a fantastic way to get an insight into remuneration! Your wider network is also useful to this end — think fellow startups, investors and peers.
Retention is the long-term end of all your recruitment efforts.
Without retention, you risk being stuck in an endless cycle of recruitment with diminishing returns, to the detriment of growth, reputation and morale. Think not only of what value a given employee can add to your business but also of what value you can add to said employee’s work experience.