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The “Retention of Key Talent and the Role of Rewards” study by WorldatWork, Hay Group and Dow Scott, Ph.D., professor of human resources at Loyola University Chicago, found that a majority of respondents (83 percent) view turnover of key talent as very costly to their organization and two out of three agree retention of key talent is a major concern of senior management.

Survey participants reported that the No. 1 reason key talent quits is to earn better pay elsewhere. Other reasons include a lack of promotional opportunities, the perception that pay is unfair and dissatisfaction with job and work responsibilities.

As the economy improves, top talent will more on, but organizations can take a few key steps to try and retain them. Many consider the most effective methods for retaining key talent to be:

  • Identify key employees and discuss with them their future opportunities with the organization.
  • Pay key employees above the labor market.
  • Allow flexible hours or telecommuting.

“Rewards professionals are under increased pressure to make counteroffers, increase new-hire offers, and offer special deals to retain key employees,” said Kerry Chou, a certified compensation professional and practice leader at WorldatWork. “The most successful organizations moving forward will be those that develop a clear definition of what is considered key talent, identify them and make a concerted effort to ensure that those employees are engaged with their organization and satisfied with the full range of organization rewards.”

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