How to Retain Your Top Tech Talent

Problem – Why Tech Talent Leaves

This LinkedIn study of tech talent found that the main reason an employee leaves an organization and the primary reason they join an organization are the same: career opportunity. While 45% quit because of lack of opportunity, 59% joined a company because of career opportunities there. Pluralinsight captures the essence of this research in a brief infographic.

• 45% say they were concerned about lack of opportunities for advancement
• 41% were unsatisfied with leadership of senior management
• 36% were unsatisfied with work environment / culture
• 36% wanted more challenging work
• 34% were unsatisfied with compensation/ benefits
• 32% were unsatisfied with rewards / recognition for their contribution

Impact – How This Affects Your Company

According to the LinkedIn research, employees are 12 times more likely to leave the company or even higher (30 times more likely) if they are new to the organization. What are the implications for lack of opportunities for advancement? The financial cost to replace one employee is 50-60% of their annual salary, although the total cost of turnover is even higher at between 90-200%. They estimate the average sunk cost of a new hire developer is somewhere between $4,535 and $41,111. There are cultural costs too with reduced productivity, higher stress and lower engagement as well as the loss of institutional knowledge.  

Strategies – Ways to Retain Tech Talent

In this blog that references the LinkedIn study, four ways to show you care about your employees’ career development are highlighted:

• Provide learning opportunities that help careers take off
• Make work meaningful (with purpose)
• Employ managers committed to helping employees grow
• Develop a culture that advances employees from within

Career development is the number one benefit that top tech employees look for in a company. To retain your best employees, offer them career development opportunities. Find out what they want to learn or accomplish within the company. Give them lots of hands-on tasks, access to learning platforms, and provide them with feedback so they know how to improve their performance.

It is likely that your tech employees already have decent pay. The younger generations care more about working for a company that has a purpose with meaningful impact on society. If you want to retain your top employees, consider letting them work with products and services that line up with their core values and that have a purpose.

Two thirds of millennials believe it is the manager’s job to encourage growth and provide development opportunities. This why it is important to hire managers that are good leaders and who will be committed to helping their employees grow. Employees will feel like they have someone leading them that really cares about their career development and will be more likely to perform better.

According to this blog, research from Jacobs, et al. at McKinsey shows how valuable it can be to promote your top coders into superstar maker roles, and not managers who are burdened with checking the work of other people. This is an alternative approach to the typical advancing within to a manager role. Management leaves top engineers little time for what they do best such as writing code and problem-solving.

In this white paper by PluralInsight, they point to the importance of building an environment that fosters loyalty and growth to retain tech staff with these five key areas of focus:

• Work Environment
• Education
• Hardware / software program purchasing
• Perks of hard work
• Recognition

Education is obvious but the rest are incremental to the LinkedIn study.

“The environment, as a whole, needs to not only be conducive to efficient work, but to teamwork and trust.”

A quality work environment is not just limited to physical factors like workspace but include emotional and psychological factors as well. One of the biggest problems that plagues technology employees is burn out. That can easily lead to over-stressed workers who finally leave when they have had enough. Often, “after-hour work binges” can be offset by simply hiring another staff member.

At the end of the year, many companies offer employees a standard “cost of living” increase and some add bonuses (often based on productivity or merit). Others have non-standard perks like extra vacation, titles, telecommuting and shortened work weeks. Offering some of these additional rewards allows you to give employee incentives year-round. The combination of the two could be a strong incentive for your staff to remain on board.

Purchasing programs for hardware, software or other items at a discount is a great way to show your dedication to your staff who represent geeks of all kinds. If you already have purchasing set up directly through major vendors (Dell, Lenovo, Microsoft, AT&T) contact them to find out if they will extend to employee purchasing. 

The pat on the back that recognition offers ensures your employees know you see and value everything they do. Just sending an employee an email or leaving a voice message is not enough. Depending on the person and how they react to attention, consider making recognition public. Send out a company-wide email or make announcements of achievements at company meetings.

“When your staff understands the extent at which you are willing to go to keep them around, they will repay you with hard work and loyalty.

Real Examples – What Some Companies are Doing

It’s not just about strategy but taking real action. Former LinkedIn IT head Craig Williams says talent is more than hiring great people, it means keeping them inspired and engaged by helping them reach their career goals. LinkedIn does this with written career development plans focused on employee passions. They ask their employees to identify two skills they want to get better at such as a programming language or specific soft skill. Then they provide the training through their “Top 2 program”. A Job Shadowing program provides hands-on-experience beyond the employee’s day-to-day job to give them skills they need to make a career transition. For example, to help their IT employees move into network engineering.

In this Deloitte article, Lynden Tennison, the former CIO and chief strategy officer for Union Pacific suggests creating a distinct career path for employees to be able to grow to very senior levels technically without jumping into management. They instituted a technical career path that extends all the way to the executive level. They also created a recognition honor for senior tech professionals called the Union Pacific Distinguished Technologist designation. Candidates were sponsored and voted in by peers. Once accepted, they became members of the company’s Distinguished Technologist Group.

“Everybody knew who they were,” Tennison says. They became our steering committee for technical decisions being made in the company.”

Artur Meyster, CTO of Career Karma in this post reminds us that the younger generations like to change employers, and this is even more so for tech professionals. He recommends listening to your top talent in one-to -one meetings to find out what they want so you can help them in their journey. Finally, go a step beyond and ask them under what circumstances they would consider leaving to join another company. You might be surprised at the answers.

