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Professional Development – Artificial Employment Restraints

Artificial Employment RestraintFear and uncertainty… These two elements drive an individual to remain in a less than satisfying, sometimes degrading, and typically resented employment situation. While here in the United States no one can be truly forced to work, many face artificial employment restraints holding them to a position or a company.[wcm_restrict plans=”79681, 25542, 25653″]

If fear and uncertainty prevent one from acting to the benefit of his or her career and happiness, how then can these obstacles be overcome?

Recognizing the Restraints

Overcoming fear and uncertainty is never easy. In order to do so, the StrategyDriven Professional must first face his or her fear and then confront it through deliberate action that mitigates or nullifies the underlying causes. By doing so, the professional finds those things binding him or her to a position or employer are unfounded conjectures or temporary circumstances that can be effectively eliminated. Some of the artificial restraints holding professionals back include:

Fear of Seeking a New Opportunity

  • Fear that one will not be attractive to potential employers, particularly for immaterial reasons or personal characteristics (age, gender, ethnicity, race, etcetera)
  • Fear of reprisal if one’s current employer discovers his or her ongoing job search, including intra company moves
  • Concern that one’s departure would adversely impact a client, ongoing project, department, or overall organization

Fear of Assuming a New Role

  • Fear of not being able to perform at the next level or in the new position
  • Fear of not being adaptable to new a new corporate structure, policies, and procedures
  • Uncertainty in one’s ability to meet, work with, and relate to new people including superiors, peers, and subordinates
  • Uncertainty in the new position’s long-term viability (though one’s current positional viability often has an appearance of permanence that does not exist)

Fear of Loss

  • Fear of loss of connectedness and association with individuals that have become more than coworkers, individuals one has bonded with through difficult and joyous times
  • Fear of diminished compensation
  • Requirement to return a hiring bonus
  • Forfeiture of a soon to be paid performance bonus (for those remitted routinely such as annual or quarterly individual performance bonus or event completion payouts)
  • Abandonment of a near-term promotion or assignment opportunity
  • Fear of economic recessions, the diminishing of personal wealth and the loss of property
  • Uncertainty surrounding living conditions, such as the need to relocate, travel, vacation, etcetera

Removing the Restraints

While not intending to delegitimize any of the aforementioned retainers, it is important for the StrategyDriven Professional to bear in mind certain balancing facts.

  • Employers discovering that valued employees are considering other positions, more often concerned with employee retention than immediate dismissal or retribution
  • Viable organizations are built on more than the knowledge, skills, and experiences of one individual. Those that are not, place all of organization members at grave employment risk
  • The hiring organization, by virtue of having extended an employment offer, has believes the professional possesses those qualities, skills, experiences, and knowledge to successfully perform in the position
  • New personal relationships will develop with those in the new organization, they always do. Furthermore, new employees tend to draw the curiosity and interest of those already within the organization; helping to further foster personal connections
  • Just because a job is sought and an offer tendered, does not mean the opportunity has to be accepted
  • No one retains a lifetime employment contract with any employer
  • Full compensation – base salary, benefits, training reimbursement, vacation, holidays, travel, working conditions and hours, etcetera – are all up to negotiation, such that any employment offer can be tailored to satisfy most personal needs or, again, does not need to be accepted

After intellectually understanding of employment restraint realities, the StrategyDriven Professional can act to remove the obstacles through deliberate preparation that often includes the following:

  • Ongoing education and training to both sharpen and broaden knowledge, skills, and experiences
  • Maintaining good mental health by focusing on one’s successes and learning from one’s shortfalls
  • Achieving good physical health through sound diet, exercise, and sleep habits
  • Relieving stress by taking the needed mental and physical breaks
  • Securing one’s financial wellbeing by living within one’s means and building the financial reserves that enable employment transitions regardless of the motivating factors
  • Developing a personal support network of individuals who provide encouragement and constructive advice to aid the professional in the achievement of his or her personal and professional goals

Final Thought…

Out perceptions make the circumstances holding us in an undesirable employment situation very real. Yet the formula for breaking these bonds is straightforward… identify restraining factors, confront these fears and uncertainties by defining and understanding them, and develop and implement an action plan to overcome them. By following these simple steps, an individual will create confidence, earn happiness and respect, and begin the journey to becoming truly StrategyDriven.[/wcm_restrict][wcm_nonmember plans=”79681, 25542, 25653″]


