The ‘bottom line’ used to define the net profits of a company and quantify its ability to deliver growth. Now it’s increasingly being used by employees to justify their desire to leave their employer: “The bottom line is I was burned out… didn’t believe in the company… got paid more to leave.”
Dubbed ‘the great resignation’, this mass exodus of employees has made attracting and retaining talent a boardroom issue. Not least as a record-breaking 1.3m jobs remained vacant in the UK alone last month. In no small part this is due to a disproportionate number of high-paid, skilled professionals opting to leave the workforce altogether.
Add in the challenge of attracting talent to drive growth and it’s no surprise employee loyalty is becoming another way to measure ESG (the Environmental, Social and Economic standards companies are increasingly being asked to report on.) Forcing companies that paid lip-service to ‘our people are our greatest asset’ to add people and purpose to their bottom line metrics.
Some employers are attempting to spend their way through the war for talent, by offering huge pay rises to lure people away from their competitors or acquiring start-ups to gain much-needed skills. But what if the people working for those start-ups decide working for a start-up is what they really enjoyed? Or someone else offers them a better pay rise?
There is no quick fix to the war for talent, due to a tight labour market giving employees a once-in-a-generation upper hand. After living through a pandemic, these individuals have reassessed their priorities and experienced the freedom to fit work around their lives. They want a good work-life balance, caring manager, meaning through work and time to look after themselves.
Critical to delivering growth in this context, when employees can easily gain employment elsewhere, is leading the future of work to create a more agile, loyal and inclusive workforce. Not least by ensuring that as well as focusing on profit, your bottom line is also focused on attracting and retaining the people needed to deliver that profit.
When it comes to retaining the existing talent needed to drive growth, putting purpose at the heart of your business is more effective. Humans are psychologically conditioned to look for purpose in our lives and become miserable when we can’t find this.
The bricklayer helping to build a great cathedral will derive far more satisfaction from his work than a colleague who sees himself as only laying bricks. Numerous studies show that giving employees a direct line of sight between their actions and the overall mission makes them more loyal, motived and driven.
Once perceived as ‘fluffy HR stuff’, creating this sense of purpose is now recognised by shareholders and the board as a key business driver, one that in turn requires linking pay, performance and reward structures to align with the board’s vision and ESG priorities.
Another factor critical to delivering growth is recognising that people are indeed a company’s greatest asset. Then it’s about looking at the people risks that could compromise this asset.
If you look at most companies’ risk registers, cyber security, environmental disasters and terrorist attacks typically feature, alongside plans to bring systems and services back online. But what is the plan to bring people back online? What if top performers are going absent with burnout? Or if a fifth of the workforce is leaving every few months? Is that sustainable? How can those risks be mitigated?
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