The Great Resignation and how to avoid it - two tech firms offer up their tips on staff retention

By Cath Everett

March 16, 2022

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Although the so-called ‘Great Resignation’ may be a much more problematic phenomenon in the US than elsewhere in the world, it has raised the important, but previously all too often neglected, question of how employers, wherever they are based, can best retain talent.

According to Andy Brown, Chief Executive of leadership and engagement consultancy Engage, the pandemic encouraged people across all industries to re-evaluate their life and work. But the sectors most affected have been low-wage ones, such as retail and fast food and, at the opposite end of the spectrum, tech. One of the results in the tech sector specifically has been increasing calls for more flexible ways of working. Brown explains:

There’s almost a vicious circle going on because many companies had good flexible working policies pre-pandemic. Due to a general rise in flexible working across the board though, expectations have now risen and people are looking around for the best deal.

Another widespread challenge is that due to the pandemic-related boost in demand for tech and digital expertise, ongoing skills shortages have got even worse. This means it is now more of a sellers’ market than ever, which gives workers the ability to pick and choose. But the problem is that many employers have responded to the problem in a “very basic way”, says Brown:

It’s a classic HR thing to throw money at people, and it’s too tempting not to do so when others are doing it too. But we know from our data, it’s a very short-term fix. Pay is a pulling factor, but it’s not a big influencer on whether people stay or not. In fact, when we looked at the top five drivers of employee retention, reward is way down.

Instead it is cultural issues that have the biggest role to play here. In a tech context, the single most significant factor in encouraging employees to stay is providing them with growth and development opportunities. Doing so makes them 9.4 times more likely to remain in post.

Having an inspirational company purpose and values comes in second, making retention 7.8 times more probable, while empowering employees to make their own decisions is six times more effective. Clear communication and enabling collaboration, followed by sound leadership and direction, also make staff 4.1 times and 3.2 times less likely to leave respectively.

Going for the win-wins

Dan Faraday-Foster, Founder and Managing Director of UK-based cloud and DevOps consultancy Steamhaus, is an avid believer that organizational culture is vital to keeping staff on board. Key considerations here, he says, are “treating people like adults” and letting them see that “what you say is authentic”:

I started my first company when I was 18, so I’ve not had a dictatorial boss to learn from. Instead I believe it’s important to let people get on with the job you hired them to do and support them in remaining good at it. For example, we’re intentionally open about mental health issues to make them less taboo. We’ve also introduced mental health days but I don’t know how many sick days they make up of the total as it’s normalised. We don’t ask people what’s wrong with them - we only ask them to let us know when they’re off so we can reassign their work and not let customers down. One of the ‘Haus rules’ is you don’t leave your personal life at the door, which I appreciate is opposite to the traditional way of doing things.

As for dealing with currently high levels of wage inflation across all skill sets, Faraday-Foster says he does not attempt to compete in either recruitment or retention terms on money alone. Instead he has continued to award pay rises based on the industry certifications that each employee obtains, with everyone being given time off and a training allowance to encourage upskilling. As he points out:

It’s a win-win because we need them to have the certifications for our credibility but it also helps them in their career. Our tech team is the core of what we do, so we give them training to get higher paid jobs and help them progress.

But despite the company’s ‘remote-first’ approach to hybrid working, Faraday-Foster has retained and plans to revamp its Manchester-based office. He explains the rationale:

To me, the future of the office is a shared house, although I doubt I’ll go so far as to include bedrooms! But it’ll be a social space for building team cohesion through social events and for collaborating. It’s much more difficult to do collaborative workshop things at an online whiteboard and it just feels more creative and effective when you’re all together in person. It does work but you don’t get the same vibe and you miss body language cues.

Creating a high-intensity collaboration culture

Another organization that prides itself on its company culture, meanwhile, is Digits. Set up in 2018 to sell a real-time financial management platform for small business, the US-based organization is based on what co-founder Wayne Chang calls “a high-intensity collaboration model”.

This approach makes it imperative for either the entire workforce to be “at the same geo-location” or completely remote, he believes. Chang chose the remote option, attesting that:

A hybrid model is the worst of both [worlds] – with some people in-person and some remote. The people in-person have a much deeper understanding and working relationship with their peers, while those remote feel disconnected to what’s happening in the office. To prevent that, embracing full remote has worked.

One of the secrets to success here, Chang points out, is hiring “trustworthy people” who “want to be engaged and build impactful things”, which means setting a “high bar for vetting”. He explains:

This trust allows our people to feel comfortable completing their work within whatever framework suits them…We are team, goal, and objective-oriented and keep our work visible to the entire team, creating systems and [weekly] touchpoints where people’s work and contributions are known and seen. Transparency, collaboration, and being impact-driven are how we’ve built the company.

Another important consideration in staff retention terms, Chang says, is:

Constantly listening and engaging with our employees. They’re our greatest signal about what’s working and what’s not and it’s critical we hear their needs and experiment with how we can adapt as a company to find the perfect work-life balance…Our goal is to understand what motivates them and makes them happy so they enjoy coming to work and becomes ambassadors for the company.

Fostering positive relationships

Other policies he believes are vital to support a positive culture include a ban on pre-scheduled internal meetings:

It seems counterintuitive, but if we need to have a conversation, we’ll just have a conversation and, if it takes three minutes or 10 minutes to reach alignment or resolve an issue, the time will be found but we have it right then and there. If you operate from a place of work always happening and doing huddles and buying in, it speeds up the entire organization. Managing meetings is a task in and of itself. It’s work to work. We love ad hoc spur-of-the-moment huddles.

A buddy system has also been introduced to help foster productive and supportive relationships. Chang explains:

At every organization, large or small, an invisible org chart exists - the official one and the relationship one. The relationship one is what really matters. From day one at Digits, you’re assigned a buddy who will help you through everything, from setting up your computer and answering your questions to introducing you to company rituals. There’s always someone there who’s proactively supporting you at every step. This buddy system jumpstarts that invisible org chart of solid relationships within the company.

Acknowledging the importance of “real-life connection and collaboration” though, week-long, on-site gatherings are also held at different spots across the US each quarter, offering “brainstorming opportunities, workshops, and a healthy dose of team-bonding activities”, he says.

My take

In a highly competitive talent market like today’s, it makes sense to retain valuable staff rather than end up on a continual recruitment merry-go-round. What is clear though is that simply throwing money at the problem is never going to be enough because the secret to success is really about creating a positive, supportive and inclusive company culture.