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Why Are We Losing All Our Good People?
by Edward E. Lawler III
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How can Sambian discover what’s really driving people out the door?
Reprint R0806X
HBR C
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Why Are We Losing All Our Good People?
by Edward E. Lawler III
harvard business review • june 2008 page 1
HBR’s cases, which are fictional, present common managerial dilemmas.
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Sambian Partners has prided itself on being a great place to work, but
now talented employees are leaving. What’s going on?
Mary Donillo, the head of human resources atSambian Partners, motioned Tom Forsythe,Sambian’s assistant director of commercial de-sign, to a comfortable chair in her office. It waslate on a Thursday afternoon, and the Chicagosky looked like slate. The darkness outsidemade the overhead fluorescent lights in heroffice seem even more glaring than usual.
“Hey, Tom,” she said, adding an extra bit ofwarmth to her voice. “I was so sorry to hear thatyou’ve decided to leave. I know your mind ismade up—everyone’s already tried to talk youout of it. But I do hope you can help us under-stand why.” She paused and offered a ruefulsmile. “It’s a huge loss, but maybe we can learnsomething from it.”
Tom sat stiffly in his chair, one side of his facepartially covered by a few strands of dark hairthat had escaped his ponytail. The lightsbrought out the bags under his eyes, and hisfive o’clock shadow looked more like a seven.
With a newborn at home, he probably hadn’tbeen getting enough sleep, Mary thought.
“Well, I think you know that I wasn’t outlooking,” Tom said. “Their headhunter came tome, and, what can I say? It’s an offer I couldn’trefuse. I mean, a direct-admit partnership toJ&N? It really is an opportunity that doesn’tcome along often.”
Mary couldn’t help blinking at the mentionof J&N, Sambian’s much larger competitor. Inthe past year, it had seemed to step up itsraids on Sambian’s talent pool, luring somevery capable people over to “the dark side,” asSambian’s CEO, Helen Gasbarian, liked to callit. “I’m glad for you,” Mary managed to say.“Although I wish it were anywhere else.”
“I know.”Mary studied Tom’s face for a moment, won-
dering how to press for more. No unplanneddeparture was good news, but this one was re-ally setting off alarm bells. Tom was at the top
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of his game; at 35, he’d been with Sambiannearly eight years. The company had beenlike a family to him, even after he got marriedand had children. He’d won a slew of designawards, and he was on the CEO’s short list ofhigh performers. Mary could see the attrac-tion of a partnership position. But was thatthe whole story? At Sambian, Tom enjoyedthe same kind of authority he would have atJ&N, if not more. He chose his projects, sethis own priorities. Did he know how hard itwould be to earn that kind of autonomy at anew firm, partner or no?
“I’m sure it’s no news to you that you werecoming up for promotion,” she ventured. “Ifnot this year, then maybe the next. Would ithave made a difference if the raises had beenbigger? For that matter, would it make a dif-ference now? I mean, there’s no shame inreconsidering—you really are highly respectedhere, you know.”
Tom looked at his hands. “It’s nice to hearthat, Mary,” he said. “But of course I’ve alreadyaccepted. And anyway, it’s time to move on. Ihave to challenge myself, keep it fresh.”
“But you’ve always managed to keep itfresher than just about anyone. Are theprojects themselves less challenging thesedays?” She avoided the obvious question:Have you been unhappy?
Tom tilted his head and looked directly intoMary’s gray eyes, as if reading her thoughts.“I’ve been very happy here,” he said. “Thepeople are great. I’m not running away fromanything. It’s just that a fantastic opportunitycame along at a good time.”
Mary kept probing, asking all the standardquestions, but Tom demurred, merely repeat-ing what he’d already told her. By the timethe interview had ended and she’d seen himto the door, she felt deflated.
After leaving her office, Tom headed intothe back stairwell, pulled out his cell phone,and speed-dialed his wife.
“Alyson? Hey. Yeah. You’ll be proud of me—I kept my mouth shut. I mean, you’re rightabout not burning bridges, but who cares atthis point? This place can be as screwed up as itwants. It’s not my problem anymore.”
An Unhappy Memo
Early the next morning, Mary tapped onHelen Gasbarian’s door. She found Helen star-ing at her computer screen, frowning. There
was nothing Helen hated more than losingstaff to J&N, and it showed plainly on her face.
