The New Employee: Veering from the Traditional

Employers juggle multiple factors in attracting and retaining talent
by RaeAnne Marsh

CoverStory_1113As businesses have begun ramping back up into a slowly recovering economy, expanding their work force is often a top priority. Filling job positions, however, is turning out to be a challenge as employment has come to encompass myriad aspects of culture, values, training and aspirations.

“It’s gotten much more competitive for the employer to find the most talented employees,” says Grant Dipman, general manager of the Ritz-Carlton Phoenix. To find the right fit for the organization, he says, Ritz-Carlton changed its hiring process about two years ago to look beyond work experience and try to ascertain talent in finding the right fit for the organization. For Ritz-Carlton, it’s a “strong customer service focus no matter what part of the hotel” the person will work in, Dipman explains.

But not all businesses are as clear about what they’re looking for. And that, says Susan Williams, founder and CEO of human resources firm HR Choice, is why many companies are finding hiring to be very difficult. “Employers advertise a job and get an overwhelming number of applicants,” she says. “The clearer the employer is in what he’s looking for in a candidate, the easier it is to screen and do a better match.” In many cases, the small and midsize companies do not have the HR infrastructure — such as job descriptions and screening and hiring processes. This was not a problem in the past, when there were fewer applicants; now, there could be a hundred or more resumes to go through. And, Williams notes, this situation is the same for all positions — management, hourly or trade.

If a new hire is not a good match for the job, he or she is likely to leave within the first year. Companies, therefore, need to make it more of a priority to create appropriate recruiting and hiring practices, and not, as Williams says, “just hire to hire.”

Angelo Kinicki, who teaches in the Management Department at ASU’s W. P. Carey School of Business and is known for his expertise in leadership and employee response to organizational change, observes, “Managers and employers can’t do the same old thing they’ve been doing.” Instead of just looking at hiring from the standpoint of their own needs, they need to look at the needs and values of the employees they want to attract, and “offer what’s important to them.” And he notes, “It’s a tougher task than existed in the past.

Match to Workplace Culture

The concept of “culture” has become accepted as a concern for employers, who no longer offer just a job but create a workplace environment. Companies even vie for “Best Place to Work” awards.

The Baby Boomer generation that has begun to retire from the work force is taking with it values based on a more hierarchical view of the work place, with an expectation of staying with a company over the long-term and feeling that the work they produce for the company speaks for itself. With the Millennials, retention is a continuous effort and, in terms of work product, they want to feel they offer a unique skill set. “They need to have that [affirmation] communicated to them,” says Kirsten Hall, workforce project manager with the Arizona Commerce Authority.

Recognizing that different generations have different expectations complicates the recruiting and hiring process, Williams observes. She finds younger generations place more importance on opportunities to grow and “will do more interviewing of the employer than other generations.” Once hired, Gen X and Millennial employees are more likely than their older counterparts to move on if they find the job not stimulating or interesting enough or the work environment too bureaucratic.

The more progressive work environments recognize the importance younger employees place on being involved in projects that are meaningful to them. And they are also facing challenges to basic management policies as different norms come into play. Social media is one such area. Explains Kinicki, “If a company outlaws Facebook at work, that would be OK with a Baby Boomer, who’s used to walking down the hall to have a conversation. But a 27-year-old has grown up with it; [for that generation], it’s part of who they are.”

Culture is also about communication. “It’s important to have a culture of clear and transparent communication, both upward and downward,” Hall says, explaining this impacts retention because employees then feel the employer is open to a conversation if their needs change.

And then there’s work-life balance, which companies foster in different ways. At the Ritz-Carlton, employees will work longer hours when occupancy is high, but the company makes up for that during slower times. Citing employees as the company’s most important resource, Dipman says, “As a company, we’ve learned the value of employees having that balance and the opportunity for vacations.”

The quality of the managers and supervisors in an organization is another factor in retaining talent, although Williams points out this has long been true. “The largest percentage of those leaving, do so because they didn’t like the manager or supervisor they worked for.” Pay is usually not the issue, she emphasizes; respect is — and this is true no matter the age of the employee. In fact, the concern for a stable culture may be even stronger in the more mature employee, says Todd Govig, president and CEO of executive search firm Govig & Associates, who relates he has seen supervisors actually throw chairs.

Jessica Corral, partner with recruitment firm Headfarmer in Phoenix, says she finds now that “companies are seeing the need to strengthen the management team, to create a more stable environment that offers the opportunity for growth.”

