GROWING PROFITS

THROUGH
EMPLOYEE
RETENTION

Lisa Elster
Executive Search Consultant
(508) 758-0191
lelster@morrisseygoodale.com
 AGENDA
• Turnover is a big profitability killer - Example
•  Improve Retention and Watch Profits Rise.
• How to Improve Retention:
1. Employee Engagement 
2. Management
3. Recruitment/Hiring
4. Conclusion
5. Q &A

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 ABOUT
Morrissey Goodale is a specialized management consulting
and research firm exclusively serving the architecture,
engineering, and environmental consulting industries.
Morrissey Goodale’s team has helped hundreds of clients
transform and grow their design and environmental
companies into high-level performers through strategic
business planning, mergers and acquisition advisory,
marketing and business development, executive search and
human resources, leadership development, and business
valuation and financial advisory services.

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TURNOVER IS A PROFITABILITY KILLER!

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 EXAMPLE 1
A 200-person firm with 4% turnover will need to make 8
hires just to stay at the same level.
*Total cost at an average cost of $4,554 per hire = $36,432

EXAMPLE 2
A 200-person firm with 16% turnover will need to make 32
hires to stay at the same level.
* Total cost = $145,728

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 EXAMPLE 1
If a 20-person firm has just 2 people leave that is a turnover rate
of 10%.
*Total cost at an average cost of $4,554 per hire = $9,108

EXAMPLE 2
If a 20-person firm loses 4 people with a 20% turnover rate. In
this example, you are likely losing a key part of your firm and
smaller firms have a harder time absorbing these losses.
* Total cost = $18,216

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 IMPROVE RETENTION AND WATCH
PROFITS RISE

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 HOW TO IMPROVE RETENTION
RATES

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 KEEP EMPLOYEES ENGAGED
Definition:
Employee engagement is the emotional
commitment the employee has to the organization
and its goals.
This emotional commitment means engaged
employees actually care about their work and
their company.

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 PATRICK LENCIONI’S THREE SIGNS
OF A MISERABLE JOB
Anonymity – Are employees recognized or more like
cogs in a wheel?
Immeasurability – Do employees have a way to measure
how well they’re doing i.e. do they have objective and
quantifiable metrics?
Irrelevancy – Do employees see how they add value to
the organization?

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 TIPS TO KEEP EMPLOYEES ENGAGED
Regularly communicate the following:

MISSION VISION VALUES

Why does the What the company What’s important to

company exist? wants to be? the firm?

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 VISION
Good firm leaders are capable of creating
clearly defined visions for their firm and then
communicating them to the rank and file.
And show me a firm that can rally its people
around that vision, and I’ll show you a firm with
lower turnover than firms lacking people
capable of steering their ships.

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EMPLOYEE RELATIONSHIPS WITH MANAGERS
As executive recruiters to the consulting
engineering industry, supervisor dissatisfaction
is the number one reason why employees will
consider moving from one firm to another.
Dissatisfaction is common when there are
breakdowns in communications between
manager and employee, and that can often be
prevented through training.

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 IMPROVING INTERPERSONAL RELATIONSHIPS
BETWEEN MANAGERS AND EMPLOYEES
• Invest in management training that sets
expectations including:
• Leadership training i.e. empowering people
with autonomy and respect.
• Development of strong interpersonal
communication skills and instilling the
importance of communicating employee
appreciation when warranted.

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HELP MANAGERS ACQUIRE ACTIVE LISTENING AND
INTERPERSONAL COMMUNICATION SKILLS
• If there is one area that firms can and should emphasize
when it comes to management training, it’s active
listening and communication.
• Employee dissatisfaction with supervisors is almost
always the result of poor listening skills on the part of
the supervisors.
• Teach managers to treat employees like clients. It’s
important for them to understand “what’s in it for the
employee” if they want to understand how to motivate
their staff.

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SOFT SKILLS/EMOTIONAL INTELLIGENCE
What Is Emotional Intelligence?
Emotional intelligence is the ability to identify and
manage your own emotions and the emotions of others.
It is generally said to include three skills: emotional
awareness; the ability to harness emotions and apply
them to tasks like thinking and problem solving; and the
ability to manage emotions, which includes
regulating your own emotions and cheering up or
calming down other people.

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 MEASURING AND HOLDING MANAGERS
ACCOUNTABLE
• Conduct employee surveys to get a pulse on the
organization
• Invest in executive coaching for managers who
need it.

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 CONDUCT EXIT INTERVIEWS
Sample Questions to Ask:

• What led to your decision to resign other than

compensation?
• If you could’ve changed anything about your
position here, what would it have been?
• If you were President of this firm, what changes
would you make?

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 GROWTH
• The second biggest reason we hear from
employees as a reason why they would
consider leaving one firm for another, is
“lack of clearly defined career path.” They
often feel stagnant as a result.
• Growth can help solve this problem because
it creates career advancement potential.

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 CAREER PATH
• Discuss career paths with employees
regularly
• “Ideally, what would you like your career to
look like 2-3 years from now?”
• Listen to employee goals and work to align
their goals with company goals, objectives,
and expectations.

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 COMPANY OUTLOOK

• Employees want to know how the company

is doing.
• Perception is often worse than reality.
• Review goals and communicate any changes
to get back on track.

