Retaining essential talent is a growing concern for HR professionals, especially in a tough recruitment market. One solution for businesses is key person insurance, which offers financial protection if a crucial employee faces serious health issues or passes away. But there are also proactive steps businesses can take to manage the risks of losing vital team members.
Identifying Your Business's Key Players While senior leaders often hold significant knowledge and influence, it's essential to recognise that expertise can be found at all levels. Every company has hidden gems – those employees everyone turns to for advice or relies on to get things done.
In smaller businesses, this might be the owner or a pivotal employee, like a salesperson responsible for most of the revenue or an IT manager who knows all the system passwords.
In larger, established companies, identifying these key players might be more complex. They could be middle managers or specialists who have become central to the company's operations, even if their formal roles don't reflect it.
Understanding who these individuals are is crucial, especially during challenging times like mergers, downsizing, or when facing stiff competition for talent. One way to pinpoint these influencers is through employee surveys. For instance, Thomson Reuters conducted a survey asking employees to identify their most trusted and competent colleagues, revealing those with the most influence in their teams.
Mitigating Risks Associated with Key Personnel Relying too heavily on a few individuals can be risky. If a pivotal person leaves, especially during events like mergers, or faces health challenges, it can disrupt the business. To reduce this reliance:
Empower More Employees: Distribute responsibilities. While a founder might have invaluable knowledge, letting other qualified team members take the lead can spur growth and diversify risk.
Reward and Recognise: If a key player feels undervalued or overwhelmed, they might contemplate leaving. Address this by offering salary hikes, promotions, or additional support. Adjusting roles and titles to mirror their actual influence can also help.
Key Person Insurance: This provides assurance to stakeholders that the business can continue smoothly even if a vital team member is lost.
Whilst Key Person insurance offers a safety net, proactive measures to identify, support, and empower key talent are essential for a resilient and thriving business.