Want to be 31x better at retention? Become a dynamic org

Organizations across the world are facing a plethora of challenges right now.

They are struggling to attract talent, they are worried about employee engagement, productivity and retention – plus amid a challenging economic environment, they’re feeling the squeeze on their bottom lines.

Research by The Josh Bersin Company has found the solution: so-called dynamic organizations.

These companies are three times more likely to exceed their financial targets, 20 times more likely to achieve productivity at work (in fact one dynamic organization studied unlocked a huge $21 million of productivity savings in half a year).

Dynamic organizations are also nine times better at attracting talent, and a whopping 31 times superior at retaining their talent than your standard company.

The issue is that only 7% of companies fit within The Josh Bersin Company’s definition of dynamic organizations.

Interestingly, this 7% spans different geographies, sectors and sizes – notable examples include Mastercard, Unilever and HSBC.

So, what make these companies so special? What defines a dynamic organization?

At UNLEASH World 2023, we sat down with Kathi Enderes, SVP of research at The Josh Bersin Company, to get the inside track.

What are dynamic organizations?

The 2020s has seen a shift from the information age of work to the intelligence age – this is one where CHROs take over from CFOs and CIOs as the core C-Suite role.

CHROs are no longer the policeman of the workforce or just employee champions, shares Enderes. Instead, they are true business partners and are helping companies to problem solve and have a prosperous future.

In this new era, it is not just tech jobs that are scarce (as it was in 1995 when the term ‘war for talent’ was coined, as Enderes shared on stage at UNLEASH World) – there is a wider labor scarcity.

As a result, there’s a need for companies to think differently – and this is where The Josh Bersin Company’s dynamic organizations come in.

Enderes explains that originally the team at The Josh Bersin Company was thinking of the terms adaptive or agile organizations, but that didn’t quite explain the trend. Eventually they settled on dynamic and embraced the metaphor of an orchestra.

“As an orchestra, if you want to create something beautiful, you need to know what role every person plays, but you also need to work together and adjust if something goes wrong. You need to listen to what everybody else id doing, and quickly adjust,” shares Enderes.

Dynamic organizations are “designed for change”, they are always anticipating external changes (and adapting) – and, ultimately, they move away from episodic transformation and towards continuous transformation.

Culture and tech are the differentiators

For Enderes, dynamic organizations are defined as “skills-based meritocracy”, and there are three main ways that dynamic organizations differ from other organizations.

They have a culture of inclusion, belonging and psychological safety. This is where the meritocracy comes in; everyone, no matter their role or level, can speak up, share ideas and perspectives, and ultimately drive innovation and success.

This requires a culture and mindset shift away from hierarchy, and towards the best idea winning.

Another shift is needed around the talent model, moving away from jobs and towards skills.

“Jobs are static, they’re inflexible. You try to fit a person into a job.”

Now there is a talent shortage, it’s time to bring people into the center and adjust roles based on their skills. There’s a need to move beyond training, and towards genuine skill building, according to Enderes.

The third element for Enderes is technology – dynamic organizations use tech tools in a different way.

They still have a HCM system, but they have another layer on top – whether that’s a talent marketplace or a data analytics platform – and that helps them put skills at the center.

The Josh Bersin Company’s data really shows that dynamic organizations are leading the way, and other organizations are lagging behind.

Across all organizations, currently just 14% encourage employees to advance their career internally based on their skills, 16% have clear internal hiring goals and just 6% use tech for real time insights.

Are you ready to fix these problems, and reap the rewards that come with dynamism?