Finding and Retaining Good Employees

By Kent Sutherland

Have you heard that Come ’N Get It Rentals is hiring account managers for $12 an hour with full benefits?”

“Really?! No I hadn’t heard that but I think we should check it out. I know a guy who works for them. I’ll give him a call right now and see if we can maybe talk to his manager about getting us on with them.”

“Okay, but be careful and don’t let anyone hear you on the phone. And whatever you do let’s keep this between us. John would get really mad and we’ll get fired if he hears what we’re doing.” This conversation (or one very similar) probably occurs more often than most employers want to believe. How many employees are actively seeking employment and using their current employers’ dime to do it? Who knows? But, given the levels of turnover in most rental companies, it probably occurs in just about every rental store at some time during any work week.

Too many rental dealers have their heads in the proverbial sand where employee turnover is concerned. When I first went to work in the industry in 1986, our company’s annualized turnover rate was in the 200 percent range and no one seemed to even notice. High employee turnover was assumed because that was the track record of the retail industry in general. Then we put a pencil to it in 1988 and began to track both the direct and indirect costs of turning over a store at least two and often three times a year. The dollar cost was staggering, but the emotional fallout was often disastrous. I tracked store performance and employee turnover for six consecutive years and confirmed that generally, high employee turnover produces poor store results.

Finding and keeping the best available employees is a high priority for every business owner I know. Being a human resources consultant has allowed me to work with restaurant owners, manufacturing owners, convenience store owners and rental dealers; they all have this common need. But most of them are just beginning to realize that employee turnover is the biggest drain of their revenue dollars because so many expense line items are the result of turnover.

 “SO, HOW DO I FIND GOOD EMPLOYEES?”

You should begin by defining exactly what you think a “good” employee is. Taking the time to create a hiring profile for managers, sales clerks, account managers and delivery drivers may seem to be a waste but it will pay off in the long run. A hiring profile is especially effective for decentralized hiring, which is the norm in rental stores.

Train your managers in the acquired skills of recruiting, interviewing and hiring. Don’t assume they already know—most of them don’t. You can spend a lot of money to recruit the right kind of people then flush it down the drain because those doing the interviewing have not been properly trained.

Recruit internally. Pay your current employees to recruit a new coworker. They all know someone who is job hunting and if you tap that resource you may be pleasantly surprised at the results. But it’s just like customer referrals. The only customers who will refer their friends and relatives to your store are those who have had a good experience. Make sure that experience is a rewarding one.

Be very careful about actively recruiting your competitors’ employees. When you do this you actually undermine your credibility with your current employees. This is one of the prime reasons they may feel no pangs of conscience about job hunting on your time. My advice is to refrain from actively recruiting competitors’ employees and create a policy to distribute to your managers to do the same. However, if those employees contact you, simply tell them about your policy and assure them that you will be happy to discuss employment with them when they are no longer employed. I can just hear the laughter out there even as I am writing this because too many managers and dealers see all people as “fair game.” Come on guys, that isn’t only dishonest, it’s ultimately destructive for the industry.

Recruiting methods can vary from newspaper ads to job and career fairs. They’re all very expensive and often time consuming, and they may yield little return given the current unemployment rates across the country. In my early years in the industry we didn’t have to spend much time or money on recruiting because there was usually a long line of people waiting at the front door. That all began to change in the early 1990s and today’s hiring pool is shared by many more employers competing for fewer potential employees, which leads me to the other side of this coin.

SAMPLE HIRING PROFILE

Store level: Account Manager

Gender: Either

Age: Over 18 years old

Education: High school diploma or GED required. Prefer someone with earned college credit hours.

