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Re-Sending Generation Y: Part 2/5 - Strategic HR Assets

After the dot-com bust in 2000-2001, many companies decided that in order to retain their position in their given markets, it would be best to shift a low-cost strategy for all areas of the company.  Many Gen-Y workers land a job only to find the company's HR department has a low-cost mindset, especially so among small-to-medium sized businesses. I can understand that when you're operating a business, always trying to make it to the next month requires thinking on a short-term level. 

Here's the catch - it will almost always be more expensive for you to recruit, hire, and train a new employee than to retain a current employee. Here's a very simplified low-end example (most recruiting and training costs for small businesses are higher than this): If it costs $1000 to recruit an employee and $500 to train the employee, and you're having employees leave twice a year, then your recruiting cost per position is $3000 for the given year.  But if you set the employee up with basic insurance benefits of $150 employer co-pay per month and give out twice-annual bonuses of $500, then that total annual cost is only $2800.  Plus you have the intangible benefits of having a long-term employee who can build lasting relationships with your clients.

Sometimes retention will require those kinds of benefits and compensation.  Other times it as simple as modifying the schedule of hours.  One previous manager of mine required each employee to be in their seat by 8:00 AM each morning unless they had a very good excuse, then work until 5:00 with an hour for lunch.  My current manager has made it clear that if I want to come in at 8:00 one day and work until 4:45 with a 45-minute lunch one day, and then work from 8:30 to 5:30 with an hour-long lunch the next, that's fine.  His view is that as long as I am completing my job duties and serving my client(s), then I'm doing well.  Assessing these "benefit" differences, I prefer the style of my current manager.

Treating your employees as assets rather than expenses (especially with a low-cost strategic focus) will lower your HR costs and create a better, more attractive workplace for Generation Y workers.