Retention Strategies

Marketing Materials

CORPORATE L EADERSHIP COUNCIL

AUGUST 2005

w w w . c o r p o r a t e le a de rs h ip c o u n c i l . c o m

Fact Brief

Retention of Key Talent During Business Uncertainties

Profiled Institution A B C D E F G Industry Telecommunications Transportation Telecommunications Automotive Financial Services Transportation Telecommunications Employees Less than 5,000 10,000 - 50,000 50,000 - 100,000 More than 100,000 10,000 - 50,000 10,000 - 50,000 50,000 - 100,000 Revenues $2 billion - $5 billion $5 billion - $10 billion $10 billion - $20 billion More than $100 billion $2 billion - $5 billion $2 billion - $5 billion $20 billion - $50 billion Key Questions How do companies determine attrition risk and create actio n plans? What compensation -based strategies do companies use to retain k e y talent? What development- and communication-based strategies do companies use to retain key talent?

Issue Overview: Retaining Key Talent During Uncertainty

Table of Contents Executive Summar y Assessing Risk Compensatio n -based Retentio n Strategies Development an d Communicatio n Strategies Research Methodolog y 2 3

8 13 19

While companies typically focus on compensation to retain critical talent… During periods of business uncertainty (e.g., divestitures, mergers and acquisitions, severe economic downturns), retention of key talent becomes an organizational imperative, as companies need their bes t people to navigate successfully through difficult times . To compensate top talent for the career risk of remaining with a troubled s company or business unit, employers have traditionally turned to compensation -based strategies such as “golden parachutes ” and retention bonuses . Such tactics, however, suffer from several disadvantages . They place extreme strain on a company’s bottom line, are increasingly viewed negatively by shareholders , and may not have the desired effect on retention and engagement. …profiled companies stress the need to...