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The three factors of retention

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After conducting more than 1,000 interviews – initial and exit – Toyohiro Matsuda, head of office, HRD office in Asia at Mitsubishi Corporation, believes people stick around in a job for one of three reasons.

It has been 17 years since I took on global human resources development as my main assignment in my company.

Over the past 12 years, I have been deeply involved in improving the HRD systems of offices throughout the world by interviewing more than 1,000 overseas employees in more than 20 countries.

The process initially started by determining the job value and human value to retain individual employees, after which we revised salary levels under the newly adopted grading system, so as to reasonably reflect their true market value in the industry.

With this process, I retained a majority of high-calibre non- Japanese staff – referred to as national staff (NS) – but also failed to keep dozens. I still vividly remember all of them and how they reached their decisions to leave.

As though it was a “Memoir of NS who passed through my life” (what I would call this if it were a gossip magazine article) I still wonder what I could have done to retain them, and if they would have stayed had I talked to and treated them better, or differently. I have pursued developing individual career management systems with this experience in mind and on a trial-and-error basis.

Now, I feel I have learnt some good lessons from an analysis of each case. There are, in my view, three pillars for retention of high potentials, regardless of nationality. These are money (salary and bonus), the job (including job satisfaction and career advancement) and people (the boss, peers and subordinates internally, as well as customers and collaborators externally).

The three factors are not so surprising, nor are they a new concept, but they may be the most vital factors for retention.  Which of the three factors is most vital to your employees?

Based on the many real cases in my company, the most vital depends on the value systems of the individual. Some think, especially while they are young and impatient, as well as comparatively low-salaried, that money is the most vital factor.

Some believe the job itself is the most important, with the confidence that a dull and tiresome job is like throwing their precious time into a trash box. But what about the last factor, the people?

In my view, and based on my value systems, which I have nurtured for a long time through many cases of successful retention and failures, the people with whom you work with – or for – are the most crucial factor for retention, subject to a tolerable level of remuneration and backed up by a motivating career management system giving high-performers a career path.

As a tentative conclusion, the cause and effect of these universal retention factors is described below – which can be attributed to individual employees, high performers or high potentials:

1. You can’t possibly retain them.
2. You can possibly retain them.
3. You can easily and justifi ably retain them.

I wonder how many Fortune 500 companies’ employees fall into the third category?

We have found that while our staff often fall into the third category in Japan, we usually find staff in the second category out of the country.

Best wishes for you and your organisations in shifting all your talent closer to the third category

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