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Talent Management Best Practice 4 – Know Your Artificial Employment Retainers

golden handcuffsEvery manager should seek to know the stay/leave propensity of his or her subordinates and certainly that of top performers. While true knowledge of others’ intentions is unknowable and unpredictable opportunities arise, there are artificial retention mechanisms and observable signs that together suggest an individual’s inclination. Recognizing these signs and factoring them into an assessment of employee loss risk is important to a manager’s ability to retain top talent.[wcm_restrict plans=”75992, 25542, 25653″]

Hard Restraints, The Golden Handcuffs

One category of artificial retainers, commonly referred to as golden handcuffs, consists of financial incentives. Because these retainers are provided for and controlled by the organization, managers should have clear visibility to them, their significance and influence timeframes. These retention mechanisms become particularly effective during economic downturns. Some financial retainers motivating employees to remain with an organization include:

  • Sign-on bonuses with a repayment clause
  • Existing employee retention bonus contracts with a repayment clause
  • Annual bonus payout timeframe
  • Operational and project completion bonus payout timeframes
  • Recruitment bonus payout timeframe
  • Pension vesting
  • 401k matching and vesting
  • Promotion retention contracts with a retirement payout reduction clause
  • Benefit offerings not comparably offered by the follow-on organization

In each of the above cases, the retention effectiveness becomes stronger the closer an individual is to meeting the payback date or payout. Once that threshold is exceeded, this artificial retainer effectively goes to zero, potentially unleashing a personnel exodus.

Soft Retainers, Personal Motivators

Unlike hard retainers, soft retainers focus on an emotional sense of accomplishment or newly gained sense of confidence in one’s ability based on the acquisition of a new skill or experience. Examples of soft retainers include:

  • Landmark anniversary within the organization particularly those that are recognized with a plaque or award
  • Major project completion, particularly those providing an individual with the knowledge and skills needed to move to other companies especially if such opportunities are lucrative
  • Academic degree or major certificate program completion (note that these can also be tied to benefit financial reward listed above)
  • Being advanced, even if only in title (such as to senior or professional level within a positional rank)

Other soft retainers are economic in nature but outside of the organization’s control including:

  • Economic downturn that diminishes one’s retirement, business startup, or employment transfer savings
  • Spouse or companion’s retirement

Lastly, are soft retainers tied to individuals important to the employee who motivate the stay/leave decision:

  • Spouse or companion’s retention mechanisms motivating continued living within a geographic region
  • Leader, mentor, or close friend remaining with an organization (note that the departure of this individual will motivate the employee to likewise leave)

Like hard retainers, these retention mechanisms grow in strength closer to the time of event completion and rapidly diminish following milestone achievement.

Evaluating Employee Retention

An important role of every manager is the retention of top talent. In addition to providing a rewarding work experience, managers should be keenly aware of the coming and going of mechanisms further driving retention. When a manager evaluates the probability of employee loss, deliberate action should be taken to identify the existence and elimination of the several aforementioned artificial restraints. Managerial attention to employee behaviors during the timeframe of restraint loss provides insight as to whether the departure of top talent is likely. Behavioral clues that a departure is eminent include:

  • Expressions of dissatisfaction with his or her compensation (pay, benefits, and work environment)
  • Frequent statements of a desire for career and/or job tasking redirection
  • Disagreements with performance evaluations and/or feedback
  • Random, short-term, particularly mid-week absences suggesting time off taken for external interviews
  • Reduction in work productivity and/or quality
  • Verbal and non-verbal cues suggesting impatience or dissatisfaction with the organization and/or its leaders

Note that some or all of the above mentioned items may not be evident as some employees will endeavor to conceal their intention to depart an organization for a variety of reasons.

Final Thought…

Recognizing the risk of employee loss is not to suggest a manager or organization should go to extreme lengths to retain any one or group of employees. In fact, it may be desirable to have certain employees depart the organization and some level of natural attrition is necessary for organizational health. However, an organization should recognize the value of each employee and be willing to consider closure of identified value to reward gaps in order to retain top talent. Such action taken preemptively goes far to not only retain top talent but to outwardly demonstrate a fair-mindedness that curbs the departure considerations of other employees.[/wcm_restrict][wcm_nonmember plans=”75992, 25542, 25653″]


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About the Author

Nathan Ives, StrategyDriven Principal is a StrategyDriven Principal and Host of the StrategyDriven Podcast. For over twenty years, he has served as trusted advisor to executives and managers at dozens of Fortune 500 and smaller companies in the areas of management effectiveness, organizational development, and process improvement. To read Nathan’s complete biography, click here.