“Working on the memo?” Mary askedgently.
Helen nodded. “Not much fun. I was justgoing to send it to you so you could look itover. How’d the exit interview go?”
Mary confessed that Tom hadn’t revealedmuch. “He didn’t want to get specific aboutwhy the grass is greener there or tell me aboutanything that made him unhappy here.”
When Helen’s father, Peter Gasbarian,had founded Sambian, in 1975, it was sup-posed to be the antithesis of a behemothlike J&N. His idea was to build a top-notcharchitecture and engineering firm by mak-ing appealing offers to young talent. Ratherthan spend years as anonymous “leverage”to fat-cat partners, young people at Sambiancould start making their mark immediatelyon interesting projects. It was no coinci-dence that he had stopped mulling this ideaover and turned it into reality after his onlychild announced she was applying to archi-tecture school.
It was also no surprise when Helen tookthe reins following her father’s death, in1997. By then an award-winning architect inher own right, she made it her mission toincrease collaboration among the firm’scutting-edge designers, engineers, and clientaccount managers. As a result, innovationhad flourished in general—and, in particu-lar, the firm had been in the vanguard of the“green building” movement. By the timeother, larger firms were just starting theirgreen practice groups, Sambian had alreadydesigned dozens of LEED-certified buildings.Riding the growth wave, the company hadopened offices in San Francisco, New York,and London.
Helen looked hard at Mary. She wishedshe could put the blame for losing Tomon her—or on someone, anyone—but shecouldn’t. “You know, ever since Dad foundedthis company, we’ve tried to make it a greatplace to work,” she said, sighing. “And I thinkwe treat people really well. Where are wegoing wrong?”
“I don’t know, honestly,” Mary replied care-fully, hearing the bewilderment in Helen’svoice. “But I want to be careful about not read-ing too much into this. Obviously, we need toget to the bottom of it, but it might turn out
Edward E. Lawler III
([email protected]) is the Distinguished Professor of Business at the University of Southern California’s Marshall School of Business and the founder and director of the university’s Center for Effective Organizations. His latest book is Talent: Making People Your Com-petitive Advantage (Jossey-Bass, 2008).
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that it’s not a trend, just a nasty coincidence.People leave jobs for all kinds of reasons.”
Helen pondered the point. “Well, that’strue enough: Pat Dougherty moved to Ireland‘for family reasons.’ Irena Milkovic decided togo solo—I’m still trying to figure that one out.And now Tom, to a partnership at a big tradi-tional firm.” She shook her head. “But the factremains that it is a trend. I want to knowwhat we need to do to keep the rest!”
“I have a few theories, Helen,” Mary said, assoothingly as possible. “But to see whetherthere’s anything to them, I’d like to move thisyear’s employee survey up on the schedule. Ithink we need to get some new data in frontof us.”
Helen turned back to the computer. “Yes,do the survey,” she said. “Do it as soon as youpossibly can.”
The Word on the Street
Designer Hal Pope and engineer SavannahDorsey were two floors down in Sambian’slarge kitchen, heating up their lunches in themicrowaves. They were both subdued, havingread the memo bearing the news of Tom’sdeparture.
“Tom sort of checked out when we lost thatMarko bid,” Savannah ventured. “He reallywanted to see that design get built. It was gor-geous, with all that light and air. And anyonecould see that the price was right.”
Hal agreed. “The design couldn’t have beenbetter.” He lowered his voice a little. “If onlyPaul Bonney had been able to point that out.”
Paul Bonney was the head of architecturesales. Savannah stared at Hal. “You thoughtso, too,” she said. “His pitch sounded so, well,uninspired.”
Adrienne Perle, another colleague fromengineering, couldn’t help overhearing asshe reached past them for some utensils. “He’suninspired,” Adrienne said. “And he’s not theonly one. It’s really a pity when you havesomeone doing incredibly creative work, andthe support structure isn’t there to let itsee the light of day. All the salespeople focuson is cutting the deal. If you ask me, that’swhy Tom is leaving. He’s a first-class architect,but if he doesn’t have first-class sales and mar-keting behind him, he’s no one. He’s the treefalling in the forest. I’ve tried telling peopleupstairs that we’re veering off base. Butnobody’s listening.”