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 COMPENSATION
• Based on our experience, compensation is rarely the first
issue that comes up as motivation for leaving one firm for
another.
• Recruited candidates typically cite issues like their
supervisor, career path, direction of the company, before
addressing the issue of money.
• Even though compensation is rarely the top issue, it
doesn’t mean that employees will stay if they’re paid
significantly below market rates. Review salary surveys
regularly to make sure your firm is in line with the
competition.

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 COMPENSATION INCENTIVES
• Incentive compensation i.e. bonuses are a great way
to keep employees engaged.
• They should be aligned with company goals.

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 HIRING THE BEST PEOPLE

• Turnover can often be attributed to bad

hiring decisions in the first place.
• Evaluating for culture and soft skills.
• Past performance is the best indicator of
future success/failure.

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 BUDGETING FOR RECRUITMENT
Most firms don’t budget for recruiting. And
that’s a problem. Consider a 200-person
firm that has 10% turnover and wants to
grow 20%.
That would require 60 hires.
*Assuming an average cost of $4,554 per
hire, the total cost would be $273,240.

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 BUDGETING FOR RECRUITMENT
If a 20-person firm that has 10% turnover
and wants to grow 20%.
That would require 6 hires.
*Assuming an average cost of $4,554 per
hire, the total cost would be $27,324.

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DEVELOPING A RECRUITMENT STRATEGY
• Align recruitment with the firm’s strategic plan.
Where does the firm want to be next year, in three
years, etc.?
• Determine the number of positions that will need
to be filled. Don’t forget about turnover.
• Create a culture where recruiting is NOT HR’s
responsibility. It’s everyone’s responsibility.

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 PRIORITIZE POSITIONS
• Human Resources and Operations prioritize
the positions that need to be filled.
• Together, they develop a schedule, timeline,
and budget for each key position.
• Communicate, communicate, communicate

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 RECRUITMENT PROCESSES
• Operations and Human Resources need to work
as a team
• Streamline systems for Recruitment
• Advertising – LinkedIn, LinkedIn Recruiter
• Recruitment database
• Employee referrals
• Agencies

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 COMPENSATION EVALUATION
• Determine candidate’s salary requirements. Be careful about
asking for current compensation. It’s illegal in some States now,
and the trend is growing.
• Have this conversation sooner rather than later.
• Compare candidates requirements to see if they’re within fair
market values. Use salary surveys to make this assessment.
• Determine go/no go to the in-person meeting stage.

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 INTERVIEW/MEETING PROCESS
• Be willing to make the first meeting away from the office
• Keep the Process Simple – No more than two in-person
visits
• Avoid compensation discussion other than the initial
verification of salary requirements in the compensation
stage.
• Sample questions – How would your boss describe you?
What would you like your career to look like two years
from now?
• Sell the culture and the opportunity

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 HIRING PROCESS
• Reference Checks – Do them
• Verify Professional Registrations/Licensing
• How to present the offer
• Counter offer discussion – It’s a must in this
market
• Advising candidates on how to turn in their
notice

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 ONBOARDING
• How the new hire’s first day goes, can go a long
way toward the decision on how long he/she will
stay.
• On day 1, make sure the new hire is set-up with the
basics i.e. computer, phone, voice mail, email, etc.
• Put together a checklist for day one to make sure
he/she knows basics like where the rest room is
located, office supplies, etc.

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• Keep turnover down, and see
profits rise. And how do you
do this?
CONCLUSIONS
• Hire the right people in the
first place

• Set the right culture

• Hold Manager’s accountable

• Keep employees engaged

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QUESTIONS

35
THANK YOU www.morrisseygoodale.com
@MorrGOOD_AEC

morrisseygoodale
 SPEAKER
Lisa Elster| Executive Search Consultant | Morrissey Goodale LLC
275 Grove Street, Suite 2-400 | Newton, MA 02466 | 508.758.0191 (p)
Lisa is an executive search and M&A professional serving the engineering, architecture, planning,
and environmental consulting industries exclusively. She brings broad knowledge of sourcing,
identifying, and recruiting top industry talent as well as connecting buyers and sellers in the
market.
Lisa advises firms on sourcing, recruitment, employment, negotiation, and compensation design.
She is an expert at filling key positions and making strategic hires. Lisa excels at attracting top A/E
executive level talent to her clients and is a skilled negotiator and closer. Positions she has filled
have ranged from Engineers and Architects to Marketing and Business Development Executives.
Lisa eats, sleeps, and breathes the Consulting Engineering, Architecture, Planning, and
Environmental industries every day.
In addition to recruitment, Lisa is a specialist on employee engagement and retention. She works
with developing corporate missions, visions, value statements, and creating roadmaps to help A/E
firms get their businesses from where they are today to where they want to be in the future when
it comes to human capital planning.
Lisa has a bachelor’s degree in business (with a marketing emphasis) and psychology from Milligan
College in Johnson City, TN.

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 Recommended Reading
On Fire at Work: How Great Companies Ignite Passion in Their
People Without Burning Them Out by Eric Chester

The Truth about Employee Engagement by Patrick Lencioni

Emotional Intelligence by Daniel Goleman

Drive: The Surprising Truth About What Motivates Us by Daniel H.

Pink

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