Benefits Matter

While career path and making a difference are more important to the younger employees than are benefits, benefits still stand among the top three items candidates look at when making their employment decisions — especially medical insurance.

Some companies are looking at a different way of providing healthcare insurance, says Williams, who is seeing a trend — especially among smaller businesses — of using the healthcare exchange for more affordable healthcare. “They offer to make a contribution toward the cost, but don’t offer a [company] healthcare plan.”

Retirement plans are another important benefit. The popular 401(k) has recently been in the news over issues of high fees and poor fiduciary management, but several companies in Phoenix take a different path to providing for their employees’ future. Wilson Electric and McCarthy Building Companies are two businesses that have an employee stock ownership plan (ESOP), in which employees share ownership interest in the company.

“The ESOP is very important in recruiting and hiring quality people,” says Wilson Electric president Wes McClure, noting that as things pick up, qualified employees are harder to find. “Employees understand they are owners and reap the reward of what they contribute” in ideas or productivity to further the company. He believes that success comes from everyone working together and that the ESOP helps in getting everyone on the same page.

Bo Calbert, president of McCarthy Building Companies, puts it succinctly, “Employee ownership has played a big factor in our performance.” He’s found, however, that recent college graduates value money in their pocket today over future planning. “They don’t see themselves 30 years ahead,” he says, “but after they’ve been here five years, they start seeing the value.”

McClure sees the attitude difference related more to age than generation. “As people get older, they look more at retirement.” But he feels it’s “what the guys in the field are looking for and how I feel they are happiest and most productive,” he says. “You have to have the mindset that you want the employees to share in the success.”

Flex time — enabling people to have flexibility about how they manage their work life — is another benefit that seems to span the generations. “For Baby Boomers, that could mean dealing with eldercare and grandkids; for younger people, possibly sleeping in and working later,” Kinicki explains.

Another approach to benefits has recently been reported: Facebook is planning to build an apartment complex adjacent to its offices in the Bay Area. While the idea is, giving employees a great price on their rent will “make people really want to work there,” Kinicki notes it also means their time is not lost in commuting and they can work more hours. “Of course,” he points out, “there are not many companies that can do this.”

A Growing Remote Work Force

There’s a growing interest in a remote work force, which Kinicki attributes to the increased use of information technology in the way much of the work is done today. According to Greg Waddington, Phoenix area director with Regus, fully two-thirds of Phoenix professionals manage someone who works remotely, and an even higher percentage of Phoenix businesspeople (77 percent) believe managing at a distance has advantages and is a growing trend — and 86 percent think it helps in staff retention. This includes letting employees work from home and the sharing of temporary work spaces. “If you have 15 percent of your work force work from home one or two days a week, think of the cost savings,” Kinicki says. Another rationale is part of Regus’s strategy in providing what it terms “flexible work space” — providing locations that give businesspeople a convenient place away from a centralized office if they are out in the field and have several hours in between appointments.

Waddington acknowledges there are concerns about how to manage a remote work force, and there is no universal agreement. Williams notes that while a remote work option can make sense in certain jobs — and a business may be able to hire someone who might not be available otherwise — it’s important to evaluate the maturity and commitment of the employee.

Williams does not believe that the opportunity to work remotely makes a lot of difference in recruiting. “Most people want to feel part of a team.” Kinicki suggests a company consider the strategy to work remotely at the time of hiring rather than later, observing the attractiveness of it is “more of a personality characteristic than related to a person’s age.”

Loyalty Is Not Lost

“Articles say loyalty is gone in corporate America, but what I see is, it’s rare to hear employees say they plan to move on in five years; they want to be where they can stay a long time and make a difference — almost without exception,” says Govig, who has worked with several generations over his 26 years in the recruitment industry and whose own company, Govig & Associates, has kept many of its recruiters for 10 to 15 years. He finds the new generation to be diligent, hard-working and bright, although they may be naïve about pay and promotion at first blush out of college. They want to grow and add to the organization, providing leadership even if they are not in a formal leadership role. Reiterating a common theme among those interviewed for this article, Govig says money is not the main motivator keeping people at a job. “People want to work at a place they can be proud of; that’s fun; where they are challenged, and rewarded appropriately.” This characteristic, often applied to the younger generations, “is drifting into the older groups,” he says.

When a company builds a relationship with the employee, that lays the foundation for loyalty. A big part of this is the employee’s sense that his or her contribution makes a difference, a validation that can come from the employer, co-workers or customers.

