Retention vs Engagement

There’s an old story that’s meant to promote the value of investing in your team. It goes something like this.

A CTO and a CEO are discussing the budget for the upcoming year. The CTO is trying to carve out budget for education for his team. The CEO is unsure. CEO: “What if we we set aside this educational budget for our employees and they leave?” CTO: “What if we don’t, and they stay?”

It’s a good story. It’s fun, it’s short, and it drives the point home. Invest in your team, and it will pay off. But there’s another lesson in the story that’s almost as valuable. Retention isn’t enough.

Have you been in a room with other leaders talking about people goals for the year? If you’re lucky enough to have a people team, maybe you’re in there with them and some other functional leaders, and you start talking about the upcoming year. The company is hitting a new stage, some people are leaving, and it’s probably worth assuming some percentage of the team is going to turn over this year. And then somebody makes a suggestion. Let’s make sure we retain 90% of our team this year. This is an admirable goal. Retention is a start, but every time you hear “retention”, you should be thinking “engagement”.

The Difference Between Retention and Engagement

The difference between retention and engagement is like the difference between a dartboard and the bullseye. Yes, you can aim for the dartboard, and sometimes you’ll hit the bullseye, but if you aim for the bullseye, you’re more likely to hit the dartboard. Retention is keeping your team intact. Engagement is keeping your team focused on doing great things.

Usually when a team is talking about retention, they’re expecting that given a certain number of people on the team, a certain amount of work can get done. But you know better. When you keep people who aren’t doing great work, your team’s work can do worse than come to a stop; it can start moving in the wrong direction. A team member that’s retained but not engaged is actively hurting your cause.

On the flip side, team members that you can keep engaged are doing great work. If your team members can do great work and they are properly recognized for it, all of a sudden, retention is no longer a concern. Anyone who leaves a company while they are doing great work and feeling recognized can generally be chalked up to non-preventable circumstance. Meanwhile, you are keeping the near totality of folks who are contributing to the team mission.

But if they’re so similar, won’t aiming for one solve the other? A great test to use is to ask if a tactic is directly focused on helping retention or engagement. A backloaded equity package: retention. A clear team mission statement that points to the company’s: engagement. A time-scaled 401(k) match: retention. Meaningfully communicated and abided criteria for promotion: retention.

Retention is an easy metric to track, but you can start working to get engagement numbers today. Company-wide engagement surveys sent biannually allow time for leadership to get a baseline as well as six months to analyze and strategize toward improvement. Crafting a meaningful engagement survey requires its own blog post, but don’t let perfect be the enemy of the good here. Put some effort in now, and reap the reward in a few months’ time.

So the next time you hear your fellow leaders aiming for retention, ensure that the actions you are taking toward that goal are aimed at engagement. Chances are everyone will get what they want.

Dan Ubilla is obsessed with the craft of engineering management

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