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Today’s marketplace is incredibly competitive in every industry around the globe. The difference between success and failure is talent, period – Indra Nooyi (Former CEO, Pepsico)
Hiring the best talent is undoubtedly the most crucial part of ensuring your startup’s success. It involves investing much time, money, and effort from shortlisting candidates to onboarding the best ones. Whether you have hired your first batch of developers after the Series A funding or scaled up after the Series B funding, losing these candidates cannot be an option for you.
Failure to retain the best talent results in failure to achieve a product-market fit within the desired timeline. It may force startups to extend their runway, which in most cases, is not feasible. The result – project delays, rework, and even failures! That is how devastating it could prove to your startup. For startups, talent retention is NOT always about maximizing profits; it is about survival.
Talent retention challenges in startups
Hiring candidates that are a perfect match for your organization and then retaining them may be two sides of the same coin. However, the challenges that talent retention throws at startups and established organizations differ greatly.
Talent retention for startups running on a bootstrapped budget is a different ball game altogether. They lack resources, their business models may not be proven, and stable revenues are out of sight. Hence, they cannot pay handsomely or offer lucrative perks like their well-established counterparts.
Why employees leave
You would often hear phrases like, “Our workforce is our most valuable asset.” However, if you see how employees are mistreated in most organizations, you realize that this is only a common saying.
Restricted professional & monetary growth, poor work-life balance, and unfavorable work environment are the primary causes of employee attrition. Presently, the nature of jobs has started shifting from being employer-centric to employee-centric. This has put employees in the driver’s seat with better offers rolling out each day.
Consequences of failure to retain talent
Failure to retain talent may lead to unfinished projects and losses in terms of time & money as discussed above. But the most frustrating part is going through the process of finding the best talent all over again, and of course, retaining it. So, putting talent retention on the back seat is anyway NOT an option for you even after you rehire. After all, retention programs are cheaper and easier when compared with replacement programs!
Talent Retention (in theory)
Talent retention has two crucial aspects – transactional and psychological.
Transactional: This involves understanding what expectations candidates have from the employer in terms of monetary benefits, flexibility, and work culture.
Psychological: Here, you need to figure out what engages employees and motivates them to do their best.
In the end, it all boils down to this one question you need to ask yourself, “Why would engineers want to work for your startup?”
Talent Retention (in practice) for startups
How much ever you talk about the psychological aspects of talent retention, the fact remains that in most cases, transactional aspects outweigh the psychological ones. Thus, a smart way to go about it is building an offshore team in India or finding an offshore software development firm that can help you out.
India is home to the best tech talent in the world! And, the best part is, you can hire a software developer in India at a salary that is almost five times less than that of a software developer with the same years of experience in the U.S. Thus, you will not have to hesitate even when it comes to rewards & recognition or promotions & increments although you are running on a bootstrapped budget.
In today’s times, employees give much importance to work-life balance. Excessive workload will put your workforce on the backfoot. Building an offshore team will further ensure that the work is well-distributed while simultaneously facilitating round-the-clock operations. This will create a win-win situation for your startup as well as your onshore & offshore team.
Hiring and retaining talent is surely a major problem for startups. And amidst the tech talent crunch (rather a war), it becomes difficult to retain good talent and maintain the stability of the newly found startups. In such a situation, offshoring comes as a relief with cost-saving and high-quality talent. And, in countries such as India, where policies and infrastructure are readily available, it becomes cherry on the top!