Let’s talk about turnover. One of the most expensive events for a company is the loss of a key employee. High-performing, well-trained employees help an organization function at optimal levels. Losing employees can cost in time, resources, culture, and institutional knowledge. However, turnover is inevitable and becomes even more so as new and younger generations enter the workforce. The career advice given to Millennials is often that it is a disadvantage to stay in one company too long – their skills will become stagnant. Millennials have a concern that future employers will see them as unambitious or not well developed if they stay at an employer more than two or three years. It is logical advice – many industries are rapid to change to keep up with regulation and technology. Switching companies can provide an opportunity to learn new skills and advance personal knowledge. What is missing from this advice is the fact that deep expertise can also come with staying in one place. To really understand an industry, a person needs to stay long enough to see the range of consequences of company decisions. For example:
- What happens when a person launches a new loan product but doesn’t administer it long enough to see the cycle of delinquencies or charge-offs?
- What happens when a company spends money converting a critical vendor, and a significant event negatively affects the vendor relationship before the end of the contract?
- How does a company handle a situation when a key partner closes its doors?
- What happens when a strategic investment becomes obsolete or declines in value contrary to initial projections?
These types of situations can take years to develop, and understanding how to handle them takes experience. One way of learning experience that is currently undervalued is the experience gained by being on both the front and back end of the situation. This type of experience creates an intuitive understanding of both the launch and exit phase of a project or relationship. It creates an internalized understanding of cyclical events. The opportunity to develop these skills gets missed when a person moves from company to company too often. Broad experience provides perspective. Deep experience provides wisdom. Both are critical to organizational culture.
So what should Millennials do when people they respect advise them not to stay in one place too long? Nothing. The burden is on credit unions to keep their employees from stagnating. The days where people stay 10 years or more at one company are mostly over. Millennials still need to understand both ends of project management and economic cycles. But employees should no longer be expected to remain in one role for the duration of their employment or defined by a few key projects or responsibilities in their workplace. High-performing employees will leave, and if they are stagnating they should leave. Credit unions must be intentional about developing employees and giving them opportunities to learn and take on interesting projects. Asset size should not be relevant to a credit union’s ability to provide these opportunities. In large organizations, there are more resources to be spent on employee development. There is also greater role definition, which sometimes creates less opportunity to stretch outside of a defined role. Small and mid-sized credit unions may lack resources, but with a greater burden of operational demand on fewer employees, more opportunities exist to learn and try new things.
Even with the best employee development programs, people will still leave. People change, and new opportunities come along. As an industry, we should not overlook the opportunity to collaborate and help keep the talent pipeline within our movement. I have seen this type of collaboration first hand – an executive will recommend a key employee for a higher position at another credit union because they recognize there is no longer room for advancement for their employee internally.
What if many more credit unions embraced this sharing mentality? Many people make career moves within the credit union industry. We could see more collaborations develop between large and small credit unions. Leagues or other associations could administer a preferred hiring program that allows small credit unions to hire talented employees with an intentional avenue to ‘promote’ the employee to a participating larger credit union when the time is right for the employee. Perhaps larger, better-staffed credit unions could provide a temporary employee when a small credit union goes through a transition. Small credit union employees are hands-on in many pieces of the operation so can offer tremendous perspective to larger organizations. An industry-wide development program could give small credit unions the critical ability to plan for turnover and send their strong employees to a role suited to their skill set. Credit unions of all sizes, particularly CDFIs and low-income designated credit unions, are perfect organizations to offer fellowship opportunities because of our mission-driven culture. Let’s adapt to the current culture, and recognize the opportunities we have to offer when we work together. We are a creative, cooperative industry! What other opportunities exist to help create a talent pipeline in the credit union industry, and make sure our employees are growing, learning and stretching?