Workplace Culture

Companies Can Name Their Stars but Struggle to Retain Them

By Garry Kranz

Aug. 14, 2012

Most companies can identify their top performers and are able to woo stars away from other firms. But keeping them from leaving remains a vexing problem.

Those are key conclusions of an informal survey of 91 human resources professionals by Sibson Consulting, an HR advisory firm based inNew York. The survey was taken in July during Sibson’s participation in a recent conference on awards and recognition.

Eighty-six percent of companies report being able to identify star performers and nearly all companies express concern about losing their best employees. Conversely, just 58 percent are interested in retaining everyone in their workforce, suggesting companies have become more discriminating in their retention efforts.

Yet there is a disconnection between desire and reality: Just 76 percent of organizations surveyed say they are successful at retaining star talent yet stubbornly high unemployment has lulled companies into believing they no longer need to be aggressive in recruiting and retention, says Jim Kochanski, a senior vice president at Sibson.

Star performers are always in high demand, even during an economic downturn, Kochanski says. “There isn’t a general shortage of talent, but there are critical shortages of high performers and those people with scarce skills.”

Those who are deemed to be among a company’s best also present a great risk should they be lured away by competitors.

“High performers are always able to find another job. And replacing one star with another isn’t as easy as it sounds,” Kochanski says.

Sibson’s research on skills-specific talent shortages is backed by other data, including a 2011 report by staffing company Manpower Inc. Despite an abundant labor pool, Manpower says 52 percent ofU.S.employers were struggling to find highly qualified applicants, up from 38 percent in 2010.

Not all companies are as sanguine as those in Sibson’s informal survey. Most organizations use performance levels, assessment scores and feedback from managers and senior leaders to distinguish high, average and low performers, according to a forthcoming study in September by the Corporate Executive Board, an Arlington, Virginia-based advisory firm. Despite those efforts, only 31 percent say they are effectively identifying their best employees.

Even so, companies may be waking up to the increased post-recessionary importance of providing career growth to their best people. “In general, one of the things that keep high performers around is giving them a sense that they have a future with your company,” Kochanski says.

Sibson found that 77 percent of companies are “careful to make sure promotions go more to star talent than to average talent.” Should they learn a star has been offered another job, 84 percent of companies say they would make a counter-offer in an effort to keep the employee.

In an interesting twist, Sibson says 59 percent of respondents agree that their organization provides “extraordinary rewards” to stars. Ironically, nearly the same percentage (60 percent) use extraordinary rewards to entice would-be recruits to join their firm.

Garry Kranz is a Workforce Management contributing editor. Comment below or email

Garry Kranz is a Workforce contributing editor.

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