Mapping the employee lifecycle
In the graph above, the horizontal axis represents time, spanning from the day that the employee starts, through to the day that they leave. The vertical axis represents employee output.
At the start, an employee’s output is negative because they are not yet contributing to the organisation, but they are still consuming resource. As the employee is onboarded, they start moving towards being a fully contributing member of the team and output increases. Over the life cycle, productivity continues to increase until, eventually, it plateaus. Once the decision is made to leave the organisation, productivity usually begins to decrease and by the last day, productivity is at zero.
There are three key areas that employers can focus on in order to improve the Employee Lifetime Value (ELTV):
- Recruit the right employees and shorten the ramp-up time it takes to become a fully contributing member (Recruitment & Onboarding)
- Increase the output of an employee (Engagement & Development)
- Increase the amount of time someone stays with the company (Employee Experience & Culture)
By making small improvements in the areas above, it is possible to significantly increase the value of an employee over their time at the company, often by 3 to 6 times.
Recruiting & onboarding
Obviously, getting the right person in the first place is the key decision. Smart hiring processes are driven by taking a structured and data-driven approach to sourcing and interviewing. Then comes the onboarding stage, where the employer has a significant impact on how long it takes before someone starts creating value. Some tips to improve this phase:
- Introduce preboarding. Even before the new employee’s first workday, it is important to welcome and engage the new hire in order to grow trust and loyalty.
- Create a tailored onboarding programme. This will guide the new employee through their first few weeks, immersing them in the organisation’s culture and process; identifying their training needs; introducing them to the key people.
Management & Development
How someone is managed remains one of the most defining factors, not only in employee performance, but also in retention.
- Drive internal mobility. Few employees are looking for a job to spend their entire career in. Internal mobility allows them to change roles within the organisation. This retains the people that you want and keeps important skills within the organisation.
- Hold frequent coaching sessions and have ongoing, one-to-one conversations.
- Introduce life-long personalised learning. Employees seek a job in which they can continuously learn and grow. Offer them the tools to improve themselves.
Employee Experience & Culture
Employee Experience (EX) is just as critical as Customer Experience (CX) or User Experience (UX). This has become even more relevant in the wake of the pandemic. Employees want more than just a good salary. It is about feeling that they belong in the organisation, that they are being treated fairly and are being valued and looked after.
- Develop a fair and consistent incentive scheme which rewards the best performers.
- Regularly measure employees’ engagement, feelings and attitudes rather than ignore it all or leave it until it is too late. Feedback should be ingrained in the culture. It should happen frequently, immediately and be very specific.
- Recognising people and praising them for their work right away motivates them to perform better. This goes beyond financial incentives to more symbolic actions – internal awards, congratulatory cards, public recognition, and certificates. All can significantly increase motivation, performance, and retention rates. Lack of recognition is a key cause cited by many people when they leave a company.
- Exit interviews also help to understand what the company is really like, beneath the PR.
The discipline of ELTV
None of this is exactly rocket science, but it is surprising how few companies actually practice ELTV disciplines all the way through the organisation. Some of the worst practitioners are the C-Suiters who are running the business, who should know better!
Having performance metrics for people – and they will be a mix of hard and soft, subjective factors – is essential. Also, whether it is a customer, an employee or a piece of content, the aim is to increase the overall LTV. Yet a “blended” average LTV often conceals the fact that there are distinct pools of people – subscribers or employees – who act in very different ways. The secret of a successful employer and of a smart audience manager is to be able to understand that and to treat different people in different ways in order to create a vibrant, growing and diverse operation.
Trying to assess employees with the same thought processes as one assesses a subscriber file may seem a little cold and analytical, but it makes for happier, more motivated and more productive staff. It also helps to re-invigorate the organisation. And to keep your Glassdoor scores up!
mediafutures is an annual benchmarking survey of the industry undertaken by Wessenden Marketing in partnership with InPublishing.
This article was first published in InPublishing magazine. If you would like to be added to the free mailing list, please register here.