Spacious open-plan offices in luxurious buildings with excellent urban location, great remuneration, accompanied by attractive social packages, strict law-abiding policy, generous budget on frequent, modern and fun HR activities and trainings for all employees, friendly and supportive managerial staff and yet… you still experience striking turnover and 30 % of your incredibly talented and valuable IT staff intends to leave the company soon. Don’t have an idea what you are doing wrong? Read on:
1) Leadership style and organizational culture
When working with people operating with abstract knowledge (which tend to be craving for autonomy, are expected to be creative and extremely focused on their intellectual performance) theory and research recommend that you use democratic leaderhip/management style (perfectly matching the expected of an IT company organic organizational structure) – not too soft, neither too demanding. Practice shows that Laissez-faire and autocratic leadership styles prove to be ineffective in the IT sector and are a great way to crash a company operating in this field.
As for the organizational culture, the best choices for organizational culture (according to research and extensive experience) in the creative and innovative businesses in the Information Technology sector are the clan and the adhocracy cultures with the first focusing on commitment, communication and development, and the second placing the emphasis on innovative outputs, transformation, agility. Leaders in the clan culture are seen and should keep a consistent image as facilitators, mentors, team builders, while in the adhocracy organizational culture they present themselves and are perceived as innovator, entrepreneur, visionary. Market and hierarchy culture are typically not working well in the IT sector. It is also crucial that the organizational culture matches the company’s mission and values, as well as the strategy, structure and the leadership style.
2) Remuneration vs non-financial rewards ratio
The information technology sector is fast-paced, demanding more talent and professionals in this field usually know their price. You should keep in mind that people generally work for money (professional relations are not the intimate ones based on feelings and loyalty, the sad truth in business is that we have a very practical workforce who want to sell their qualifications, knowledge, time and abilities for money), and this is especially true in the IT field and in the developing economies. People will love to receive as much money as they can for their efforts, just as you will appreciate to take up as much projects as you can. Because money matters. Remember – in this business non-financial rewards are just a bonus and nothing more than that.
3) Expectations and psychological contract
Professional relations are not intimate ones – your employees work for money and if in the course of your work together you expect loyalty (and they worked happily ever after…) and self-denial, your expectations will be probably disconfirmed and the psychological contract will be violated from both sides (higher expectations from your point of view, unachievable goals, low rewards and perceived pressure from the employee perspective). Which may ultimately lead to the termination of the professional relationship and cooperation. Try to avoid it by inspecting closely the individual motivator for every employee early in the recruitment and selection process. And yet – accept the fact that some of your employees will inevitably leave.
4) Workload vs. workforce
OK, we know that you are passionate for challenging projects and would love to expand your business, but workload should be bearable for your employees. Avoiding employment costs is tempting but ineffective in the long run. Fine measurement of the possible individual productivity as compared to the actual workload is essential for your company’s effectiveness.
5) Career planning and talent management
It is true that the IT field is constantly changing and the upcoming projects rarely can be predicted – it is essentially a sector of perpetual innovations which demands that the staff working in it manages to keep pace with its rapid evolution while at the same time we never know which competences, skills and abilities will be useful in our challenging projects in the future. However, it is highly recommended that the IT management do their best to plan the career growth of each of their employees, preferrably from the very beginning of their collaboration. Having a clear plan of what the company has to offer to you makes you feel appreciated and valued, so be giving to your staff and take the time to make a career development plan for every staff member. When you can’t really offer a promotion or a higher position in the company’s hierarchy, you can always focus on and provide continuous training and education in hard and soft skills to your employees.
6) Public communication
Spending a fortune on employer branding and maintaining an attractive profile of your company in the social media are useless, because your overall public appearance is what matters. That means that the appearance and activities in the digital and print media of your company, presented by your employees, should be spotless. You are expected to say no to the visible friendly chats in LinkedIn & Facebook, to the personal fun posts, to the explanatory posts in the websites rating your company, everything you and your people write and expose to the wider public (including their personal websites and accessible content in the social networks) should be compact, professional and fact-proven. Because even unnoticeable details may ruin the whole image.
7) National culture and generation gaps
You can’t avoid the national culture traits reflected in every member of your typically multicultural IT team – it is widely accepted and observed in practice that Eastern societies tend to be collectivistic (i.e. giving priority to a group priority over each individual in it) as compared to the Western, which express a generally individualistic worldview (i.e. value personal achievements, show ambition for growth and are less connected to the people around them). The national culture imprinted in every member of a society is extremely difficult to change, so get to know the cultural differences and be realistic – you can’t expect from a Bulgarian, for example, to express traits of a collectivistic culture and from an Indian to behave in an individualistic manner.
Generation gaps are challenging as well. The millennials invading the workforce now tend to be impatient but also creative and over-connected – you are not supposed to expect them to change, all you can do is adapt to their viewpoint, beliefs and values and make them work for your company.
8) HRM practices and activities
Most companies in the hectic IT business these days strive to keep up with good practices in HRM and tend to compete with their rivals furiously in this aspect – they try to involve in modern, frequent and fun HRM activities and spend thousands of dollars on team building, training and development of their staff. However, these efforts usually are futile. The first reason is that the typical IT worker has a very specific psychological profile, especially the software developers – they are strict, focused, tend to love working alone and in relative autonomy and sometimes they perceive the HRM practices as “a waste of time”. And you should bear in mind that participation in HRM activities is supposed to be a choice and not an obligation of any sort. Second reason – implementation of HRM practices should be very structured and well-planned. Chaotic HRM practices, just to show that we care for our employees like our competitors do, to expose our managerial creativity and extraordinarity are useless and mean money and time spent for nothing. HRM practices and activities should be included in a very precise long-term HRM strategy, realised by yearly plans for practices and activities.
9) Work enrichment
It is very common for employees in exit interviews to share that the work in their position has become routine very quickly or the employees say that they leave because they feel they have reached the maximum knowledge and competences in this role but they want to go beyond and develop. Use job rotations and enrichment as much as possible, empower your employees, let them participate in the management process to an adequate extent, because your people want to have their voices heard.
10) External consultant
Use the services of an external consultant at least once annualy. Prepere for a precise and objective diagnosis of the state and actual problems in fields such as: employee relations and communication, motivation and engagement, leadership/management style, employer branding, HRM function budgeting, recruitment and selection process and procedures, compensation and benefits systems, employee training and development, workplace safety and that’s not all. We are sure that you have hired the best professionals in the Human Resources Management in the area but they are still your employees and are likely to be striving more to get their salary at the end of the month than to face you with the bitter truth about your management.
© Silvia Davidova-Ivanova, 2018