There is a flip side to this that Headfarmer’s Corral points out. Companies often seek to hire employees who show the stability of having been with an employer for at least five years — but view a lengthy tenure as a shortcoming. “If they’ve been at a company too long, they’re seen as not able to adapt to change; they only know one company’s way of doing things.”

Dipman stresses that the opportunity Ritz-Carlton offers individuals to go from entry-level to senior positions within the company — of which his own rise is an example — is a stronger draw to new college graduates. “They’re excited about working for a company they can have a career with and that genuinely cares about your growth,” he says, noting Ritz-Carlton not only empowers employees to make decisions to take care of guests but gives them the opportunity to be involved in planning of work that affects their job.

Training? Yes and No.

At Ritz-Carlton, training is part of the opportunity for growth as it gives employees a chance to experience other aspects of the hotel’s operations. “They may start in rooms, then help in banquet and find they really enjoy food and beverage,” Dipman says.

Training programs are important in engaging the employee, says Frank Armendariz, regional vice president of Manpower, a staffing company. They help younger employees, especially — who do not have years of experience — to be successful, which is a factor in retention. However, companies may choose to go after more seasoned employees at a higher pay rate — and have the expectation that the employee already has the skill set. He has also noticed a trend of employers looking for employees that have multiple talents — to shrink training time.

In many cases, formal training is not so important in today’s world, unless a company has its own specific way of doing things. “Information is so readily available due to technology, many companies have the expectation that employees will go out and access the information,” Corral says.

A high growth area now is temporary work or project consulting. Explains Ben Howard, co-CEO of recruiting firm VincentBenjamin, “A lot of companies scaled back so significantly they are now evaluating how aggressive they need to be in the competition for talent, and are focusing on ‘just in time’ employment” — what they need to get the job done now. Employees may take advantage of the flexibility this gives them to target the specific skills they enjoy and a higher-pay engagement than they could get through traditional avenues. Employers coming back after such a severe scale-back, on the other hand, are trying to fill multiple needs with one head count rather than evaluating the skill sets necessary for each function.

However, while companies are hiring based on the ability to ramp up right away, Hall says employers are also complaining that soft skills are lacking — from team building and communication and problem solving to just coming in on time.

And while employers are not as open now to taking on newer, less experienced talent, Howard points out that technology is so fluid that, in certain skill sets, recent graduates may have all the experience and knowledge there is to have.

Where Is the Work Force? 

A large pool of unemployed workers does not translate to a large pool of available talent. The knowledge worker is becoming more important, and so also are specific trade skills. SRP, for instance, is concerned about finding people for lineman work. And manufacturing companies moving here may find a work force that is not as well-trained technically as it is used to. Arizona is a right-to-work state, Hall points out, unlike the East Coast and Midwest, where unions are strong. “And the union does a fantastic job of training.”

“Private industry is partnering with education to increase the pipeline,” says Patricia Wallace, assistant director for workforce development with Maricopa Workforce Connections. This, in fact, is one of many areas where MWC is helping them work toward solutions. “We work with the business to get an understanding of what it is looking for, then contact the community college — which either already has a program or has the capacity to create one — and determine the best resources and how to access and use them,” she says. The focus is on looking at trends so as to create a solution that has broad application in related or even diverse industries, such as a curriculum MWC recently helped design to aid a bottling company and other advanced manufacturing companies that has been of help in logistics for a furniture company and pest control.

“Some skills are translatable from one industry to another,” says Howard, observing that employers may be open to considering applicants from other industries depending on what the function is. And Armendariz notes that companies need to diversify their recruitment strategy if they are looking for specific talent that can make an immediate impact, based on both skill set and the ability to integrate into the workplace culture immediately. They may need to be open to untapped talent as well as recent college graduates and veterans.

With a thin pipeline, companies sometimes attempt to recruit from fellow companies — after all, it’s a stable work force. Dipman says Ritz-Carlton encourages its guest relations/concierge team to attend concierge functions in different cities and develop relationships with others in the industry — and get in touch with them when the company has an opening. This “relationship recruiting,” he says, has been successful.

Another of Ritz-Carlton’s strategies is to go to trade and technical schools. “Our executive chef is an invited speaker at culinary schools,” says Dipman, explaining this enables Ritz-Carlton to create relationships and look for potential candidates to recruit in the future.

Filling workforce needs, Dipman says, “We need to look far ahead.”

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