Hal shook his head. “I don’t know, guys. Tomhad plenty of wins. More work than he couldhandle. I just think he looked above him andrealized he was going nowhere fast. No one onthe executive team is even close to retiring,and the org chart is top-heavy as it is. Where’sthe career path?”
Adrienne pulled a sour face, indicatingagreement. “I wonder how much he’ll makeas a partner at J&N? It could be as simple asthat. Two kids now. He’ll be worrying aboutcollege funds.”
Savannah jumped back into the conversa-tion. “True, but you’d think he’d also beworried about quality of life. I guess Alysonmust have decided not to go back to work.They’ll have him on the road constantly.”
This Is Not a Drill
A month later, Helen was scanning a staffutilization report when the phone rang. Thephone’s display showed that the call was com-ing from Bob Wortham, the vice president ofengineering. Through the open door, Helensaw her assistant, Jessie, move to pick it up ather own desk.
“I’ve got it, Jess,” she said, lifting the receiver.“Hi, Bob. What’s up?”
“I might need your help on something. I’mafraid we’re at risk of losing Adrienne. It’sjust a rumor so far, but I want to jump onthe situation.”
Helen grimaced. “Adrienne? You’re right—we don’t want to lose her. Why don’t you comeup now?”
Hanging up, Helen called out to Jessie. “Canyou see if Mary is free? If she can make timeright now, that would be great.”
She stood up, walked over to the window,and pressed her forehead against the coolglass. On the plaza below, a few late lunchersclustered around a vendor’s stainless-steel cart.She closed her eyes. Another loss for Bob, shethought. Was he part of the problem? Sheshook her head, refusing to pursue that line ofthought. The best way to decrease attritionsurely couldn’t be to fire loyal employees.
In the hallway outside Helen’s office, Bobran into Mary. As he relayed the rumor aboutAdrienne, Mary felt the blood start to drainfrom her face.
“It’ll be a real problem if we lose Adrienne,”Bob said. “She’s in the thick of a huge project,and the client loves her.” He gave Mary a hard
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look as they passed Jessie’s desk. “What’s goingon here, anyway? It’s like our talent is beingsucked out by vampires.”
Hearing them enter, Helen turned awayfrom the window. “OK, Bob,” she said. “Whatexactly is this rumor?”
“People are picking up a vibe that she mightfollow Tom to J&N,” Bob began, pulling thedoor shut. “The two of them were kind of on awavelength. It wouldn’t surprise me if hewanted to find a home for her there.”
Helen shot a look at Mary. “No noncom-pete?” Presumably, Tom had signed the stan-dard contract preventing him from takingtalent or clients with him to the competition.
“Oh, sure,” Mary replied. “Tough to enforce,though,” she added, immediately wishing shehadn’t.
“Oh, I’ll find a way,” Helen spat. “Even if Ican’t win, I can make life tough for him.”
Mary and Bob exchanged glances. Helenturned to Bob, on the offensive now. “So you’retelling me we shouldn’t be surprised, but I’malso getting the sense that you haven’t doneanything in anticipation of this.” She couldn’tresist adding a swipe at Mary. “And why areyou waiting around for the satisfaction surveyresults before taking any action?”
Mary opened her mouth as if to object, butHelen waved her hand impatiently. “OK, look,”she said. “I’ll talk to her. Let me see what I cando.” She walked to the door and opened it.
“Jess, call Adrienne Perle and ask if she’savailable. I want to see her as soon as possible.”
Oh, Won’t You Stay?
Ten minutes later, Adrienne appeared inHelen’s doorway. Her heavy-framed designerglasses made it a little difficult to read the ex-pression on her face, but her body languagesignaled anxiety. It wasn’t every day she wassummoned to the CEO’s office.
A few moments of small talk prolongedthe awkwardness, but Helen got to the pointas quickly as possible. “Adrienne, I’ve heardan alarming rumor—that you might be con-sidering a job elsewhere. I certainly hope thisisn’t true.”
Adrienne looked down at the coffee tableand then around the room as if to see whomight have spilled the beans. “Rumors spreadfast around here,” she said finally.
“I want you to tell me the truth—in totalconfidence, no repercussions,” Helen said
pleadingly. She paused for effect. “Is TomForsythe talking to you?”
