Last week, I had a chance to moderate a discussion about people problems in companies for the Human Dimensions of Organizations Program at the University of Texas that I direct.  After a lively discussion, an incoming masters student in the program talked about difficulties her company has with employee retention.  Like many high-tech companies, hers is lucky to keep an employee for more than 3 years.

Two panel members, Sean Bauld and Catherine Crago took the question in a new direction.  The natural first reaction to questions on employee retention is to focus on ways to compete more effectively in the labor market.  There are many articles on increasing employee engagement and on creating a sense of mission within companies that would enhance people's connection to their employer.

In a dynamic labor market like the one in Austin, though, it may be hard to get employees to stay at a company for too long.  There are many opportunities for people with technical skills to advance and to take on new projects.  Even when a company communicates effectively with its employees and provides competitive wages and benefits, there is still going to be substantial turnover. 

Of course, companies shouldn't give up in this environment.  Increasing retention even six months or a year for an average employee might still save a company substantial amounts of money in hiring and training costs.

But, it might also be possible to think about turnover as a hidden resource.  Skilled employees who leave a company often go to other organizations in similar industries. So, while they may leave your firm, they are still part of your broader neighborhood.

Rather than fighting tooth-and-nail to retain employees as long as possible, an alternative is to acknowledge explicitly the fluidity of the labor market.  Let employees know that you want them to be happy and to find a home at your organization.  But, you are also committed to developing their careers, even if that means helping them to get ready to move to another position.

By working with employees to think about their future, you are creating a strategic alliance with your employees.  Let them know that they are still a member of your family, even after they leave.  After all, their new employer may need services like the ones your company provides.  In addition, your former employees can recommend to other people with technical skills who are looking for jobs.  By staffing your competitors with former employees, you are creating opportunities for future alliances that might benefit your company in the long-run. 

There is a nice analogy here to what happens in the academic job market.  Faculty members train PhD students, and some of those students go on to get university jobs and to become professors.  Top departments aim to staff other top-tier universities with graduates of their program.  These graduates then become sources of cross-university collaborations, grant proposals, and suppliers of new graduate students.

More broadly, this discussion points to the importance of looking for hidden benefits of problems your organization faces.  Yes, turnover has many negative elements, but there may be ways to turn it into a gain. 

What are the biggest problems you face?  Is there a silver lining there that can turn it into a positive?