Acquiring, retaining, and motivating talented employees is not the sole job of human resources (HR) departments; rather, it's imperative credit union leaders are involved, too, Randy Kohout told an America’s Credit Union Conference Discovery breakout session audience today.
Despite a volatile economy and high unemployment, a Towers Watson 2011 survey found the majority of companies struggle to attract critical-skill employees. At the same time, organizations are squeezing merit increases and expecting longer hours, which have led to 57% of female and 59% of male employees being dissatisfied, with one-third planning to seek other opportunities as the economy improves.
“The good news is that there are tools credit union leaders can use to engage current employees and create an environment that's attractive to potential employees,” said Kohout, CUNA Mutual Group’s vice president, organizational capability.
To start, credit unions need to understand there's value in integrating their engagement, retention, and acquisition processes, he said. And doing so makes it easier to attract the right talent, retain top performers, and have a better chance of being known as a high-performing credit union.
“The trouble is, many credit unions not only have separate engagement, retention, and acquisition processes, but they treat all generations of employees the same, which is not wise.” Kohout said.
Employee demographics are not in credit unions’ favor either, he emphasized. Demand soon will exceed supply. More baby boomers are reaching retirement age and younger generations are smaller in size. Plus, immigration won't plug this demographic hole, with many skilled immigrants returning to their country of origin after earning a degree or experience in the U.S.
Kohout outlined the three generations of employees: Gen Y (under age 30), Gen X (ages 30-46), and baby boomers (ages 47-66). Each generation is somewhat unique in what it expects from the employment deal, he said. “You need to be prepared to accommodate different needs.
“As credit union leaders," he added, "we need to rethink the key skills we need to run our credit unions, and differentiate our value proposition based on generational considerations. We need to arm ourselves with being in the business of talent.”
Credit unions must look at their talent from three perspectives: engagement and productivity of talent already in the organization, attraction or recruiting of new talent from the market, and the retention of the organization’s most talented employees, he said.
From the Towers Watson 2011 survey, we learned what engages employees might also help to retain them, and investing in career development can positively impact attraction, retention, and engagement, Kohout added.
While market-based pay is a plus for attracting employees, he continued, retaining and engaging employees requires more than base pay, and includes bonus or performance pay and other rewards. Also, a company’s image includes not only its financial performance but also how it's viewed by its customers, employees, and the community. These varying factors make it necessary for credit unions to develop an integrated approach to managing talent.
“The trouble is, most credit unions view it as HR’s job to make these changes,” said Kohout. “This mindset must change. As leaders in the credit union business, you must get involved.”
Leaders must get involved in their credit unions’ talent management process, he explained, by speaking with new hires about why they joined the credit union, conducting an engagement survey to help identify areas of focus, and taking time to talk with key employees on a regular basis to encourage retention.
“The best thing you can do for your credit union is to understand the true talent needs, and then adapt your current talent management processes to fit those needs,” said Kohout. “This will take time. Don’t expect perfection. Be willing to learn and continually improve.”
Kohout reminded attendees that while employees are often the largest expense, they're also a huge asset—particularly in customer-focused businesses, such as credit unions.