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I was speaking recently with a friend who is a Head of People at another company. In the course of our conversation the topic switched to retention. I shared Plastiq Engineering’s retention record – we have had only 1 Engineer depart the company in nearly 2.5 years. Our average tenure of an Engineer at Plastiq is currently 3.3 years. My friend was shocked at the figure, and cited that the average tenure of Engineers at established firms is much lower (1-2 years), referencing a study from Paysa released in late 2017. Our conversation on the topic of retention encouraged me to write this post to share (a) how we have done it (it takes effort) and (b) why it is important to us (the effort is worthwhile).
I’ve spoken on the broader topic of Talent Management at a number of industry conferences over the years. Talent Management to me is 3 components:
In competitive talent markets like San Francisco, there are always “cool” companies looking to hire great engineers and willing to give them a salary increase and a signing bonus to jump. How do you compete with that? Well, Engineers, in my experience, are not solely motivated by money. Compensation is not really a motivator for your employees (one of my favorite books, Douglas McGregor’s classic “The Human Side of Enterprise”, 1960, explains why), though it can be a demotivator if they feel they are not being compensated fairly relative to market. What I have found really motivates great Engineers is getting to work with other smart Engineers, working on really hard technical challenges and receiving opportunities to grow their skill set and expand their capabilities – essentially disincentivizing the need to “look outside”. If working at one company is “like getting a new job every 6 months”, then you don’t need to look outside.
At Plastiq, we have invested a lot in our Engineers to give them great learning and growth opportunities. We send out team members to conferences and encourage them to network at local Meetup groups and events. We use our 20% rule (where 20% of our team’s monthly capacity is devoted to internal Engineering work) to give us the opportunity to work on new technologies and reduce technical debt (which ultimately benefits the business, but that’s a story for another blog post). We let our Engineers set out their learning goals and then line them up with projects that give them an opportunity to learn. We’ve encouraged our Engineers to tell us what role they want and then support their transition to that role – for example, our “Chief Architect” at Plastiq started as a “Software Engineer in Test”, and many of our full stack Engineers joined us initially as specialized UX Engineers. We use our War Room Wednesday construct to bring the entire team together to learn a new skill/technology or solve a challenging technology problem, together. These are just some of the steps we take.
All of these steps take effort. We have to commit to allocating an Engineer’s time (which otherwise could be used to directly deliver new product features) to all these activities. We need to be willing to sacrifice optimal resource allocation in order to give our Engineers a chance to learn and grow their skill set. We need to be willing to lose someone (e.g. our “Software Engineer in Test”), backfill for them and support them in moving to a new role.
Why do we do this? Existing employees are tremendous assets as you scale – your great individual contributors of today become your leaders of tomorrow. For Plastiq, as we rapidly hire more team members (I fully expect our average tenure will go down sharply as we accelerate our hiring of Engineers in 2019), its critical that our mature and impactful employees remain on board as we grow. From building software over the last 15+ years I have learned that you may not know exactly what roles you will need 12 months down the road, but you enhance your chances of filling them quickly when you have a pool of seasoned existing employees that may move into those future pivotal roles as they emerge.
I will conclude by sharing a quote from one of our team members from a recent internal survey, where we asked “How does working at Plastiq compares to your previous work experience?”. To me it summed up what I strive for:
“A big difference that has kept me engaged at Plastiq (and kept me from seeking jobs elsewhere) is the ability to move internally to new projects and technologies that interest me. Leadership has been extremely open to team members taking on new tasks, and trusting them to learn as they go if they aren’t subject matter experts in those new areas.“