The current wave of layoffs may be misleading enterprises about the value of talent retention, erroneously signaling that people’s fear of losing their jobs is a retention tactic. Unemployment is at one of its lowest levels in recent history, yet employee expectations of work aren’t changing. Talent retention should not be relegated to the luxury category of organizational goals in times of economic instability. This is the time to instil confidence in your organization’s future and capacity to weather the storm. Otherwise, when circumstances improve, your top talent will resign and depart, while your average talent will quit and stay.
This is especially dangerous in medium businesses. According to a recent study of middle-market firms, 26% of employees were actively seeking positions outside their organizations, compared to 14% of their large-company counterparts. Even though midsize organizations have a higher retention risk, their smaller size and more close-knit, familial cultures may provide hidden benefits that larger companies may not. According to the same survey, 83% of employees at midsize firms feel proud of their employers, compared to 78% of their large-company counterparts. According to the report, opportunities for progress and promotion (46%) and enjoyable work (45%) are two of the top four concerns for midsize firm employees.
To address such objectives, larger organizations are assumed to have greater resources and smarter talent development systems. However, the often-scrappy character of midsize businesses, as well as the way their work is often planned, may provide surprising benefits in terms of enabling rapid growth and promotion chances, as well as deeper pleasure and meaning from the contributions employees make. That would be good news for most midsize business leaders, who listed employee retention and upskilling as their second-largest barrier to future preparedness in one research.
Leverage the knowledge that comes from broader roles.
Midsize businesses are frequently in a faster development mode than large businesses and haven’t yet had the opportunity to specialize their positions or teams. As a result, the job of many workers covers various activities and outputs. The “all hands-on deck” mindset, which can assist increase income and devotion to customer deliverables, also provides staff with broader understanding of the firm.
In bigger firms, jobs like “customer coordinator” or “sales support specialist” are often narrowly scoped to a few defined activities, and those responsibilities are frequently shared by numerous employees, grouped by area or product category. However, in midsized businesses, these jobs are significantly fewer and cover a broader variety of responsibilities. In difficult times, such breadth may be useful. When recruiting and promotions have stalled and your capacity to absorb extra expenditures has lessened, you might take chances on high-potential employees by giving them opportunities to try out for new positions or projects.
For example, empowering a team to solve for challenges brought on by uncertain times, such as customer retention or expense management, encourages employees in those broader roles to present as company generalists — people who know more about the company than just their job — rather than the narrow functional experts common in larger organizations. This will enable inventive problem-solving – combining perspectives from throughout the organization allows the problem to be perceived in new ways — while also allowing your staff to explore and prove themselves in new areas. They may “try on a new role” without having to look for a new job at a different organization.
This helps break the myth that bigger opportunities only come with bigger companies. While that may sometimes be true, most employees in midsize companies know that it also comes with a “small fish in a big pond” price tag: You may get a bigger role, but you’re also less visible because you’re now swimming in a larger pond with much more fish. By intentionally creating opportunities for employees to demonstrate real impact while gaining new experiences, you strengthen their loyalty to your organization while solving critical problems and allowing both senior and emerging leaders to see and know one another more closely. This flexibility creates a development cycle that can be maintained when you move back to less-turbulent times.
Close ranks between the top and bottom.
Times of uncertainty naturally fragment organizations. People hunker down and retreat into their own silos, grasping at any sense of control they can get their hands on. In large companies, this can be especially destructive as leaders try to rally the organization around a unified path through whatever challenges they’re facing, only to have to work against the centrifugal force of the organization’s fearful and self-protective impulses.
Midsize companies have the advantage of creating more immediate connections between senior leaders and frontline employees. Their smaller size makes it possible for leaders to get close to all employees, regardless of hierarchy, and ensure that the messages they want to deliver are clear, consistent, and understanding. Large organizations are forced to rely on clumsy processes of cascading information, watering down messages, and losing the intended impact of strengthening the organization’s focus and confidence. By contrast, midsize companies can create direct access to employees with messaging directly from leaders that can speed up execution and bolster commitment. Take advantage of this by increasing your top leaders’ engagement with the broader organization. The cohesion you’ll strengthen will help ease any angst and build confidence in the face of uncertainty.
Build stronger leadership by pivoting toward emerging opportunities and threats.
Quite often in large, corporate environments, even high-potential emerging leaders can wait years to get their shot at advancement. And during turbulent times, those opportunities dry up as large corporations tend to turn to their “usual suspects”: the proven leaders who they know get things done. The agile nature of a middle-market company — in terms of scope, size, and market visibility into threats and opportunities — offers the chance to build leaders who can succeed and fail fast. This clear line of sight allows you to gather critical feedback on leaders, give them the specific development support they need, and adjust accordingly.
During troubling times, challenges and opportunities are endless. Unfortunately, so are the imagined risks and downsides to taking a chance on emerging leadership. If you can look past those fears, the evolving nature of your midsize company will offer a plethora of opportunities to develop younger leaders. Look for dissatisfied customers, products or services that have never been fully developed or processes that were cumbersome even in good times. Giving less-experienced leaders, especially those who have not yet been tested with end-to-end responsibility for realizing a result or heading off a significant problem, can prepare them for broader leadership roles.
Consider the growth priorities you may have had to pull back on to weather the current market volatility. Carve out aspects of it to refresh, re-examine, or build acceleration plans for, and get future leaders involved. This builds a cadre of leaders ready to be activated in new leadership experiences when things turn around and you’re ready to double down on growth again. That way, three years from now, if the growth bets pay off and you’ve had to expand the organization’s size, you’ll have leaders already invested in keeping things successful.
Feature your values when making hard trade-offs.
When times get tough, a company’s purported values are usually the first thing to be exposed as good only on paper. In large companies where subcultures more readily form, the nebulous connection between values and actions is almost expected to be cosmetic. But in midsize companies, the clear line of sight between decisions made at the top and actions taken in the middle and on the frontlines emerges more quickly. And decisions and actions that reinforce — or violate — your stated values can strengthen or weaken your culture when the company and your leaders are tested by uncertainty. Lean into this and show employees how committed you are to the company’s values when having to make difficult choices. If you must shut down lines or deemphasize certain markets, make clear how your values are driving those choices. Openly talk about how, even though adjustment or retrenchment may be hard, your belief system enables you to lead.