By Brett van Aswegen
When I embarked on my leadership journey, I was faced with a choice around what my management style would be. Many traditional corporations at the time managed employees with carrot-and-stick methods, fostering low trust environments underpinned by rigid policies and fear.
We have all seen a star employee who consistently outperforms. But is it possible for most employees to be star performers? Is it possible to have a company full of star performers? And how do you retain these star performers when you find them?
In today’s competitive business landscape, the art of retaining highly skilled talent has become a strategic imperative for companies across various sectors, particularly those in the highly skilled sectors, such as engineering and data science.
The ability to attract and, more importantly, retain star performers is a challenge amplified by numerous factors in South Africa’s business environment. From the scarcity of skilled professionals, due to issues in the education pipeline, to the alarming brain drain phenomenon, where thousands of skilled individuals emigrate out of South Africa annually, the pool of talent within the country is shrinking at an alarming rate.
To compound these challenges, the rise of the work-from-home culture has opened the doors to global competition for cheap local talent. International firms, lured by favourable foreign exchange rates, are increasingly poaching South Africa’s brightest minds, exacerbating wage pressures on local businesses.
In this scenario, the question arises: Is there an alternative to continually inflating wage bills to retain highly skilled and highly mobile employees?
The power of engagement in talent retention
Many companies resort to using money to try to motivate and retain people and annual performance incentives are certainly effective in this regard. However, studies have shown that for people involved in tasks that require cognitive skills, decision-making, creativity and higher order thinking, monthly salaries can be a negative motivator.
There is little to no upside benefit to intrinsic motivation if you overpay this person, but there is a downside negative impact on motivation if you underpay them. So ensuring employees are correctly benchmarked and fairly remunerated against the market is imperative. But what do you do when skilled employees in high demand can always get a higher salary?
The answer for us at Wonga has been to focus on building our company culture around cultivating intrinsic motivation in our people.
In his book titled Drive, Daniel H. Pink outlines three key drivers of intrinsic motivation:
1. Autonomy – A desire to be self-directed, which increases engagement over compliance.
2. Mastery – The urge to get better skilled.
3. Purpose – The desire to do something that has meaning and is important.
Autonomy: With us, our business strategy, outlining what the business wants to achieve, is set at the executive level. As far as possible, decisions outlining how the strategy will be executed are rolled down to the relevant teams. We treat our people like adults and partners in our success, giving them the space to direct critical decisions within a collectively accountable team.
To make this work, we have had to work hard to establish psychological safety to support candid conversations, and be prepared for mistakes and the learnings they bring us. We
tell people that if they aren’t making mistakes, they aren’t trying hard enough. The result of this is we have had transformational ideas coming from open-minded juniors, coupled with strong team accountability for delivery.
Mastery: Coming from a growth mindset, we want our people to develop and grow. Their success builds our success. We have implemented development ladders that allow individuals to manage their own growth at their pace and we follow this up with executive level performance and growth reviews of each individual in the company on their six monthly anniversary. This allows us to recognise growth and avoid delays in levelling people up.
Purpose: As a purpose-driven organisation, our purpose forms the foundation of our culture, allowing our staff to deeply connect with why our business matters to our customers. Every member of our team understands the problem we are trying to solve for our customers, and the impact this can have in our customers’ lives, fostering real meaning in the work they do.
While we continue to develop our culture, we have employee engagement scores in the top quartile of our industry and employee retention rates above 90%.
Nurturing company culture and employee engagement is not just a trendy HR initiative; it is a strategic necessity for retaining highly skilled talent. When employees are motivated intrinsically, and are aligned with organisational values, businesses can thrive in the toughest of times.
Brett van Aswegen is the CEO of Wonga