Work experience: Direct customer contact required and retail sales preferred

Skill set:

• Telephone sales or collections
• Legible handwriting
• Basic math calculations
• Heavy lifting and carrying
• Company vehicle — light truck or van preferred
• Teamwork environment — has worked well with others

Personal Profile:

• Clean, neat appearance
• Personable, friendly manner
• Quick to smile
• Speaks clearly using proper grammar
• Pleasant tone of voice
• Ambitious — knows where he/she wants to go
• Has verifiable, stable employment history
• Compensation expectations are within our budget
• Obviously has personal pride without arrogance
• Makes consistent eye contact when communicating
• Seems to be a good “fit” with other store employees
• Appears to be trainable — isn’t a “know-it-all” type
• Able and willing to work store business schedule

Prehire verification:

• Not a drug user
• Has insurable driving record — isn’t a reckless driver
• No capital criminal convictions
• No felony convictions in last seven years
• Is not currently on parole

“HOW DO I RETAIN GOOD EMPLOYEES?”

Actually this isn’t rocket science or brain surgery. Employee retention is never an accident of nature. You have to want to see it happen and then you have to take appropriate action to make it happen.

Ask them, the employees who leave, “What could we have done differently to have made your employment experience more rewarding?” People leave all the time. Husbands and wives leave their wives and husbands. Teenagers run away from home. Lovers seek greener pastures. Why? If you assume you know, your assumption may be way off base and it can form the basis for a mindset that ignores the real problems. People leave for lots of reasons but most of them are fixable if you care enough to do something about it.

Ask the ones who don’t leave, “How can we make your employment experience more rewarding for you?” I believe one of the smartest things I ever did as a HR director was initiate an annual employee symposium. Bringing together 20 or so men and women from all over the company who represented every job and asking them questions about their employment experience provided us with vital information to reduce our annual turnover into the mid-70 percentile. People will tell you what they think if they believe you really want to know and if they have confidence you will do something about what they tell you.

Employee surveys are also very helpful but compiling statistical data from their responses is only the beginning of the process. When employees see nothing change, they soon lose interest and look for another job. When you conduct a survey of your employees, you’d better be ready to put their ideas and suggestions on the front burner.

Train your managers in the fine art of people management. Their employees are a lot different from a VCR or stereo. If something goes wrong with a VCR or stereo you can use an electronic device to pinpoint the problem and drop in a replacement component. People are a lot more complicated because they have feelings. Far too little money and time are invested in training managers to actually manage the work activities of other people. Most managers know how to do it themselves, but they have little knowledge or skill for getting the same or better results through other people. Over the years I have surveyed nearly 10,000 men and women, some who were still employed and some who had already given up and sought other employment. The number one reason for their dissatisfaction with their job was the way they were treated by their manager. That’s an easy problem to fix but it takes some time and money.

One of the most important things an employer can do to retain good employees is tell them up front what they can expect and then do it. No one comes to a new job expecting to fail but his or her expectations of success may be short lived. They want to know three things that are very important to them: 1) How can I make more money? 2) How can I succeed at this job? and 3) How can I get promoted? If you will answer these three questions and live up to your answers, you will see your employee retention soar.

Recruiting, hiring and retaining good employees is the engine that drives progress. Pay attention to those processes and you will see more money flow to your bottom line.

10 WAYS TO ATTRACT JOB APPLICANTS

1. Offer hourly employees a recruiting award in the form of either a cash payment of paid time-off to be given immediately when the applicant is hired
2. Participate in carefully selected job or career fairs in major population markets and on local community college campuses.
3. If you need to recruit more than two or three employees, organize your own local job fair and advertise interviewing on the spot.
4. Use “Now Hiring” signs in store windows and on vehicles.
5. Determine to “lead” your competition in starting wage and benefit compensation, but be prepared to treat current employees with the same consideration.
6. Figure out creative ways to offer employees more paid time off and highlight that benefit in all newspaper employment ads.
7. Piggyback an offering of employment with current business advertising media.
8. Advertise employment opportunities on local college and military computerized job nets.
9. Place job listings on the Internet — either on your own web page or through a listing service.
10. Always be on the lookout for a potential employee when you go to a restaurant, supermarket, car wash, theater or retail department store.

Kent Sutherland was the director of human resources and training for Action Rent To Own and then Home Choice for more than 10 years. He is now a full-time consultant based in Mesquite, Texas.