The business world is headed for a leadership crisis. More and more baby boomers retire every day, and many companies lack future leaders who are ready, willing, and able to take their place.
In their 2014 Global Human Capital Trends report, Deloitte found that 86 percent of businesses believe they do not have an adequate leadership pipeline, and 79 percent believe they have a significant retention and engagement problem. Obviously, these problems are closely related. How can you hope to sustain an effective leadership pipeline if your employees are disengaged and your turnover rate is high? Today’s mid-level director could be tomorrow’s CEO – if she stays on board.
For many HR professionals, the problem begins with the word “retention” itself. The idea of “retaining” top talent suggests locking the front door so your best employees can’t leave. Instead, we should think in terms of continually attracting talent.
The ways in which we convince employees to remain at a company shouldn’t be all that different from the ways in which we convince them to join in the first place. Many marriage experts suggest that to ensure a healthy relationship, you should never stop “dating” your partner. By extension, HR professionals should never stop “recruiting” their current employees.
According to the 2017 edition of Deloitte’s report, 48 percent of employees at American companies consider employee experience “very important.” What this tells us is that compensation and benefits aren’t the only answer to the leadership pipeline problem. Attracting talent begins at a cultural level. Businesses must create an environment where employees actually want to work – an environment where they feel supported professionally and can derive meaning from their job.
Increasingly, employees are demanding coaching and professional development from their employers. When companies provide these support services for their teams, it represents a win-win for everyone involved. Employees gain confidence and increase their efficiency, improving overall performance, decreasing stress, and boosting morale. Employers get an office full of happy workers – who may one day turn into happy leaders.
Providing coaching and professional development helps remedy a significant source of diminished employee engagement: the expectation gap. Employers expect a certain level of productivity and achievement from their workers, and workers in turn expect that they will be given the tools (both literal and figurative) to meet those goals.
If management finds that employees are failing to meet expectations, it may be a sign that the company is also failing to fulfill its obligation to provide appropriate support. This results in disengaged employees who may already have one foot out the door, causing a negative ripple effect on retention, growth, and – of course – your leadership pipeline.
Coaching – particularly from an external service – closes this expectation gap, helping to ensure that employees are well positioned to succeed. External coaching has been shown to increase companies’ retention by more than 50 percent, proving that the more supported employees feel, the more likely they are to stay and grow into future leaders.
More and more companies are beginning to recognize the need to drive employee engagement and create a solid leadership pipeline. An external coaching service is more than just a perk management can offer to employees – it is a long-term investment in the future of the company. The employees you train and develop today may one day step up to the plate and assume greater responsibilities that will shape and mold the growth of your business. That is an investment worth making, and one that no business owner can afford to put off.