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Re-Recruiting Works

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Interview with Bill O’Malley

Consider the benefits of scheduling bite-sized meetings with employees. The value of these ‘stay’ or re-recruiting talks can be huge.

Everyone in our industry knows that many home furnishings retailers have been running short-staffed. This was discussed in a September/October Furniture World issue interview with management recruiter Bill O’Malley. (“Turnover Tsunami”).

This time we continue our conversation with Bill O’Malley to take a deeper look at what Furniture World readers can do to make sure they stay as close to fully staffed as possible in the coming months.

Employee Retention

“Retention,” O’Malley advised, “is the most important thing retailers can concentrate on right now. Everybody from clinical psychologists to HR leaders nationwide says that employers need to get closer to their workforce.”

Retention Metrics

O’Malley said he recently spoke with the CEO of a large retail furniture organization, who had not measured employee turnover rate, about how long his operation takes to fill key positions and other basic metrics (see charts 1 & 2). “Part of any recruiting needs-assessment is to understand an organization’s culture and why people leave,” he advised. “For example, if a retailer has seven salespeople and they are supposed to have 10, they need to know what impact that employee shortfall has on sales. Collecting this information is a first step to finding solutions to employment issues.”

Career Paths

In this time of high employment, employees are thinking about the benefits of working for employers who provide them with opportunities to grow and feel valued within organizations. “They want to feel like part of a team and believe in their employer’s mission,” O’Malley added. They do not want to hear general statements about how great your company is or how, working together, ‘we can all get the job done.’ Any furniture store whose people don’t feel a deep connection to their company and its mission, who don’t feel valued, or suffer from burnout, has a problem.

“Over the past four years, I’ve received an increasing number of inquiries from furniture retailers asking if I can help them recruit salespeople, warehouse employees and other front-line workers. In the past, these positions are ones that store owners would never have considered paying a management recruiter to fill. The economics of it, even in these times of full employment, just doesn’t make sense.

“My reply to them is that one of the most productive things they can do to avoid becoming short-staffed is to focus on retention.”

What is Re-Recruiting?

“One of the best ways to improve retention is for retail CEOs to schedule bite-size conversations with their people.” He calls these ‘stay conversations’ or re-recruiting. “Re-recruiting,” he explained, “starts by scheduling one-on-one in-person or even Zoom meetings with current employees.

“For CEOs who employ 50 or more people, speaking with every employee is impossible, so responsibility for having re-recruiting conversations needs to be split up. “The duration of these conversations should be about 15 minutes, over a cup of coffee or a short lunch.

“Large retailers might need to organize their effort using pyramid groups. The CEO re-recruits the corporate team. Regional managers re-recruit store managers and it filters down from there. The math is simple. The purpose is to:

  • Talk to them about their work environments.

  • Find what they like most about working at your company.

  • Ask them if they feel like they are part of a team of co-workers.

  • See if they have problems with toxic team members.

“It’s understandable that managers may be reluctant to have these conversations because there are always a few employees who are difficult to work with or are time vampires. That’s why these meetings need to be structured to avoid going down rabbit holes or devolving into gripe sessions.”

A Sample Conversation

“Here’s how a conversation might begin with an employee. Joni works on the sales floor as an assistant store manager or is, perhaps, a sales design consultant. She has some skillsets and is looking to advance. Wouldn’t you rather give her that opportunity than have her work for a competitor? Unfortunately, when people aren’t listened to and feel that they don’t have a voice, that’s what happens.”

CEO: Joni, let’s talk about where you are today and how satisfied you are with your role at XYZ Furniture. Where else do you see yourself going?

Joni: Oh, my gosh, I have no idea.

CEO: How do you think I can help you grow to achieve your future goals at XYZ Furniture? Or, Are there other roles in our company you’ve been exposed to that you might like to target?

Joni: Ok, I’ve always thought I might make a good buyer.

CEO: Joni, that’s very interesting. What a great area. I am interested to know why you feel that job would match your skillsets?

Joni: I have a bachelor’s degree in Business. And, I’ve always had a flair for style and color. Plus, mathematics comes easy to me. (A key benefit of this conversation is to discover little gems of information like these.)

