STRATEGIES FOR ATTRACTING AND RETAINING A SKILLED IT WORKFORCE Albert Wong albert@jobstreet.com CTO, JobStreet.com March 2, 2004

Cost of turnover Direct cost: Severance cost Recruitment cost Orientation Transitioning - Learning up and Training Easily add up to 3 or more months of staff cost Indirect cost: Lost of experience and knowledge Opportunity cost Staff morale

Contents What employees want? What employers want? Retention case studies Attracting new staff Contracting and Outsourcing

What employees want? Depends on individual, stage of life/career and external conditions JobStreet Jan 2004 Survey: What non-monetary attraction will best attract you to stay with your current employer? 1. Honest communication/Trust 11.9% 2. More responsibility 4.9% 3. Challenging work 8.2% 4. Career advancement 43.6% 5. Work-life balance 31.4%

Retention Factors Compensation Fair pay equated with performance and effort expended   Culture & Work Environment Strong workplace communications, trust in employer and work relationships Training & Development Training, mentoring, education and career development   Supervisor Role Overall performance of supervisor, working style and relations with staff   Growth & Earnings Potential Opportunities for new skill development, promotion and financial reward From Spherion Study in US

What do employer wants? ROI from employees productivity quality of work Need to balance between short term and long term

Case study – Company A IT organization of a MNC 30 staff 0 turnover in 4 years Freeze hiring/salary increment last 2 year

What is the score for Company A? Compensation One of best paying in town. 14 months over 12 months. Performance based system – perceived to be fair in most instances Stock options Culture & Work Environment Reports directly to US, open communication and feedback, friendly and good work life balance. Minimal politics.   Training & Development Budgeted 2 external training to be taken Internal opportunities Supervisor Role Not dictatorial style – project timeline from bottom up, informal rewards, open feedback Growth & Earnings Potential Headcount growth of 30% for coming year, overseas exposure A balanced work/life environment

Case study 2 - Company B Local company IT department 25 staff 25% turnover in last 2 years mostly in 1-2 years experience range Hot skills - Web development Core staff stayed

What is the score for Company B? Compensation Average compared to direct competitors - MNC Private stock options Culture & Work Environment Flat organization, open, flexible, No politics. Some communication issues   Training & Development Substantial on the job learning opportunity Supervisor Role Mostly less experience supervisors Growth & Earnings Potential Career path not well defined, less exposure compare to direct competitors Less work/life balance

What is your company’s score? Do a informal survey on how employees grade each of the factors on a 1-5 scale. Get feedback regularly besides from formal reviews on what top employees want

Best Practices Don’t plan to retain all Identify stars Work closely with them, and build up relationships. Retain them More demoralizing if stars leave Be flexible - flexible hours (late hours common), no time clocking, casual dressing, free snacks, red tape/hierarchy Work scope Keep open communication and build trust. Make their opinions count. Regular 2 way feedbacks. Stop politics

Best Practices Compensate fairly based on results and competitively vs direct competitors – not general market salary Rewards Cash Training Time off Promotion Stock options Ask what they want – not what you want

Best Practices Set high entry point and expect high standards Promote from within Proper process and documentation Pair staff where possible – back ups Appreciate supporting staff

Best Practices Transitioning stages 3 month acclimatizing barrier Buddy/mentor 1-2 year expectation leap 3-4 years - how am I doing assessment Choose your location well if possible Focus on improving business first

Role of Supervisor Research shows immediate supervisor plays very important in retention Gallop Survey – Book: First Break The Rules Logical since supervisor likely has most effect on working “environment” of a staff Do I know what is expected of me at work? Do I have the materials and equipment I need to do my work right? At work, do I have the opportunity to do what I do best every day? In the last seven days, have I received recognition or praise for doing good work? Does my supervisor, or someone at work, seem to care about me as a person? Is there someone at work who encourages my development?

What attracts new staff? Compensation and benefits Advancement and learning opportunity Company reputation

Attracting Employees Develop a good core team who loves the company Build a continuous learning environment Expect high standards and implement best retention practices

Build an Employment Brand Encourage staff to talk about company with friends Write about your best practices on your career web site Generate publicity - win awards Promote on campus – hire top students Build academia relationships

Other Practices Employee Referral Program Cash based on confirmation Effective for a number of companies Signing bonus for hot areas Stock options

Candidate Sources Based on JobStreet Malaysia Customer Survey

Other staffing options Contract staff Outsourcing Hiring from overseas

Contracting Good for short term peaks or projects requiring specific experience Access to skilled staff Lower overall cost Flexibility No severance cost Disadvantages Possible integration and morale issue Higher salary expected – at least 20% more Direct or indirect through contracting firm Option to convert to staff Treat them like employees

Outsourcing Why outsource? Tactical Reasons Reduce cost Reduce initial capital outlay Lack of internal resources Problematic functions but.. Strategic reasons Business focus on core areas Access to “better” capabilities/standards Shared risks

Outsourcing Disadvantages Losing control Vendor might not be able to provide desired results Losing trained staff Know what you want explicitly – specification, performance levels, internal interfaces Work closely with outsourcing firm Outsource development but down in house

Hiring Foreign Staff Usually on contracts Immigration Easier to retain Recruiting process Use search service as local knowledge needed Hire from good schools Culture issues

Conclusion There is no magic bullet to attracting and retaining staff Work on finding and providing what each of your core employees values AND towards long term improved productivity in return And if you are looking for IT staff in Malaysia, Singapore, India and Philippines, visit www.jobstreet.com or email us at sales@jobstreet.com

JobStreet CAMPUS Virtual meeting place for employers and fresh graduates Ready access to full resumes of more than 30,000 new graduates JobStreet.com promote companies in campuses and colleges                                                                                                                                                                                                                                                                     

JobStreet Select Executive search and selection services Combines our large database of over 2.5 million jobseekers and classical head-hunting skills Experienced Consultants to facilitate the process

JobStreet Essential Online advertisement Job matching - Email notification to suitable candidates Browsing candidates are able to apply online immediately to your job advertisements SiVA Resume Management Application to zero in on the right candidate