Power Sheet – August 19, 2015

August 19, 2015, 1:54 PM UTC

I hear this from business leaders all the time: “Why should I spend money training and developing young employees? They’ll just leave in two years. I’m training them for my competitors.”

Produced by Ryan Derousseau

The problem is getting worse, as coverage in today’s New York Times makes clear. It details the talent raids that hot start-ups like Uber and Airbnb are conducting on established tech companies, especially Google. It describes a 28-year-old software engineer who recently joined a video gaming start-up after five years at Google, where he said he’d been getting one or two emails a day from recruiters.

So why spend money training and developing these flighty, job-hopping Millennials? Because if you don’t, you won’t get them at all. Company recruiters visiting top colleges and business schools say the best prospects want to know their employer will make them even better. That’s one reason many companies are setting up deluxe “[Company Name] University” training facilities.

Getting, developing, and keeping the best people is one of every leader’s most crucial jobs, and you can’t do it the way you used to. Millennials simply cannot conceive of spending a career at one employer. Why on earth would they? The lifelong-employer model ended in their parents’ era, maybe traumatically for them. In addition, today’s employees know their options better than workers have ever known them before. Through sites like glassdoor.com they know what employees at other companies are getting paid and what working there is like. Through social media they’re getting continual anecdotal evidence about other employers around the country and the world. From moment to moment they know where else they could work, how they’d like it, and how much they’d get paid. They don’t wonder if they’re going to leave their job. They just wonder when.

So let’s face it, you can’t keep all your best people, certainly not as many as you used to. But that’s not the issue. The issue is getting better people and keeping more of them than your competitors. Not long ago I asked Honeywell CEO David Cote about that; Barron’s says he’s one of the world’s 30 best CEOs. He recalled visiting his big engineering center in India, where “our attrition rate is about half of what everybody else experiences,” and he asked a group of engineers why they stayed. Was it the company’s social organizations – a cricket club, a band, a glee club? No, the engineers said, everybody does that; it’s kind of an Indian thing.

Instead, it was two things, Cote recalls them saying: “One, we get given a total package of work that we’re responsible for. It’s not a case where we just work all day and then have to check back with somebody in Europe or the U.S. at the end of the day to show what we did.” That is, responsibility and trust. “And two, I can go into anybody’s office in this place to ask for help on something.” That is, openness and collaboration.

What struck Cote most strongly from that experience was “this need for people to just feel fulfilled, to be able to say, ‘I got something done. What I did was important. My boss cares, the company cares. They’re happy to see me.’”

Training and development costs money. But much of what attracts and keeps the best people – trust, recognition, purpose – doesn’t cost a thing. As the war for talent escalates, remembering that reality becomes crucial for leaders.

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