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Cost-effective solutions for attracting and retaining talent

Author: ICAEW Insights

Published: 26 Oct 2022

Forget traditional pay rises, organisations have a range of far more thoughtful tools at their disposal to show that they are great to work for.

Before COVID-19, employers would stack CVs on their desks in ‘Yes’, ‘No’ and ‘Maybe’ piles. Now, it’s the candidates who are shuffling prospective employers into those piles.

“The entire picture has flipped,” says Stephen Howes, Regional Director for the Home Counties at Michael Page. With the current hiring climate in mind, Howes recognises the importance of employers taking more creative steps to attract and retain talent, rather than relying upon the blunt instrument of the traditional – and increasingly less affordable – pay rise.

“The reality is that employers are now having to broaden their offerings and propositions to suit each candidate’s personal circumstances, including their stage of life. It’s also essential for any business to sell the intrinsic nature of each role, demonstrating its importance to the wider organisation and explaining how it’s linked to the company’s driving values and purpose.”

For many candidates, flexibility is paramount – but that is forcing employers to master a tricky balancing act. “Those that have seen real successes in their talent management have been able to provide ample flexibility, while ensuring employees still feel part of a culture,” Howes says. “If you’re too rigid about when people should come into the office, you look starchy and wedded to presenteeism. Too fluid, and there’s a risk that as an employer, you lose a bit of control – and employees won’t feel an affinity for the organisation.”

Indeed, Howes points out, employers that have done particularly well at this time have turned the benefits of frequent workplace attendance into hooks for retention: as well as being enjoyable, in-person experiences such as teamwork, collaboration and on-the-job training have clear upsides in the career-progression stakes.

Culture of openness

Epsom-based practice Love Your Accountants (LYA) has built a culture in keeping with its name. For Head of London and South East Rob Young, LYA’s primary recruitment goal is to source people who can bring a positive energy to the table and forge close relationships with the firm’s roster of SME clients. “For us,” he says, “it’s not just about numbers.”

As such, LYA has junked a lot of the traditional trappings of talent management, such as timesheets and standard pay rises, in favour of granular KPIs. The aim: to ensure that team members are happy and – echoing Howes’s point – that their work fits in with, and supports, the fulfilment of various life-stage goals.

“We use a series of companywide and individual KPIs to track and monitor employees’ financial performance for the business,” Young explains. “In utilising and monitoring those KPIs, we are then able to calculate fair salaries for all our staff. If money is an important aspect to them, and they want a pay rise, then they know on the basis of the KPIs what is required of them to enable the business to pay them more.”

As part of that, LYA talks to its employees as often as possible about what they want out of life, so it can get a sense of objectives they are working towards – or how they want work to line up with other commitments. “Do you want to pay for a house extension? Do you want a mortgage, or to save towards moving in five years’ time? Do you need to study on Fridays? Do you like going out with your friends and spending lots of cash, or do you value your time more than money? They’re the sorts of things we explore,” Young says.

Amid that culture of openness, LYA allows its people to adjust the number of clients they serve according to their lifestyles and aspirations. “We educate staff on how their earnings affect the overall business. That’s an important step at this time, when we’re set for a big recession next year. Our top priority is to protect jobs – so we want staff to understand how costs and pay levels in the business are all connected.”

On the sourcing front, Young is avidly open minded. “Our latest recruit was previously at Tesco, where he was stacking shelves and chatting to customers. Universities don’t tend to produce candidates who are great at talking to people and building relationships. Our primary focus on that asset has helped us create a vibrant, diverse workforce.”

Compassionate approach

Howes stresses that a diversity and inclusion (D&I) agenda must be part of any employer’s talent-attraction toolkit. “I’m not sure it necessarily helps you stand out from the pack if you have one,” he says. “But it’s very clear that you will drop out of the pack if you don’t. That’s the extent to which D&I is now tied in to candidates’ baseline expectations.”

One increasingly prominent method for employers to hardwire D&I into their business models is by becoming a B Corporation, or B Corp. Achieved through a rigorous and exacting certification process, B Corp status announces not just tangible and scrupulous efforts to protect the environment, but a sensitive and compassionate approach to talent, too.

“We have very active D&I forums,” says Alison Powell, Finance Director at law firm Bates Wells, which was certified as a B Corp in 2015. “We have an ethnicity group, Reach and Rise. We have an LGBT+ group, a social mobility group, a wellbeing group and one for carers and staff with disabilities. Plus, we were one of the first signatories to the Halo Code, which champions traditional presentations of ethnic hairstyles in the workplace and supports people to be who they are.”

As part of its social-mobility mission, Bates Wells also uses talent-development specialists Rare, who help to open up opportunities for candidates from disadvantaged backgrounds.

“I’m in a group of B Corp FDs and we share ideas on topics such as pay. Part of being a B Corp means that you must endeavour to balance salaries between top and bottom earners,” says Powell. “One FD came up with the idea that, instead of giving their staff a percentage pay rise, they would give everyone £1,000 each – because top earners will always make far more from a percentage rise than those at the bottom. So, I’m always listening out for those sorts of ideas.

“For our part, Bates Wells is currently looking at initiatives such as green pensions and living pensions – the latter have particular importance in the current economic climate.”

Cost of doing business

Insights, analysis and resources for organisations facing rising costs of doing business amid a multitude of challenges, including energy prices, inflation, supply chain disruption and staff recruitment and retention.

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