Thursday, September 20, 2012

Why Companies Lose Their Best Young People

It's one of the biggest problems facing American companies these days -- the unwanted loss of lots of talented young workers. It's not exactly a new phenomenon, but it seems to be more rampant today. In my opinion, the reason often has to do with companies being penny wise and pound foolish, but I'll come back to that. In the meantime, I point you to an article that I found on LinkedIn.

If you choose to skip reading that article, I'll summarize the findings here. Talented young people leave because they are not learning. They're not learning the business they're in and they're not learning general business skills. Let's look at why this is happening.

I take you back to prehistoric times when I was a young up-and-comer in the consulting world. I had several means of learning:

  • The people that I worked for mentored me and taught me. They explained what they were doing and why. They viewed my development as an important part of their job. My success would contribute to their success.
  • I had the actuarial exam program. Yes, this still exists, but it has never and will never be the best learning opportunity for young actuarial wannabes. While it is improving, much of the examination process still appears to be about reading endless amounts of material to be able to regurgitate long lists of facts. This is not application, it's memorization.
  • I read. I read a lot. I read books -- those things with covers and words printed on paper. I sometimes highlighted those books so that I could find things when I needed them in the future. And, every firm that I worked for distributed hard copies of research memos. 
  • I was a participant in frequent training -- face-tot-face training -- where either an instructor from my office would address interested people from the office, or where designated people from many offices traveled to a centralized location for intensive multi-day training.
Much of this is gone in most companies. Supervisors (as a group) no longer spend much time teaching and mentoring those who support them. Why not? It's not in their goals. They don't get a tangible reward for developing staff. And, in fact, at most companies, if a star young person leaves and even attributes it to a lack of development, no senior person gets dinged for it. Since the senior people don't get money for it, they don't generally focus on developing others. Unwanted turnover costs. It's pound foolish.

Perhaps the exam program is better than it used to be. But, ask the students. For most, this is not the type of learning and development that they want.

Companies generally don't want to spend money on books anymore. Why? People can read snippets online. But, how do young people find the right materials to read online? For many of them, it's guesswork. They have no idea what to trust. They don't even know if what they are reading is factual. They don't develop and they leave. Penny wise and pound foolish.

Most training now is done via teleconference, webcast, or online. It's not as effective. People lose their focus. They don't pay attention. They don't learn and they leave. Penny wise and pound foolish.

Companies save money in terms of hard dollars, but they have lots of unwanted turnover and there they lose lots of soft dollars. In fact, my opinion is that the soft dollar cost of this exercise is far more than the hard dollar savings ... far more.

So, yes, I am suggesting that maybe a little bit less newfangled training and reading and a little bit more of the old-fashioned stuff might be an improvement. That means stop reading other people's blogs, but keep reading mine.

No comments:

Post a Comment