Adrienne’s eyes widened slightly, and her an-swer seemed, to Helen, a little too quick. “Tomhas nothing to do with this,” she said. “I mean,it’s true that I talk to him. We’ve known eachother for a long time—since I got here, fiveyears ago. He’s probably the closest thing I’vehad to a mentor. And I guess I do feel a littlelost now that he’s gone.”
“Well, my job is to make sure that you don’tfeel lost. We really value you around here,and I want you to be happy. I don’t want youto even think about leaving.” She paused. “Isit possible that Bob could play more of thatmentoring role?”
With an uncomfortable shrug, Adriennebegan formulating a careful response.“Well, it’s not so much, um...” Her voicetrailed away.
Helen let her off the hook. “Well, let’s fig-ure out how we can fill that void.” It was clearthat Adrienne wasn’t being totally forthcom-ing but impossible to know how much shewas withholding. Of course, she would knowbetter than to say that Tom was recruitingher, even if he was. Recalling Bob’s note ofdesperation earlier, Helen made a decision.“In fact, maybe you would let me play a littleof that role myself. I’m promoting you.”
Which Is Worse?
“Helen, you can’t do that! Adrienne’s onlya level-six employee—she’ll drown in thatposition.”
Helen had known that the suddenness ofher executive decision would not sit well withMary, but the intensity of Mary’s reaction sur-prised her. She had, after all, succeeded inkeeping Adrienne on board. “Desperate timescall for desperate measures,” Helen offered inher own defense.
“But that’s just it,” Mary cried. “It will looklike an act of desperation to anyone whoheard the rumor. And worse than that, it isn’tfair. If that job is available, there are otherpeople who should get a crack at it. It’s notright that they should effectively be penalizedbecause they were the loyal ones. What kindof signal does that send?”
“I’ll tell you what signal I think it sends. Ittells people that we aren’t so constrained byHR procedures that we can’t make exceptionsfor fast-rising talent. That’s a positive message.
“We really value you
around here, and I want
you to be happy. I don’t
want you to even think
about leaving.”
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And as for Adrienne, don’t worry about her.Everyone loves her. She’ll step up to the plate.”
Mary shook her head. “It’s not a question ofpopularity or attitude. She’s missing some ofthe competencies...”
“Well, aren’t we all!” Helen interrupted.“Sometimes I think we focus too much on thethings that aren’t quite perfect. If Adriennewere on the outside and sent us her résumé,we’d say she was perfect for this job. Tell methat’s not true.”
The Voice of the People
A few weeks after the tense encounters overAdrienne, Mary tapped again at Helen’s door.
“Survey results time,” Mary called out in asingsong voice, glad that she and Helen wereback on a happy footing. She sat down acrossthe desk from Helen and handed over a copyof a chart-saturated report. “I’ll give you thebig picture first. Overall, people at Sambian arequite satisfied with just about every aspect oftheir employment experience.”
Helen groaned.“I know, I know,” Mary continued, “but
once you get into the details, there are somenuances.” She offered a few examples of de-partments whose results diverged from theaverages. And, as always, the open-endedquestions had yielded food for thought. Com-menting anonymously on their survey forms,a few employees had complained of toomuch deadwood in the project managerranks. One staffer referred to “certain prima
donnas” who cared more about winningawards than staying on budget. The adminis-trative staff was, for the most part, neutral.Some resented the evening and weekendhours they spent when, as one phrased it,“someone higher up the chain procrasti-nated.” The perks were good. The perks werebad. The perks were skewed to the youngeremployees. The younger employees didn’tfeel valued enough.
Helen listened for 20 minutes, saying littlebut shaking her head frequently. Then, whenMary was in the middle of reading a commentabout the snack and beverage choices in thekitchen, she interrupted.
“Oh, that one was mine,” she joked.Mary played along. “I thought so. And don’t
worry, I’m on the case.” But she knew the bosshad heard enough for the moment. Closing thereport cover, she leaned back in her chair. “Iknow it’s hard to separate the signal from thenoise here, but at least it gives me some moreideas about what to probe for when I’m talkingto people one-on-one.”
“And that might be enough,” Helen said, “ifonly they would give us straight answers.”
How can Sambian discover what’s really
driving people out the door?
Reprint R0806X
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