As companies in Ukraine wage war for the country’s limited supply of top managers, a new survey found that personnel loyalty depends more on the company’s decision-making structure and whether employees are given the possibility to contribute to it, rather than monetary rewards alone.
The personnel loyalty survey, conducted by Forsage recruiting company and BrandAid branding company, published on May 28, showed that non-material factors have a bigger impact on top managers’ loyalty then the possibility of getting a higher salary.
“Everybody in the labor market or business today suffers from a lack of top managers and highly qualified specialists in the market,” said Olena Hryschuk, the director of Forsage. “A race for personnel is taking place and in this situation the issues of personnel loyalty and keeping top managers in companies are very important.”
The study, which was the first study of employee loyalty undertaken in Ukraine, was compiled from answers given by 123 top managers, from a nearly 5050 split between Ukrainian and international companies, including directors working at finance, sales, marketing, IT and investment companies. The questions focused on what factors they consider would increase their own and their subordinates’ loyalty.
Top managers who participated in the Forsage survey named the opportunity for career development and selfrealization as factors that determine their loyalty to the company they work for.
People are interested in working for pragmatic, independent companies that propose clear goals and move toward these goals consistently, said Lilia Mamleyeva, the managing director of BrandAid Ukraine.
Psychological and emotional factors have a great impact on whether the person will be interested in working for the company, she said, adding that “nothing makes employees as angry as inconsistency from chief executives.”
Employees want to see the company’s concern and understanding of their needs, as well as a friendly atmosphere in the team. Dictatorship and verbal abuse remain serious problems and influence personnel loyalty, said Mamleyeva.
At a company with such problems, top managers will only stay for about 1 year on average, said Hryschuk, while in a healthy workplace they could stay for 10 years or more.
“Personal contact with business owners, the ability to permanently communicate with them, the possibility to build trusting relationships, when the ambitions of the top manager and business owner coincide, are imperatives,” Hryschuk said.
Another important factor for the loyalty of top managers is the prospect for further participation in the business as a possible shareholders, she added.
Other factors top managers take into consideration are respect and care for employees, their prospects for career building, working conditions, the degree of their leaders’ transparency, a good working atmosphere and company reputation.
The survey’s findings mirror observations made by recruiting agencies, who have no shortage of clients looking to change jobs. In Ukraine’s hot job market, 90 percent of top managers are always “in transit,” said Olena Hapich, the director of Right People Management, meaning they are permanently cooperating with recruitment agencies and always on the look out for new job opportunities.
The main problem of Ukrainian business in keeping personnel is the decision making system, Hapich said.
In Ukraine, business executives transform top managers into their decision executors and don’t give them the opportunity to analyze or ask the owners why they should implement these decisions, and when the top managers want to be independent, they find another company giving them this opportunity, Hapich said.
“Being silent doesn’t mean being loyal,” Hapich said. “If the top manager sees problems in a decision, he must talk about them, and this is true loyalty.”
The second most important factor is “egalitarianism,” she said, when all employees receive the same salaries even if they gain different results.
Business executives also tend to take advantage of personnel loyalty, making the top manager loyal to them, but not to the company, Hapich added.
Yuri Solodovnyk, the director of Insight Consulting, said selfactualization is the main factor impacting top managers’ loyalty.
“The majority of top managers aren’t satisfied with their employers, but if you ask them why they don’t quit, they answer, ‘something should be done first,’” Solodovnyk said. “It is important for top managers to prove to themselves that they can achieve results.”
An employee is loyal when the management’s declared goals on company development and its mission match individual goals, added Alla Kasatkina, a business trainer and project consultant. If not, the top manager feels it, loses trust and loyalty and quits, while the company can’t always find a worthy replacement, she said.
“I have faced cases when top managers left companies and sometime later, that company lost its leading position in the market,” Kasatkina said.
