VideoStephen Aday, controller of Cellular One of San Francisco, has managed to hold the turnover rate in his finance department to about 21 percent. Too high, you say? It could be much worse, according to Aday.
After all, Cellular One, a digital wireless service provider that began as a joint venture between AT&T Corp. and AirTouch, doesn't offer stock options. That's a big minus in Silicon Valley, where the overall turnover rate is about 20 to 25 percent, and where experienced finance staffers are hot properties.
Also, Aday's department had embarked on a cost-cutting program three years ago, called The Finance Challenge. As a result, head count dropped 23 percent, largely through attrition. "Not exactly the message you want to send out these days," Aday dryly remarks. The Finance Challenge came to a screeching halt in the second quarter of 1999, when word came of Cellular One's impending acquisition by AT&T Wireless. Aday realized the merger would create uncertainty that would inevitably lead to a mass exodus from the finance department unless something dramatic was done.
"We said, 'The Finance Challenge is over — good riddance,' " recalls Aday. In its place is a new program, dubbed Finance 2000. "Our mission is to build a work culture that meets the needs of employees in an uncertain environment." The new program has kept turnover from soaring even higher, he says.
Meeting the needs of finance employees is something turnover-weary companies are striving to do these days — and not just in Silicon Valley. National unemployment hovers near 4 percent, while the flurry of start-ups everywhere has dramatically increased the demand for financial leadership. The slump in the stock markets has sunk many stock options, the golden handcuffs that are supposed to keep employees in place. Throw in the rise of the free-agent workforce, and you've got an employee-retention problem on a nationwide scale.
Of course, any company is going to have trouble retaining employees if it can't convince them that its business model is sustainable. But these days, more than ever, CFOs need to promote a corporate culture that values and rewards finance staffers — even if the rewards aren't always monetary.
Pushing Finance Buttons
Cellular One's new finance program was launched not a moment too soon. The AT&T Wireless acquisition was completed at the end of June, and uncertainty is the word of the day. Fortunately, Aday was able to implement a number of his Finance 2000 initiatives before the sale was complete. The program focuses on creating learning opportunities, blending home and work life, and creating a fun work environment.
Conspicuous by its absence from Finance 2000 is the word "compensation." "None of this is about compensation or shaving expenses," says Aday. "Every single one of us could leave for more money and a promotion tomorrow. It's the work environment that's keeping me here. It's the soft stuff, not the options."
Aday and his senior finance staffers brainstormed about what would make Cellular One of San Francisco a terrific place to work, and he says that they tailored the Finance 2000 program for "a finance psyche."
"We tried to figure out what pushed finance buttons," he explains, adding, "a lot of this stuff wouldn't work for engineering and IS." High on the list of buttons were training, professional development, recognition, and balance. "In finance, you toil away at your desk all day, but you don't get that much recognition." Cellular One's finance department now has five different recognition programs, says Aday, including the Star Awards, in which outstanding staffers are eligible for prizes; and the X Awards, which recognize quality achievements and allow winners to give presentations about their activities to finance managers.
Aday also put Cellular One's money where its mouth was. He doubled the budget for training programs and put special emphasis on cross-training within a variety of finance disciplines. In addition, he created a training matrix for each employee, which was filled in as employees completed various assignments.
Aday also began advocating alternative scheduling arrangements to foster a better balance between work and leisure time. This involved asking employees what their ideal schedules would be, as long as they worked 40 hours per week. "There was some internal resistance to this," says Aday, but the controller made it clear he was 100 percent behind the new, flexible scheduling; any finance manager wanting to make an exception had to explain why.
Training, development, and retention benchmarks are now part of finance supervisors' performance evaluations, says Aday. Although Cellular One of San Francisco's current retention figures are still not great, Aday is very happy with the program. "Our employee satisfaction has improved, and we have an identity about what kind of internal environment we can offer now."
The Implicit Contract
Creating that environment, say experts, is the only way to ensure long-term employee retention, especially in today's market. Many companies have relied for too long on high salaries and options incentives, and have neglected the basic thing that makes people care for and stay at a company — the implicit contract between employer and employee.
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