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CHL Lesson Plans provide members with ongoing education focusing on supervisory or management issues. These lessons are designed for CHL re-certification, but can be of value to any CRCST in a management or supervisory role.

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Lesson Plan CHL 314
Managing During Labor Shortages: Be an Employer of
Choice and Opportunity [Reprinted from Communiqué: July/August 2009]

The term “Employer of Choice” refers to an organization for which people want to work. Healthcare facilities and the Central Service departments within them should strive to become an employer of first choice (not an employer of last resort!). By contrast, an “Employer of Opportunity” is an organization for which employees want to continue working. Employers in many areas of our country are confronted with shortages of qualified and/or trainable labor, and this significant challenge might not create problems for them if current employees did not “turnover” in search of “better” positions.

Good news! Many strategies to help a healthcare facility and its Central Service Department become an employer of choice and an employer of opportunity are the same. More good news: these strategies are not difficult to implement, and they are of significant benefit to an organization in today’s competitive labor market.

Organizations cannot become employers of choice and opportunity until top-level leaders, managers, supervisors, and others become committed to treating staff members with respect. They do so as they recruit the very best position applicants, prepare them for on-job success, and provide a working environment in which their staff can find pride and enjoyment in their contributions to their employer.

Three basic strategies can be used to address labor shortages. First, managers can increase productivity levels of existing employees. Second, they can recruit from non-traditional labor markets (examples: “empty nesters” who seek employment after their children leave home, and older persons seeking employment during traditional retirement years). Third, those dealing with labor shortages can retain existing associates. Given the specialized nature of Central Service responsibilities and activities, the third strategy (retain existing associates) appears to be the easiest-to-implement, at least in the short-term.

Many healthcare facilities incur employee retention rates that are lower than ideal. Reasons may include the nature of the labor market (for example, facilities in highly populated areas often compete with each other for employees), an inability to match facility and people needs, and ineffective employer retention practices. In fact, many employees “leave their managers” rather than their organization when they resign. This occurs as they encounter negative ongoing interpersonal relationships with those who supervise them. Note: facility leaders will do well to evaluate employee turnover rates in different departments and question why, if this problem is noticed, attrition rates are significantly higher in some departments than in others.

At this point, it is helpful to discuss the concept of “competitive advantage.” In the context of marketing, the term applies to some way that a product and/or service of great interest to customers is unavailable elsewhere at the same level of quality and pricing. For example, perhaps several restaurants in one’s community offer similar products at comparable service and pricing levels. However, the one restaurant with an ocean view will likely be favored “if all else is equal.” This competitive advantage, then, attracts customers to it.

Wise managers also think of “competitive advantage” in terms of what they can offer potential employees that is not available elsewhere. Once determined, they can use this knowledge to recruit employees and then encourage them to remain with the organization. Traditionally, many staff members perceive that what they are offered by all organizations is the same. They basically consider one job to be as good as any other, and then compensation, even if only a few dollars more that that of an employee competitor, becomes most important.

By contrast, employees in organizations which are considered employers of choice interact with managers who are considerate, professional and caring about their staff members. These employees, in turn, tell their families, friends and neighbors about their experiences. The recruitment task is then made much easier, and the organization is able to differentiate itself from others competing for the same employees.

Talented people are a healthcare facility’s most strategic asset, and the challenge to retain staff members has never been greater for many healthcare employers. It is important that facilities and their leaders re-think the strategies used to address this challenge. Reasons include the less-than-standard service levels that may result during the time before leaving associates depart and while new associates are trained to consistently attain performance standards. Performance problems can be disastrous in Central Service, and managers must give a high priority to assure that this does not occur.

Employee retention priorities must be carefully planned to begin when new associates are hired, and these concerns should also be factored into “the ways things are done” within a facility. As this occurs, a proper emphasis on employees will become ingrained in the culture of the organization. This strategy is much better than taking action when a staff member expresses his/her intent to leave (“What will it take to keep you?”) or, alternatively, deciding that people management strategies will be addressed when leaders “get around to it.” Retention should be on on-going priority strategy and not a series of unplanned and, often, relatively ineffective tactics.

Some managers believe that an employee’s level of compensation is the most important factor in determining whether an associate remains with or leaves the organization. However, it is more correct to say that fair compensation is the basic foundation necessary to initially attract and then to retain associates. Healthcare managers must keep current with the realities of their employee marketplace. Question: do all employees know the true value of their total compensation package including the benefits? Taken in total, the value of wages and benefits paid by many healthcare facilities may represent significantly more compensation than many people realize (especially those who relate compensation to “take home pay.”) Managers should not create “false hopes” of unreasonable wage and/or benefit increases when they are recruiting employees and/or during employee performance appraisals. As well, they should ensure compensation equity by using external compensation surveys and internal guides based upon their staff members’ qualifications and performance. Unfortunately, some employers reward (offer pay increases to) those who perform well (which they should) and also to those who do not attain performance levels (which they should not).

Managers should consider how they can develop and maintain an organizational culture which encourages associates to stay. Exit interviews of departing employees might indicate, for example, that many employees leave because of lack of growth and development opportunities, because of better career opportunities elsewhere, and/or because “they are not treated very well here.”

When asked about the most important factors that influence their satisfaction with a job, many staff members indicate that a lack of challenge and recognition, inadequate work/life flexibility, and limited advancement opportunities encourage them to look elsewhere.

Studies across different industries and organizations typically suggest similarities in the factors that help retain employees within an organization. Results of one recent study are shown in Figure 1.

As you review Figure 1, note that almost all of the retention factors relate directly to leadership and that the level of compensation is ranked no. 3. Another way to view the information in Figure 1 is to consider that, within reason, compensation paid by a competitor is not an overriding factor contributing to employee turnover if staff members perceive that the other benefits to remaining with their present employer are satisfactory. By contrast, compensation paid by competitor is more likely to be viewed as a reason to leave the present employer if other potential reasons to remain are viewed as unsatisfactory.

A wide range of recommendations to become an employer of choice and an employer of opportunity can be noted. These include:

• First, select the “right” people. To do so, match organizational expectations with those of potential employees.
• Provide training and professional development opportunities for managers to constantly improve their leadership skills.
• Understand the factors that encourage employees to remain with the organization. (For example, consider those listed in Figure 1 above.) If possible, conduct employee surveys, “listen” to what staff members say during performance appraisal sessions, and utilize effective employee exit interviews.
• Don’t take high-level employees for granted because staff members at all organizational levels compare personal retention and turnover concerns.
• Use the most effective—not the most popular—employee retention methods.
• Focus retention strategies on unique situations.
• Recognize the retention factors that are most important to staff members and attempt to address (provide) them on the job.

In Conclusion

Central Service Managers will do well to consider the characteristics that they personally like and dislike about a supervisor, a job, and the workplace environment. One reason: it is likely that what they (the managers) like and dislike will be similar to what their employees like and dislike. Managers can then work to consistently display their “best boss/job/environment characteristics” and attempt to minimize those with which they do not personally identify.

Contemporary leaders also must know how to select and build talent, encourage trust, build esteem and respect, coach, motivate, improve performance, and communicate effectively. One additional competency: they must be flexible.

Take the CHL 314 QUIZ

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