The conventional way of holding on to star employees for as long as possible and discouraging them from leaving through various non-compete clauses may not be the best way to run your business, said author and professor of management at Dartmouth College, Sydney Finkelstein.
Finkelstein, writing in The Wall Street Journal, recounted how the “world’s greatest bosses … achieved outstanding results in large part because they abandoned conventional thinking about keeping the best employees”.
“The leaders I studied built iconic businesses, transformed entire industries and in a number of instances became billionaires not by hoarding great people for themselves, but by mastering the flow of talent through their organizations,” he said.
Calling it the ‘talent-flow strategy’, Finkelstein said this is especially useful in today’s businesses because of the number of millennials entering the workforce. Studies have shown that this new generation of workers are not inclined to stay in one company for very long and see themselves frequently shifting jobs.
He argued that when employers actively encourage top employees to seek other opportunities, they are in turn opening their doors for more, possibly better, skilled workers.
“You’re better off having the best people for a short time than average people forever,” he said.
Still unconvinced? Finkelstein said that maintaining a good relationship with former employees not only helps your network, it also helps your brand.
Former employees can talk up your learning and development programmes to others and these candidates would more likely accept below-market pay just for the opportunity to work with your brand, he said.
“Outstanding bosses who let their top talent leave developed reputations as launchpads; their companies were places to go to supercharge a career,” he said.
Think of yourself as a “talent magnet”, he advised.
“Imagine you have outstanding young people, each smarter and more creative and ambitious then the last, knocking on your door every day,” he said.
“In this scenario, your goal in managing talent is not to keep any one person, but to do what it takes to establish a strong talent flow, and to remove any impediments to that flow.”
This article is from HRM NZ by Lauren Acurantes.