CEO: I will meet with our buying team and get back to you with an idea I have about giving you an opportunity to spend some time in that area. Perhaps you can shadow our upholstery buyer on a scheduled basis to get a bird’s eye view of what a day in her life looks like. If that goes well, we can follow up at the next semi-annual succession planning meeting. I will put a note on my calendar to get back to you with a plan. How does that sound?

Note: Another great area to focus on right now, coming off two stressful years, is work/life balance.

CEO: Tell me about your work-life and family balance. How are you managing things? Having gone through the stress of the pandemic in my role as CEO, I can sympathize with team members at XYZ Furniture who are closer to the front line. So please tell me about that.

Joni: One of my five kids got COVID a couple of months back that disrupted the whole family. I have a mildly autistic son who needs extra attention, and my husband manages a restaurant. All this, plus working retail hours has been difficult. I cannot wait until things get back to normal.

CEO: Thanks for being so forthcoming. I want to find a way to help. If you are interested in speaking to somebody, I have a resource I can recommend. And, we can also look at arranging some PTO to help you regroup and get your strength back.

Note: Most insurance plans have a Health and Wellness Advocate line.

CEO: I would like to ask you a few more questions. Are you familiar with and believe in our mission here at XYZ Furniture? Do you feel like you are part of a team that is making good on that mission? Do you feel valued, and if not, what can I do to help you feel that way?

Some people will lie to you; they’ll hedge and say what they think you want to hear. So, try to make these conversations personal

It Takes Guts

“In the sample conversation above, when it becomes evident that Joni needs some help, the CEO should be thinking of ways to help her rather than have her become the next turnover casualty. It is not the job of any CEO to be a clinical psychologist. However, even asking questions during these bite-sized sessions and listening carefully to the answers will show that you have empathy and care about the employees.

“Some people will lie to you; they’ll hedge and say what they think you want to hear. So, try to make these conversations personal by opening up and sharing a bit about yourself and your feelings. It will have a powerful positive impact on retention.

“It takes guts to have these conversations, especially for retail leaders who haven’t previously cultivated deep and ongoing personal connections with mid-level and front-line employees.

“When done well, all of a sudden, personal relationships get built based on shared experiences. My suggestion is to start by making re-recruiting conversations quarterly, then go to twice a year.” O’Malley says that once started, stay conversations tend to continue organically on the sales floor, in the showroom, warehouse or at teamwork-level events like barbecues or pancake breakfasts. Right now, though, casual group interactions are not enough. Furniture retailers need to be more proactive.

Remote Working

“The suggestion that retail employees don’t need to be in the office all the time makes most furniture store CEOs’ heads explode. Your warehouse management team does have to be where the work gets done. However, once or twice a month, they might be given the freedom to do performance appraisals or other paperwork at home.”

Bill O’Malley advises Furniture World readers to challenge the belief that there are some jobs that can never include remote hours. When possible, trusting workers to do this on certain days is one of the most powerful ways to avoid turnover.

Chart #1: Time To Fill Tracking Worksheet
Position Title Department Opening Approval Date Date Offer Accepted Candidate Start Date Time (Days) to HIRE Time (Days)to FILL # of Positions Filled Average Time to HIRE Average Time to FILL
Sales|Design Consultant Sales 2/10/2020 2/24/2020 3/7/2020 14 26 1 14.0 26.0

Chart #1 shows a simple worksheet your HR team or hiring authority can use to determine how quickly your key positions are being filled.

Time (Days) to Hire – This is the number of days from when the opening or requisition to hire is approved to the time an offer is accepted or signed.

Time (Days) to Fill – This is the number of days from when the opening is created until the new hire start date.

For small- to medium-sized businesses Days to Fill is the number to focus on. Every day that an opening is left unfilled results in lost productivity and sales. Over time, losses resulting from understaffing on the sales floor, warehouse, office, buying and support departments can be staggering. Under-staffing also increases stress and shifts workload to remaining staff that may cause additional turnover.

 

Reduce Work Hours

“Another way to improve retention is to address employees’ work/life balance.” O’Malley observed that “reducing store closing times by an hour or two, for example, from 9 PM to 7 PM, can be highly effective.

“This may sound like risky and radical thinking, but there are many stores that have reduced hours or remain closed on certain days, even holidays such as the Fourth of July, Christmas and Easter. They then build events around the edges of those holidays to drive traffic.

“Doing this can boost recruiting and retention by sending the family-friendly message that management cares about employees’ work-life balance.”

