Employee loyalty programmes: a Band-Aid® for a gaping wound

South African companies are not only competing within a national context for top-tier software talent but they are also up against international organisations on their own soil. These organisations have cut their teeth in far more competitive markets and have decades of experience in managing software environments on the South African companies. It is not breaking news either that there is a very limited pool of skills to draw on, and to top it off, in South Africa, there is a through-the-roof demand on enterprise developers in all sectors. This dangerous combination and a heavily imbalanced supply-and-demand picture has forced software-service companies and corporates to take a closer look at their retention rates and invest in programmes designed to improve these figures, or suffer churn as the talent is pulled towards the highest bidder.

The problem with this approach is that companies are designing loyalty programmes to mitigate that fact and as a result, they avoid the tough questions that examine the organisational causes of staff churn. When used in this way, loyalty programmes are the equivalent of sweeping the problem under the carpet. They cannot solve fundamental, underlying issues that require investment and political will to transform, much in the same way that a Band-Aid cannot stop arterial bleeding. Giving employees a free smoothie is not going to keep them working for you, let alone engaged with their work if they have a poor relationship with their team, have very little input, control or ownership of their work, or work in the basement of a dilapidated building with poor ventilation.

The power of a loyalty programme lies in its ability to enhance what is already a working organisational culture, and to incentivise positive behaviour. Loyalty programmes are incredibly useful tools for this purpose and the benefits of this approach have been well studied and documented, some of which you can read about on the Encentivize website.

So how then do we, as the businesses who depend on these individuals, move ourselves into the future with a predictable strategy for retaining and attracting top software talent? The answer is not easy, nor is it the same for everyone in the game. However, at Entelect, we know that it begins with self-reflection. For a retention programme to be effective, it cannot simply be a rewards system. At worst, it needs to be a comprehensive overhaul of the organisational culture, processes and management practices of a company. We have identified some common success factors within teams that have high retention rates and although not universal, there is generally a shift towards empowerment, autonomy, transparency and inclusivity in all the teams.

Knowing where to start can be tricky. In our business of software services, customers and staff are two sides of the same equation and success is an exercise in identifying our value proposition for our staff, and working just as hard to balance that equation as we do for our customers. Embarking on this journey has taught us that retention in the world of software development means taking a long hard look in the mirror at who you are as a company and committing to improving yourself, for your staff.