HUMAN RESOURCES SECTOR
An exit strategy is a contingency plan that is executed by an investor, trader, venture capitalist, or business owner to liquidate a position in a financial asset or dispose of tangible business assets once predetermined criteria for either has been met or exceeded.
Comprehensive exit planning strategy includes the following basic components:
Owner's Goals and Objectives.
Value Driver Analysis.
Value Enhancement Opportunities.
Exit Options Analysis.
Tax & Net Proceeds Calculation.
Business Exit Strategy and Liquidity:
Different business exit strategies also offer business owners different levels of liquidity.
Selling ownership through a strategic acquisition, for example, can offer the greatest amount of liquidity in the shortest time frame, depending on how the acquisition is structured.
The appeal of a given exit strategy will depend on market conditions, as well; for example, an IPO may not be the best exit strategy during a recession, and a management buyout may not be attractive to a buyer when interest rates are high.
Exit Strategy in HRM:
Similar to onboarding, a successful offboarding strategy will include a combination of tactical and strategic elements.
Organizations must consider not only compliance issues that surface when employees leave but also a way to engage former employees beyond their last day of work.
Below are several strategies that organizations might want to consider when saying goodbye to top talent, including establishing alumni groups, implementing an enterprise strategy, balancing standardization with customization, and investing in technology.
Develop alumni groups.
Alumni programs are powerful tools to improve recruitment strategies, provide insight into employee engagement, and even expand the business.
In fact, Aberdeen recently conducted a qualitative interview with a professional services organization that gained $1 million in new business through a member of the alumni who became a customer.
Although many former employees have been spearheading these groups, employers need to take a role in creating, managing, and cultivating these programs.
Currently more than 50 percent of organizations are leveraging or planning to leverage alumni sites.
Companies can participate in social media discussions, create portals for engaging alumni, and provide information on job opportunities, corporate social responsibility and additional incentives.
Employee referral programs.
Since employee referral programs are often considered the most effective recruiting tool for sourcing talent, organizations should consider expanding these programs to include alumni.
Organizations should include alumni in employee referral communication strategies and also provide former employees with the same incentives they would provide existing employees.
So-called boomerangs are former employees who have been hired back into the organization.
Leading organizations are actively expanding their talent pools and engaging with both active and passive candidates.
They also need to be able to differentiate top talent from underperformers and make sure that those individuals are candidates for rehire.
Organizations need to treat their alumni with the same level of attention and support that they show their customers.
With social media on the rise, a poor alumni strategy can negatively impact the employer brand and directly impact the bottom line.
Consider the full picture.
Offboarding is most effective when it is implemented across the entire organization and includes retirees and both voluntary and involuntary separations.
Without a consistent approach for exiting employees, organizations will have little insight into why employees are leaving and what needs to change in order to improve retention and engagement.
An enterprise-wide approach to offboarding requires organizations to step outside of their comfort zones and accept both positive and negative feedback.
Currently, the majority of organizations are focusing solely on voluntary separations (70 percent), rather than involuntary separations (19 percent) or retirees (10 percent).
Balance standardization with customization.
Organizations have a tendency to swing back and forth between standardization and customization in the offboarding process.
They either create one consistent process for every individual in the organization or customize the offboarding process to meet the individual needs of various job roles, business units, and even generational groups.
Overall, organizations need consistency in the development, implementation, and evaluation of offboarding but should also consider tailoring this approach to different groups in the organization, especially when considering a global organization.
Invest in technology.
Development of technology can have a dramatic impact on an offboarding strategy, not only to ensure compliance, but also to provide a way to engage rehires.
A few examples of how to automate the offboarding experience include exit interview surveys, workflow automation, and the establishment of alumni portals.
Although several solution providers are now offering offboarding products, the majority of organizations still have a manual process in place (62 percent) compared to 32 percent of organizations that have partially automated the process and 5 percent with a fully automated process.