As I was walking around today, I noticed one of the managers had a book about employee retention and it really struck home with me.  This particular book, at least from the title, looked to be about retaining key people (and a follow up search in Amazon verified this) with “love”.

Way back in early 2000’s, we had this thing called the “dot-com boom” followed up by the “dot-com bust”.  I say way back because so much has changed in the last 10 years, a lot of people may have forgotten how development has changed in that time.  The market went from people making exorbitant hourly wages and stock options to a dramatic shift of struggling to even find a job. I was very fortunate as a contractor as I took less than a 10% rate cut and didn’t have one day of bench time.

Most of the other independent contractors weren’t that fortunate. Many took catastrophic pay cuts which dramatically altered their lifestyles. Others left IT altogether.  The developer market was insane during the “dot-com boom”, so in my opinion it needed a correction.

On the flip side, I saw employers taking advantage of the situation. In one example, a friend of mine gave up contracting, and took a contract-to-hire position. After the end of three months, he was scheduled to hire at a certain wage. He worked his contract, but when it came time to hire him, they revised his offer to about $10,000 less than the original offer. It wasn’t a performance issue, and they bluntly told him that. When they revised the offer, they advised him they made the change because the market was poor, and they knew it would be difficult for him to find another job.

The manager who did this and I had a decent relationship, and I pulled him aside to discuss it. He verified they were changing the original offer on all offers which had not been completed “because they could”. My warning to him was that, while his reason is correct, the market would eventually change, and those same people would be the first to leave.  Time proved me correct.

I am a student of history. One of my favorite quotes is as follows:

"Those who cannot remember the past are condemned to repeat it." -- George Santayana

Fly forward 10 years, and again we have a market with developers struggling to find jobs, having to take large pay cuts, and management taking advantage of it. Last year, I was the development manager for a large financial institution with a decent sized team. We had a huge conversion going on, and we had to convert 58 applications in six months. Since a lot of the applications were forward facing, we could afford no errors. Fortunately, I had the right team to do it.

Through incredible dedication our team was successful.  During this conversion, I began to notice a disturbing trend from senior management. It began by demanding reports of hours spent working by individual employees.  No attention was paid to *what* they were working on or the results of their efforts, but rather how much they were working.  It was interesting to note that contract employees were not pressured about their hours, as their hours were all billable.

Fortunately, I am very results driven. After my team submitted their reports, I “adjusted” their reported time (note: this was not used for ANYTHING other than to see who is working and who was not – I wrote the application that did this reporting) so it would keep the team in good graces. My philosophy  has proved to work every time à do your job, do it on time, and do it with quality. If it takes you 80 hours to do it, so be it, but I will make sure you are taken care of. If you can do it in 40, all the better. I know in Extreme programming they hold it to 8 hours maximum per day, but I was never a huge advocate of XP.

The trend with senior management continued, and they began monitoring network traffic. Management now wanted reports, by department and employee, of where employees were going on the internet and how long they spent there.  I met daily with the other IT managers, and I was the only manager who openly opposed this. The main reason they remained silent was because they had access to the logs and could “filter” the reports to senior management. Senior management’s stated belief is that every minute spent on the web was one minute lost of productivity. Don't even get me started on the studies which disprove this.

Their original strategy was going to block all internet activity (except senior management). When I pointed out basic points like looking for code and solutions on the internet was critical to development, this movement lost steam. However, that’s when the reports started.  I knew my time was limited there when I received my inquisition about my team's activites à one employee had watched CNN from his laptop at 9 PM (while working from home) and another had paid his bills online (after working an 80+ hour week).

These same managers would call all the employees in to tell them there would be no raises, a decrease in benefits and reduced time off. Granted, the institution was taking some charge-offs on loans, but from an accounting standpoint, the merit increases would not have impacted the balance sheets significantly compared to other expenditures being made.  In the same meetings, they’d press for more hours of productivity (regardless of status of their projects). In every case, the team was told “the market out there is rough. If you don’t like it here, go ahead and look, you won’t find anything.”

My department successfully completed the conversion with few problems, none of them critical. Fortunately, I saw things were getting worse, and I left that company for another immediately after the conversion, feeling I had met my obligation to my employer as well as my team. I stay in touch, and I hear my team was singled out in a post-conversion "pep rally". The team had been working 70+ hours on average for over six months for the conversion, probably more than any other team, and most projects were complete and things had slowed down. A senior manager told my old team directly: “If you’re not working 65 hours every week, you’re not pulling your weight.  I can hire replacements for you right now at 70% of your salaries.”

I wish that kind of attitude was isolated. The next company I went to had a worse attitude towards employees. On my first day as their new development manager, I was told by their very inexperienced VP of Technology “it’s good to fire people here and there to keep the others on their toes. It’s healthy.” Although there is some distant truth to that statement, it’s also dangerous and naïve as well.

The point of all this background is that history is going to repeat itself. Take the financial company I mentioned. Even in this economy, several key people have already left. Many others have openly stated they will leave as soon as they can.

The book I first mentioned had it right: if you want to keep your employees, you need to show them your love. Regardless of the economy, your key team members will stay as there is more to work than just salary. If you lose a GOOD employee, you stand to lose a lot. For example:

·         Cohesion of the team

·         Legacy knowledge that only time and experience can bring

·         Coding standards – you can have these written, but it takes time and reviews to “train” employees on how things should be done. They leave, you lose this.

·         Investment – good employers invert in their team. This can include training, goodwill or any of a number of tangible and intangible investments made on the team. When you lose a team member, you lose that investment.

·         Loyalty & trust

Sure you can hire new developers, but finding good ones is an art. Will you be improving by replacing your current team? There is certainly a cost associated with it.

It’s not all about salary either. Many times I didn’t have the budget to pay my team what I felt they were worth or even what they could get on the open market. I kept them happy by allowing them the ability to create innovative solutions, be part of the “bigger direction” of the team, and keeping their skills current as the technology changed. All this is part of the “love” a good manager can easily give his team.

After the first “dot-com bust” resolved itself, that first employer I mentioned lost 100% of their team over the first year the economy recovered. I am afraid history will be repeating itself just as harsh this time.