It’s Almost Christmas… is Amazon Coming to Town?

Even the best retention plan will fail if you don't first focus on culture

by Fraser Marlow

 

How well does your company compete for talent? It’s a timely question given 238 cities are vying for Amazon’s new second headquarters (HQ2). Have you considered what would happen to your retention rates if 50,000 new positions opened up down the road, at a company with a recognizable brand and an aggressive growth trajectory?

While some might consider Amazon a retailer, the skills they seek in their hires aren’t those of a big-box store. They want technical talent and lots of it. They want software developers, product marketing gurus, designers, and system engineers. These just happen to be the very same folks most companies struggle to hire in today’s competitive market.

Analysts point to the impacts of so-called “agglomeration” – the snowball effect of such a concentration. Many other service providers and tech companies are likely to gravitate around Amazon’s HQ2. In Seattle, in addition to Amazon’s 40,000 highly-paid tech jobs, another 53,000 are estimated to have been created or moved to the city as a result [read more on this].

If your city is chosen … 

You better watch out

You better not cry

You better not pout

I’m telling you why

Amazon is coming … to town

How can you protect yourself from losing the valuable talent you’ve fostered and invested in over the years? Here are some ideas to help protect retention.

With 238 proposals from 54 states it is actually easier to list those who have not pitched to Amazon: Vermont, Arkansas, the Dakotas, Wyoming, and Montana.

Throw in most of Mexico (except Chihuahua, Hidalgo, and Oro), Saskatchewan, and anything north of the 60th, and you have a complete list for all of North America.

To retain your staff, focus on culture

Amazon faced criticism of its corporate culture and suffered an ugly bruise as a result. According to a 2015 exposé by The New York Times, the Amazon culture was vicious and unforgiving (see “Inside Amazon: Wrestling Big Ideas in a Bruising Workplace”).

The claims did little to dent their growth, but like most aggressive companies, Amazon has a culture that won’t work for everyone. Companies that want to fend off Amazon and maintain retention rates need to highlight the positive aspects of their culture.

In the wake of bad culture press, Amazon has launched a charm offensive, working feverishly on its internal culture and external reputation. Its Glassdoor score has improved from a 3.4 to a 3.7 (out of 5). Still, Amazon is having a difficult time trying to persuade some that it’s a great place to work for those seeking work/life balance.

So what does your culture have to offer that workers won’t find at Amazon?
Know your culture’s strengths and the values you represent – and amplify these. Strengthen your organization’s social fabric through peer recognition and collaboration.

Pay attention to work-at-home or isolated talent

According to a study by GlobalWorkforceAnalytics.com, working remotely is an option for roughly one in two workers in the U.S. – and certainly for the vast majority of workers Amazon wants to hire. But while Amazon posts close to 200 work-from-home jobs on it’s recruiting site, it would not build a large corporate center just to have its 50,000 employees sit at home.

What if you have skilled remote workers living in the vicinity of the new HQ2? Which work environment will be most attractive to them?

Studies suggest that younger workers prefer the community of an office environment. And this makes sense. As workers develop their careers and learn from others, being deprived of direct access to team members leaves them feeling isolated and stagnant.

But in truth, most employees want the best of both worlds: both an office where they can work and socialize, plus the option to work remotely when it suits them.

If Amazon offered an engaging, creative, and cool work environment similar those at Google, Facebook, and Yahoo!, will they poach your remote workforce when you’re not looking?

Pay attention to your employees who work from home. Invest more time in communication and connection. Make sure the future direction of your organization is well communicated and employees feel involved. Create opportunities for them to interact with a number of people at home base, including senior leaders.

Other impacts on employees’ lives

The HQ2 debate raises issues about the impact Seattle is feeling from hosting HQ1. The company has about 40,000 employees in that location, which is up from 5,000 in 2010, according to the Seattle Times.

This concentration comes with great benefits to the city: an influx of talented workers, a booming hip city scene, and a windfall of tax dollars. But it also comes at a price. The rising cost of housing and a strained transportation network are two top grudges. “Amazon so dominates Seattle that it has as much office space as the city’s next 40 biggest employers combined”, the Times writes. This demand was built up over almost two decades. HQ2 will most likely require a $5 billion campus that will pop up in just a couple of years.

If you want to protect your organization from the disruption of HQ2, encourage managers to get to know their team members better. Where do these folks live?  What are their future ambitions?  What are their commutes like?  Do they own or rent their homes?  Do they feel financially secure?

Developing a keen sense of what matters to individuals will help you better anticipate potential issues before it’s too late.

Whether Santa brings you HQ2 or not …

The economy is thriving. Unemployment is at a record low of 4.1%. Employees are quitting their jobs at a rate we haven’t seen since the great recession of 2007. Whether Amazon selects your home city or not, the vitality and survival of your organization depends on 1) the strength of your culture, and 2) how connected your employees are to the core purpose of the enterprise.

Be proactive and use the impending HQ2 reveal as a fire drill:

  • How healthy is your culture, and how engaged are your employees?
  • Is your culture a competitive advantage? If so, articulate it well and ensure every employee senses that strong bond.
  • Does everyone feel included, from the senior leadership team to the satellite offices and work-from-home staff?
  • Do managers really know their team members on a personal level, enough to anticipate and head off issues that may cause them to leave?

To put a spin on Peter Drucker’s well-known quote: Culture already ate strategy for breakfast #CultureAteStrategy Click To Tweet

Even the best business strategy will fail unless you first establish a culture that protects you from disruptions in the market. Amazon’s HQ2 is just one of those bumps you can expect in 2018.