by L. Gary Boomer
“Human capital” is not just a buzzword flying around our profession today. It represents a genuine shift in the mindset of management toward how they view the most precious asset in their firm — their people. Firms that are the most progressive and are showing positive results on the bottom line are “living” the following quote:
“People are assets whose value can be enhanced through investment. As the value of people increases, so does the performance capacity of the firm.”
There are five key decisions that firms are making to move their firm in this positive and rewarding direction.
Decision No. 1: We will develop a human capital attitude — beginning at the leadership level.
You have heard it before, and you are going to hear it again — it is all about leadership. If the leadership of the firm does not believe that the greatest asset you have are the people, then the people will know it and they will respond (or should I say not respond) accordingly. Staff must be recognized as critical to the firm’s success. I’m not talking about “fluff” here; I’m talking about cultivating an environment of accountability, teamwork, employee involvement and empowerment.
This is achieved by identifying the skills and characteristics that are needed to make the appropriate investment and sometimes even to make a tough decision about letting go of some of your top producers. Ask yourself if you are encouraging the decline of your overall human capital by holding onto staff that are resisting change, being arrogant, abusing authority, treating staff poorly and not taking the initiative to develop others in the firm just because they are a top revenue producer. If the answer is “Yes,” then it might be time to think about how that one person is affecting the entire team and how letting go of one person might produce tremendous benefits to the firm through the remaining human capital you have.
Decision No. 2: We will recruit and retain only the best.
The first step to retaining employees is to find out why they are leaving in the first place! Does your firm have a practice of conducting an exit interview when someone on the staff leaves? I would suggest that you not only have that conversation, but let an outside human resources professional conduct the interview. This is a prime opportunity for you to learn about your firm and what is causing the departure.
You may think it is obvious; they may have told you that they are getting more compensation or have an opportunity for advancement somewhere else. However, a trained professional will discover some underlying and important reasons that will enlighten you and help you make changes that will help you retain future employees.
In a recent survey, the top five reasons employees leave their firms are: lack of appreciation, negative communication of work effort, lack of communication about what is happening in the firm, lack of help when a problem arises, and lack of training. Once you discover what changes need to be made, the next step is to implement a process to hire very talented individuals that fit your culture. The process should include seeking staff that fit with three critical areas of success:
- Cognitive skills: Having the basic knowledge, training and education to complete the tasks that they will be assigned.
- Affective skills: Having the motivation and desire to complete the tasks that they will be assigned.
- Cognitive talent: Having the natural instinct to work the way they need to in order to complete the tasks that they will be assigned.
All are important and should be built into the process that your firm will use in order to find the most talented individuals to join your team.Decision No. 3: We will communicate effectively with all team members.
Communication is one of the top reasons that employees leave a firm. Your staff wants to know what is going on and how it will impact their jobs. One of the first, and most important, pieces of information that you should share is your firm’s overall strategic plan. Knowing where the firm is going is extremely important to your staff.
But don’t stop there! The next important step is to show each staff member individually how their goals and objectives directly tie to the overall company plan. This can be accomplished quickly and easily in the employee evaluation system. Knowing that they are making a difference directly to the overall health and wellbeing of the firm will give them a sense of purpose and show them that they are important and valuable.
Decision No. 4: We will hold our team members accountable for results.
I know what you are thinking. You will scare your staff to pieces if you suddenly tell them that you are going to hold them accountable for their goals and objectives. Initially, that might be the case. But in the long run, they will feel more valued as members of the team if they are given tasks and the expectation is established that they will complete those tasks. When you link performance to a result, the success rate increases dramatically.
One word of caution here: Make the process for accountability simple. It is extremely important to complete the process of writing down the action item, the steps for achievement, and the due dates, and then — most important — talking it through with the team leader. Remember to listen much and talk little, and give the staff member your undivided attention. They must feel that they are more valuable and important than the incoming phone call or the client that is just dropping by.
Decision No. 5: We will build a spectacular workplace.
I am not talking about the way that the building looks esthetically; I am talking about creating an atmosphere that your staff will brag about!
Have you looked at your benefits package lately? Does it include the benefits that your staff is hungry for? Have you asked your staff lately what benefits would be valuable to them personally? Do you have “status distinctions” that show the staff that one level of the organization is far more important than others? Have you implemented a training program based on the needs of the staff? Is there a succession plan in place to show the staff that their future is protected through thoughtful planning?
These are just a few of the questions you might ask yourself about your firm. The bottom line is that it once again has come full circle back to leadership! The really spectacular workplaces today are those that constantly ask these types of questions and then respond as they see the need.
Firms that make the commitment to act on these five key decisions are the ones that the rest of you will be trying to copy in the future. They will be the leaders, have the best staff and the wealthiest partners. They are the ones that “get it” and act on that knowledge.
You decide: Are you a leader or will you be a follower?
The choice is yours!