Organizational Accountability Warning Flag 3 – Artificial Retainer Driven Complacency

StrategyDriven Organizational Accountability Warning Flag Article“The wheel that does the squeaking is the one that gets the grease.”

Josh Billings (1818 – 1885)
American humorist

It’s a natural human tendency to seek the path of least resistance. For executives, managers, and supervisors, this practice translates into assigning the difficult and emergent work activities to top performers, diverting work away from under-performers, and avoiding employee confrontations. The latter action erodes accountability. Leaders who do not address the shortcomings of under-performers including the provision of overly positive (even if neutral) feedback and unearned rewards (relative to top performers) loudly proclaim the merits of non-performance. Continued high performance and retention of top talent reinforces these errant practices until one day the lack of accountability drives the company’s best employees to a competitor’s business.[wcm_restrict plans=”53554, 25542, 25653″]

What drives top employees to continue performing when not rewarded or worse when the fruits of their labor are bestowed on under performing peers?

Truly StrategyDriven Professionals give their best even when not rewarded. These individuals are internally motivated; something much stronger than the financial rewards and pats on the back provided by their employers. However, they are also intolerant of continued management exploitation. Consequently, these employees leave unaccountable organizations at the earliest opportunity and only remain because of artificial employment retainers.

Artificial employment retainers are therefore the underlying driver of the performance and retention results reinforcing management’s complacency in holding employees positively and negatively accountable. Some of the most common artificial employment retainers contributed to in part or whole by employees’ external environment include:

  • Fear of reprisal if one’s current employer discovers his or her ongoing job search, including intra company moves
  • Fear of diminished compensation
  • Requirement to return a hiring bonus
  • Forfeiture of a soon to be paid performance bonus (for those remitted routinely such as annual or quarterly individual performance bonus or event completion payouts)
  • Fear of economic recessions, the diminishing of personal wealth and the loss of property

Avoiding the accountability complacency that can come with artificial employment retainers in critical to retaining top performing employees. While not all inclusive, the four lists below, Process-Based Warning Flags, Process Execution Warning Flags – Behaviors, Potential, Observable Results, and Potential Causes, are designed to help leaders recognize when they are relying on artificial factors to motivate and retain talented employees rather than on a rewarding work, effective accountability system, and satisfying work environment. Only after a problem is recognized and its causes identified can the needed action be taken to move the organization toward improved performance.

Process-Based Warning Flags

  • Subjective performance evaluation criteria
  • Lack of SMART goal setting
  • Undefined or subjective promotion criteria
  • No critical review of performance appraisals, reward recommendations, and promotional assignments by an individual senior to the originating manager
  • Lack of productivity and attrition performance monitoring on a manager-by-manager basis
  • Productivity and attrition performance trends not included as a component of each manager’s performance goals and reward systems

Process Execution Warning Flags – Behaviors

  • Routine rewarding of a manager’s ‘favorite’ subordinate
  • Leader avoidance of providing critical feedback
  • Low differential between high and low performer compensation adjustments
  • Frequent recognition of all employees regardless of actual contribution
  • Non-performance basis used for employee rewards such as tenure and ‘need’

Potential, Observable Results

  • Eventual attrition of top talent once restraining conditions are relieved
  • Decay of top performer productivity
  • Loss of voluntary/discretionary effort
  • Reduction in creative contributions and performance improvement suggestions by top employees
  • Employee resentment that ultimately poisons portions of the customer base

Potential Causes

  • Existence of artificial employee retention mechanisms
  • Leader accountability complacency
  • Executive, manager, and supervisor conflict avoidance
  • Low leadership competence among executives, managers, and supervisors; often the result of deficient hiring and development processes

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[/wcm_nonmember]Additional Information

Additional information regarding artificial employment restraints and how individuals can overcome them is contained within the StrategyDriven Professional Development article, Artificial Employment Restraints.