Unique Solutions – Novel Approaches

In this MIT Sloan article, McKinsey consultant Peter Jacobs et.al helps answer this question “How do you identify which talent in your technology teams create the most value for your business?” He says it’s about creating an IT model fit for the digital age that starts with evaluating program competence.

“Researchers at one leading organization found that a single expert is as productive as eight novices.”

One strategy is to build an “Engineer-First” capability which includes three key critical steps:

• Build your organization around the best engineers
• Unburden your top people
• Create a culture that nurtures engineering talent

If you are not a Silicon Valley giant, you might struggle to recruit only top engineers. Instead, you can focus on strengthening your competent engineers. In the diamond model below, about half of the IT workforce includes capable engineers with 20% proficient, 10% expert, 12.5% advanced beginner and another 7.5% novice. According to research, this top-heavy model has an average productivity of 4.73 novice equivalents and needs only about half as many engineers as the bottom-heavy pyramid model to achieve the same output.

Unburdening your top people is about freeing them from managing novice engineers. In the pyramid model with fewer competent and above engineers, there is little time for doing their best work – coding and problem solving.  

How do you create a culture that nurtures engineering talent? One way is to define and reward great performance by setting clear and consistent criteria for skills and behaviors necessary to reach the next level of salary. Then, review performance comprehensively and regularly using a tool for assessing professional maturity. This could entail having engineers rank themselves on a scale from novice to expert twice per year.

What is the definition of a novice versus an expert engineer? Novices are new in their role, usually assigned simple coding tasks and need continual guidance. Often, they have limited technical knowledge and must take basic IT courses to equip them. In contrast, experts have deep experience and can recognize patterns and work problems our intuitively. They may also speak at conferences, write books and articles, and are recognized in their field.

“Although building an engineering culture takes time, the secret to achieving success lies in treating IT engineering as the craft it is and understanding what quality looks like.”

Skills – Most Critical

According to this Harvard Business Review (HBR) article, “The most critical skill for IT in the decade ahead will be the ability to constantly learn and adapt,” says George Westerman, a senior lecturer at MIT Sloan School of Management, principal research scientist for Workforce Learning at the MIT Jameel World Education Laboratory (J-WEL), and author of Leading Digital.

“Technical people need to keep up with constantly changing tools and technologies. But everyone needs to be able to adapt to changes in their work and, in the longer term, to reskill and pivot to new roles over the course of their careers.”

What are some critical skills for 2021 and beyond identified by HBR?

In the 2020 IT Salary Survey by Information Week, they found IT professionals still favored technology specific training (68%) when asked about the most valuable training. Certification courses came in second at 41%. The importance varied based upon age of the workers. Those in the 44 and under range were more likely to find certification courses valuable in developing their careers (49%) versus workers of 45 and above (38%).

The skills that IT pros planned to learn aligned with those that they believe will benefit their individual advancement and salaries. The top three ranked skills for advancing careers and salaries were IT security (37%), cloud integration/management (29%), and leadership skills (28%). In the past, only a small portion of IT needed to have soft skills often associated with leadership. Today they are critical throughout the IT organization. Ken LeBlanc, partner at CIO Sensai, an IT advisory firms says:

“You need to collaborate and communicate within and across the IT organization itself. You need to be able to negotiate, be flexible, understand one another, have empathy, and be able to recognize your blind spots.”

Melissa Swift, a leader for digital advisory at Korn Ferry, sees empathy as the key ingredient:

“As work gets more automated and more procedural work is done by technology, what you need from your human workers—and particularly your human leaders—is greater empathy. If you can really understand your end user, it gives you an edge.”

All the IT leaders interviewed for the HBR report highlighted the need for their teams to be effective verbal, written, and visual communicators. DBS Bank brought in the co-founder of an Oscar-nominated visual effects company to teach 200 key technology and operations leaders how to how to tell a great story and present a business case in a more succinct way. Fifty of the best stories were showcased in a book.

CIOs also talk about the need for their teams to be great collaborators, consultants, and coaches, and to network effectively. Memorial Sloan’s Jensen calls these “durable” skills. He helped his team at a prior company develop them by devoting 100% of his training budget to the effort.

These are “the aspects of the job that aren’t changing next year or the year after,” he says.

How do you create a culture that nurtures engineering talent? One way is to define and reward great performance by setting clear and consistent criteria for skills and behaviors necessary to reach the next level of salary. Then, review performance comprehensively and regularly using a tool for assessing professional maturity. This could entail having engineers rank themselves on a scale from novice to expert twice per year.

What is the definition of a novice versus an expert engineer? Novices are new in their role, usually assigned simple coding tasks and need continual guidance. Often, they have limited technical knowledge and must take basic IT courses to equip them. In contrast, experts have deep experience and can recognize patterns and work problems our intuitively. They may also speak at conferences, write books and articles, and are recognized in their field.

“Although building an engineering culture takes time, the secret to achieving success lies in treating IT engineering as the craft it is and understanding what quality looks like.”

Summary

Regardless of your model for tech talent retention, make sure there is real leadership buy-in for commitments to ongoing investments in technology, training, and whatever other resources your IT team needs. Sreeni Kutam, chief human resources officer at ADP says for companies that can afford to make that commitment, the ROI is there according to this blog.

“Investing in employees’ career development can mean big payoffs for organizations. Employees who feel supported and empowered to pursue their career goals are more likely to stay where they can build their skill sets and potentially lead the organization in the future.”