Peter Cappelli

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 <h4 class="ideainbrief-title">The Idea in Brief</h4>
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 In today’s hypercompetitive markets, it’s open season on other companies’ talent. So how can you ensure that your most valued employees don’t leave? Not by trying to keep everyone forever.
 Long-term, across-the-board employee loyalty isn’t possible—or even desirable—and generic retention efforts no longer work. It’s the market—not your company—that determines the movement of your employees. Your firm may be a great place to work, but you can’t counter the pull of attractive opportunities and aggressive recruiters.
 Instead, use a market-driven approach to retaining talent: Decide which employees you need to retain and for how long. Then influence who leaves and when, using targeted, customized programs.
 The Idea in Practice
 Retention-as-marketing isn’t easy—you need a hard-headed, analytical approach to what may seem like a “soft” side of business. Nor is it a one-time effort—the underlying changes behind the retention war are fundamental. These tips can help:
 Compensation. “Golden handcuffs”—pay-based incentives—are easily matched by outsiders. Use these tactics instead:
 <ul>
 <li>Pay “hot skills” premiums to employees with crucial, rare expertise. This keeps them in place for critical periods—e.g., the late stages of a key product’s design. Stop the premiums when the skills become more available or less important to your business.</li>
 </ul>
 <ul>
 <li>Pay signing bonuses in stages. Associated Communications paid out its new CEO’s $20-million bonus over five years.</li>
 </ul>
 Job Design. To influence which critical people stay for how long, carefully design jobs. Example:&nbsp; 
 Some Wall Street investment firms require junior analysts to leave after three years. Once plagued by these analysts’ erratic turnover, the firms now know who will leave and when, and can design key projects to coincide with analysts’ tenures. 
 Job Customization. Tailor jobs to individuals’ needs using customized employment agreements. These may include part-time schedules, tuition reimbursement, and other opportunities for employees to choose career-development or work/life-balance options.
 Social Ties. Loyalty to companies may be disappearing, but loyalty to colleagues is not. Nurture social ties among key employees whose skills are in high demand. To generate commitment to the work:
 <ul>
 <li>Organize work around projects. This gives employees more control over their work—and strengthens their commitment.</li>
 </ul>
 <ul>
 <li>Assemble teams and use team-based compensation.</li>
 </ul>
 Hiring. In some cases, shift your sights to workers who can do the job but are not in highest demand. Example:&nbsp; 
 Architectural Support Services recruits from community colleges instead of elite, four-year institutions, having learned that hiring only the “best and brightest” spawned infighting and high turnover. A more loyal workforce—with no decline in overall firm performance—resulted. 
 <h2>Adapting to Attrition</h2>
 Despite these strategies, you can’t always keep particular employees. In these cases:
 <ul>
 <li>Adapt your operations to high turnover by standardizing jobs and cross-training workers—e.g., certify machine operators on multiple machines; organize work around short-term projects with clear end points.</li>
 </ul>
 <ul>
 <li>Use information technology to preserve company memory that departees would otherwise remove.</li>
 </ul>
 </div>
</article-ideainbrief>If you’re like most executives today, you’re a poacher. You regularly look outside your organization to find talented individuals to fill key posts. And when you spot attractive candidates, you do what it takes to lure them away from their current employers. You offer big signing bonuses, you buy out stock options, and you provide rich compensation packages of your own. All the while, you know that other companies are busily rifling through your own organization, hoping to poach your best talent.

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A Market-Driven Approach to Retaining Talent

Traditional strategies for employee retention are unsuited to a world where talent runs free. It’s time for some fresh thinking.

A Market-Driven Approach to Retaining Talent

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