Randi Schachter, a fourth-generation family member at BILTRITE Furniture, was quoted in a 2019 Furniture World article, “Our motto is ‘Seven days of business in six days’, and we are doing it! BILTRITE has continued to grow each year and we should have closed on Sundays years ago!” O’Malley added that “Reducing their selling hours to six, closing on most Sundays and some holidays have helped BILTRITE retrain customers and make their staff more productive.”

Wage Inflation

O’Malley recalled a conversation he had about a year ago with a retailer located in a remote area of the northeast who intended to pay between $55,000 and $60,000 for a warehouse manager. “This CEO, who decided to do his own recruiting, hired someone for $55,000 who lacked industry experience. That employee left after seven months, and the retailer is now trying to re-fill that position offering $75,000 as a base salary.

“Good category buyers who would have made $80,000 to $85,000 are being offered $100,000 to $110,000. “It’s not hard to imagine that when a new employee is offered $15,000 more than someone hired just a year before to do a similar level job, problems can arise. “I work with a smart, young CEO who recently hired a warehouse manager for about $80,000 per year. A potential wage comparison problem arose since two other experienced managers in her organization made less. My advice was to sit down with the other employees and discuss salary increases.

“There has been some push-back from CEOs on current salary offers. Many feel that they cannot afford to pay current rates, but there are really very few options. I would say ignoring market pay rates by being stuck in the past will lead to lower quality hires and higher turnover.”

Chart #2: Turnover Rate Calculation
Month Number of Separated Employees Average Number of Employees Monthly Turnover Rates Quarterly Turnover Rates Annual Turnover Rates
January 1 10 10.0%
February 1 9 11.1%
March 0 10 0.0% 21.1%
April 2 10 20.0%
May 0 8 0.0%
June 1 9 11.1% 31.1%
July 0 10 0.0%
August 2 10 20.0%
September 1 8 12.5% 32.5%
October 0 10 0.0%
November 1 10 10.0%
December 0 10 0.0% 10.0% 94.7%
 

Chart #2 illustrates the cascading effect that one or two resignations per month have on an annual turnover rate. In this example, monthly turnover contributes to an annual turnover rate of 94.7 percent. The result is constant training as well as stressful working conditions for employees and managers. Focus on monthly, quarterly and annual “Turnover Rate” trends.

Employee turnover rate is easy to track by pulling data from payroll. It is calculated by dividing the number of separations during a month by the average number of employees, multiplied by 100.

Turnover Rate = Number of Separations / Average Number of Employees X 100.

Benefits

“Everyone needs to make sure the benefits offered match up. People are looking for medical and a 401(k). If you are not paying at least 50 percent of the employee’s medical (not including family coverage), don’t provide a matching 401(k), and if you don’t have a solid PTO policy, you will lose people. Offering one week of vacation after working for a year and then edging up to three weeks after five years will just not cut it.

“Companies are updating their PTO plans. The day someone is hired,” O’Malley added, “they should start accruing PTO hours. You do not need to give them PTO in their first month, but it should be accruing. They should have usable PTO by the time they get past your introductory period at 90 days or 120 days.“

Turnover Metrics

Circling back to metrics, Bill O’Malley concludes, “One of the first things retailers need to do is have turnover metrics at their fingertips. Here are the major metrics to track. Most companies do not currently track the days to hire or time to fill metrics. Chart #1 shows a simple worksheet your HR team or hiring authority can use to determine how quickly your key positions are being filled. Chart #2 illustrates the cascading effect that one or two resignations per month have on an annual turnover rate.“


Questions about the topics covered in this interview with Bill O’Malley can be directed to Bill care of editor@furninfo.com.

About Bill O'Malley: Bill O’Malley is the owner and co-founder of Connector Team Recruiting, a specialized search firm working with Furniture | Mattress | Electronics Owners, Presidents and HR executives. Since 2012 he has connected Furniture Enterprises with top talent. Connector Team is an affiliate office of MRINetwork, recently ranked as a Top Recruitment Firm by Forbes Magazine.

To read Bill's blog on the Connector Team Recruiting website, click here.

If you want a pdf copy of the MRINetwork Recruitment Trends Study, call Bill O'Malley at (434) 227-4330 or send him an email at bill@connectorteamrecruiting.com. Connector Team is headquartered in Charlottesville, Virginia.