I think that all employers recognize that a certain amount of turnover is beneficial, for example letting deadwood go, but a high rate of attrition does have a negative impact on the company.  Especially on the morale of those employees, who for whatever reason choose to stay.

Sometimes I believe that entrepreneur’s are so involved in ‘growing’ their business that they ignore visible signs of employee unrest. When scaling a business upwards I can actually empathize with this having done exactly this myself.  Until one day, much to my surprise (and horror) a small group of my best employees came to me and told me that they were moving on. I learned a valuable lesson about employees that day.

Frankly, I think I had forgotten that employees are people and needed to be treated as such.  I had been so engrossed in business growth that I had become a pretty unlikeable person.

After listening closely to what my employees had to say that fateful day, I learned that its necessary to spend a few minutes of everyday verbally appreciating what people had done.  Something that had not crossed my mind, quite simply because no one spent a few minutes of any day appreciating what I had done to grow the my company on that day.   Every one expected me to do what I had to do, period.  While I had to appreciate what others did.

This was one valuable lesson I learned that day.

Oh! another lesson I learned was that it pays handsomely to – ‘Shut up and Listen’.  I still use this to my absolute benefit with both  employee’s and client’s.

Given the many things that businesses can’t control, I used to think that business owner’s paid careful attention to the one thing that they can control, the quality of the people they hire, especially those who are being chosen to slot into their tech team as a project leader, analyst designer or system architect. These are employees being specifically chosen to be leaders.

To my complete amazement I discovered that business owner’s who claim ‘People are our most important asset’ usually do not think very hard about choosing the right people for the right job. Often I’ve noticed that the selection of employees that will fill the leadership pool is delegated to the HR department with a woefully inadequate definition of their mandatory skills.

Often it is left to the HR department to do some research of mandatory skills that fit a specific job profile and then do their best to find an individual with skills that match.

This approach, while being partially effective, simply does not take into account the direction in which business owner wishes the company go in the foreseeable future.   Hence, there are Microsoft specialists hired in leadership positions a few months before the company makes an extended foray into Open Source tools and technologies to sustain its growth.

Most likely this happens because the company is currently executing a few projects in the Microsoft domain and the business owner has not informed HR of the swing away from Microsoft to Open Source when telling them to bring in leadership. Believe me an ASP.NET domain expert is quite lost coding in PHP during the first three to six months or so.

Sadly, what’s overlooked is that its the quality of people which is really the best competitive differentiator.

If you look at any business model that is consistently successful, you’ll find that its leaders focus intensely on their people acquisition.  Whether you are the head of a large company or in charge of your first profit center you cannot delegate the process of selecting and developing business process leaders to anyone else.

It’s a job, you have to love doing.