Retaining Talent in Changing Times
Human Capital Strategies of C-Suite Executives: The Future of Food & Ag, Part 2 of 3
In 2021, more than 47 million Americans quit their jobs, the most resignations on record.3 Resignation rates continued to set records in the first half of 2022, and The Great Resignation is not unique to the U.S. but is happening globally.4 While the highest turnover is among workers in retail, food and hospitality, education and office and administration support5, no industry is immune. As a result, companies are facing a void of senior leaders with experience to confidently take the reins and guide companies into the future.
Interestingly, the C-suite leaders we interviewed have not experienced a level of resignations that fit the trend. When they look at the reasons for this, culture is the most resonant theme. In fact, a toxic corporate culture was 10 times more predictive of attrition than compensation during the first six months of the Great Resignation, according to the MIT Sloan Management Review6.
It’s not surprising, then, that C-suite executives told us they want to attract leaders who believe in their mission, as that’s a definite indicator of individuals who are more likely to stay.
According to Kim Nicholson of The Mosaic Company, the organization has a tradition of multi-generational families working for the company. “That tells me it’s a culture where people feel supported and valued.”
Robert Hodgen of King Ranch agrees that culture is the secret sauce to retention: “When a company builds a great culture where you are the employer of choice, then people want to come to work every day and thrive. Empowering our leaders to hold their teams accountable to the values which act as the bedrock of our culture is a critical key to success.” He acknowledges this is a leadership ability not easily cultivated or measured: “Culture is like the wind: you can feel it, but you can’t see it.”
Similarly, Jonas Berndtsson with AAK – Sweden had lower turnover in 2021 than it did in 2020. “Yet we are completely aware the Great Resignation exists, and we need to mitigate it. We feel that the commitment to our purpose and values creates a personal connection to the company that makes it harder to leave.”
Balance of challenge and autonomy keeps leaders engaged
There are other aspects of engaging senior executives that were cited as critical by those interviewed.
For Lisa Escudero of Phibro Animal Health Corporation, the engagement factor hinges on capitalizing on their mission-driven organization, being clear on their strategic focus areas, and importantly, “diversity, equity and inclusion are a core component of how we engage leaders.”
Offering opportunities to solve challenges is a way to keep leaders engaged. C-suite leaders recognize the need for advancement for high performing team members as a way to keep them motivated and to demonstrate their contributions.
As Nicholson says, “For senior leaders, engagement is about continual challenge. It’s an interesting time to be in our industry.”
Victor Ochoa of Granjas Carroll says he cultivates engagement by giving senior leaders special assignments and a variety of challenges, including working in multi-functional teams across different parts of the company.
Kincannon & Reed Managing Director Paul Izenstark agrees: “It’s a good strategy to cross-train leaders – helping them move away from a functional mindset towards one that creates energy, innovation, and learning across the organization. People who need the functional framework may be more comfortable, but the outcomes are not necessarily healthy for the company.”
C-suite leaders also underscore the importance of giving senior executives autonomy and the power and resources to lead. Nicholson finds that an important aspect of keeping leaders engaged is “the freedom to lead as they see fit, in a corporate culture that doesn’t dictate how they get the work done, as long as they get the results.”
Kincannon & Reed Managing Director Lloyd Le Page notes an important recruitment dimension to finding leaders who can lead in this way. “If you don’t recruit the right people, you can’t build that trust. It’s important to spend time on getting the right people. Once you do, and have been clear about the results you expect, you let them run with it. They will have their own style and way of doing things.”
Organizations should not be afraid to pass the baton earlier than they might have planned, cautions K&R Managing Partner Ed Yuhas.
“We often tell our clients that sometimes change is a good thing. I’ve seen more things go wrong with leaders who stay too long rather than those who don’t stay long enough. We ask clients, ‘Would you rather have an A player for three years or a B player for five to ten years?’ And when they think about it, the answer is obvious: the A player.”
Ed Yuhas, Kincannon & Reed
And while changeovers can be costly, Le Page adds, there’s an opportunity cost, too, in time and talent lost. “Sometimes it’s good to have new thoughts, new vision, new input coming in. We want diversity of thinking.”
Hybrid workforce demands new leadership skills
A collaborative and flexible work environment is an important factor in keeping top-level talent engaged, survey respondents and interviewees say, especially with today’s hybrid workforce requiring more agility and adaptability.
More than 90% of survey respondents said they now have a hybrid work environment.
C-suite leaders agree this shift to remote and in-person work requires different leadership
skills. But it also presents an opportunity to retain and develop executives
who thrive in this new paradigm.
“Our leaders have had to find creative ways of working, to adapt and learn,” says Nicholson. “For some leaders, especially older generations, the shift to virtual work has been a difficult transition. But they’re learning; they see people still get the work done. As we go forward, leaders need to think about managing remote teams around the globe, understand cultural differences, and be flexible. That’s another skillset we need.”
It comes down to trust, Izenstark noted, “In the past, we used to have to perform to earn a leader’s trust. And in today’s virtual environment, leaders have to trust that their employee is going to perform. This is very difficult for some leaders.”
Similarly, Berndtsson says AAK’s organizational structure was already designed with small, efficient teams that collaborate globally, so a hybrid model is a natural fit.
To lead in the future, senior executives will have to be adept at communicating and maintaining collaboration in a hybrid environment. For some C-suite leaders, team cohesion will always come down to in-person interaction.
“It’s hard to build culture and collaborative skills in a work environment if everything is remote,” Hodgen says. He encourages his team to have highly productive, focused meetings that are short in duration but maintain the discipline of coming together regularly, “which then frees us up to do the rest of our work and limits distractions.”
Robert Hodgen, King Ranch
Naveen Sikka of TerViva agrees that in-person connection is critical, especially in the fast-paced, all-hands-on-deck startup environment: “We can preserve elements of a flexible schedule, but we also need the productivity and culture connection that happens through in-person work. We let individual leaders decide that balance.”
Among dozens of newly hired executives surveyed, all agreed that leaders who communicate effectively are essential to maintaining productivity and a healthy culture in a hybrid work environment – and that flexibility has become a basic expectation of today’s workplace. The secret to the successful hybrid workplace, says one respondent, is “empathy, clear goals, open and frequent communication, and quick response time from remote workers.”
Le Page noted that, organizations with a flexible structure for remote work best equip their executives and leaders to engage teams by leveraging the many collaborative work software tools that are available.
For firms where spontaneity has been key, in the hybrid workplace, “they need to redefine the structure of the workflow,” says Izenstark. “From strategy and ideation all the way through to execution, they need to figure out when it’s necessary to bring a team together to develop certain programs and to execute them, and when that can be done separately in order to be most productive.”
While current challenges are considerable, C-suite leaders across the food and ag value chain are looking ahead to ensure their human capital strategy is sufficiently robust to handle the change and disruption to come. And that brings them back full circle to the organization’s culture and purpose as the North Star.
“I look at unforced turnover as an indicator of the health of our business,” says Hodgen. “If we can lower our turnover percentage and retain our best talent, a flywheel effect happens within the business over time that we believe improves all other KPIs. We are really focused on filling our company with people that fit the culture, that want to be here. For us, that is the bottom line.”
3 Roughly 47 million people quit their jobs last year: ‘All of this is uncharted territory.’, CNBC, Feb 1, 2022
4 People aren’t ready to quit quitting, Mashable, April 22, 2022
5 1 in 4 workers plan on quitting in 2022, as Great Resignation continues, Resume Builder, Jan 3, 2022
6 Why Every Leader Needs to Worry About Toxic Culture, MIT Sloan Management Review, March 16, 2022