One of the most important sectors of the U.S. economy, according to a 2011 research study by GE Capital and The Ohio State University’s Fisher College of Business, is the “middle market”—companies with revenues of $10M up to $1B, which account for one-third of GDP and private-sector jobs. This insight-driven study contends that even over the past several difficult years, “this sector has been growing, and, if it were a country, its GDP would rank it as the fourth largest economy in the world.”
Among the findings are significant quantitative analyses of the challenges for mid-market companies to find, recruit, and retain human capital—both in critical skills areas and management talent. Executives and owners say key talent is necessary to support existing operations and customers. Top recruits and key performers doing stellar work for these companies want career opportunities and growth to join or to stay with an organization.
Here’s the inherent paradox for human capital leaders: mid-market companies may have limited career paths, and promotional opportunities may not coincide with the readiness or desires of employees to move up or move out.
Some companies find their solution in compensation increases. Projected median increases for compensation in 2013 are 3 percent (The Conference Board; Hay Group), but this figure may go up to 4.5 percent for top performers. Other companies increase training programs or tuition reimbursement, relying upon a hope that their employees’ desire for growth will be satisfied by learning new skills or gaining more knowledge. But will 3 to 4 percent increases in salaries or additional training work for a large percentage of the workforce, and is it sustainable? Or, is there another approach to the paradox?
Consider a study completed by industry analysts from the BrandonHall Group, who explain that successful organizations are thinking about employee recognition differently, focusing upon “career enhancing” strategies instead of or in addition to career management and career pathing strategies.
What does this mean for mid-market organizations and is there a solution for the paradox?
If a mid-market company advertises that it will create career paths and offer career development opportunities that will lead to career advancement through career management for its employees, it continues to perpetuate the untenable situation that the company will outline a career path, provide training, and develop other methods that lead to promotions and upward mobility. If the employee believes that this value proposition has not been fulfilled (often in the timeframe he or she has in mind), the employee may become disenchanted and may begin to look for other opportunities.
On the other hand, if the mid-market company provides career enhancement activities, the employee can learn skills that transcend career management and support employee growth—no matter what role the employee has today or what trajectory his or her career takes.
Just what are career enhancement activities and how can mid-market organizations implement them?
Stacey Harris of the BrandonHall Group (in a recent webinar) focused on confidence, competence, and connections building. Mentoring for confidence building, training for competence building, and networks for connections building are ways mid-market organizations can help employees develop career skills such as empathy, inquiry, innovative and critical thinking, analytical and emotional intelligence, social presence, and dialogue.
Here are a few specific suggestions:
- Utilize existing employee resource groups or invite employees who want to have discussions about possible careers and career aspirations to meet, informally, outside of normal business hours; provide a physical meeting place or telecom support for virtual groups.
- Support the formation of communities of interest on various functions or disciplines where employees can gather to hear from experts within the company or have a dialogue about the discipline or field, what the role entails, and what skills are needed for success in that field.
- Identify transferable skills, such as the career skills mentioned above, and point employees to sources (internal programs online public programs, which are often free) that teach these skills.
- Establish and support peer conversations about best ways to solve career challenges; for example, whether to go back to school for a degree or additional credentials, how to work smarter not harder, how to balance life and family, or working in a multi-generational workplace.
- Create an employee-driven mentoring program that is established and coordinated by an employee team with support from management.
Career development does not have to present a paradox for mid-market organizations. Contradictions can be opportunities for innovation. In fact, innovative career development is a critical career skill.
Joanne Dustin will be discussing this topic in more detail during an ASTD webcast on October 10.
