In 2008, financial rewards will continue to be the company’s chief weapon in the War for Talent.
Nonetheless, employers’ competition for talent based on compensation is as dreadful as market competition based on price. Undercutting prices can lead to an increase in market share in the short-term; however it can impact the profitability in the long-term. Comparable, companies can successfully lure talent, but may have difficulties to gain their loyalty and commitment over the long haul.
DDI’s Retention Drivers and Employee Commitment Model confirms that monetary incentives have a short life. Employees particularly fall prey to higher financial rewards (tangible elements of EVP) from a competitor, when they feel dissatisfied with the level of leadership, growth opportunities, and culture (intangible elements of EVP) at their current company. Thus, talent can be successfully attracted with EVP tangibles but must be retained with EVP intangibles.
So, to stop this vicious cycle of turnover, companies should design a distinctive EVP and actually walk the corporate talk of “employees are our greatest assets”. Surely this could be a valid Chinese New Year’s Resolution.
A Happy Year of the Rat!
No comments:
Post a Comment