Risk advisory firm Steve Vickers and Associates has warned of “significant staff defections” over the coming months, as end-of-year bonuses are handed out, families reconsider their options in light of Covid-19 restrictions, and the work-from-home environment makes it easier for people to switch to new firms.
“An exodus of staff to a rival firm is a nightmare for directors, and a test of management resolve. Defections can result in financial harm, loss of confidential information and key clients, and significant damage to reputation, morale and even the survival of an enterprise,” said Vickers in a note over the weekend.
Earlier this year, a study by Microsoft predicted as many as 40 percent of employees will resign from their jobs in 2022 – this has become known as “The Great Resignation.”
Vickers said the growth in number of companies offering remote working opportunities has only widened the scope for such defections.
“Staff may seek employment at firms newly within (digital) reach, even as greater movement in the labour market is encouraging competition among firms to secure access to talent.”
“Similarly, limitations on international travel are putting intense pressure on expatriate workers, in Hong Kong, Singapore and Mainland China who have hitherto operated on the assumption that travel to home states was a given. Now, staff may opt to return home, but ensure that they depart with key client lists, or legal precedents (in the case of law firms), so as to facilitate a “soft landing” at the other end.”
“A relocation of operations, as has become common in the context of growing regulatory challenges across Asia, could be another trigger for defections. One recent example concerned a technology start-up in Hong Kong that was in the late stages of a planned staff relocation, when a rival platform stepped in to recruit key software developers unwilling to move to a new city.”
Though Vickers noted that staff movement is normal, departures accompanied by unethical, or even illegal, activity can threaten a business.
The risk advisory firm suggests that company directors need to get ahead of this potential risk to their business, such as creating a crisis containment team, conducting staff interviews and intelligence gathering (identifying those “friendly” to the business, and those that are not), and gathering evidence of those looking to defect.
“Defections take time and resources to organise, and often leave traces of abuse on computer systems. Defectors may copy confidential information, or delete files. In particular, any unusual use of external storage devices, such as “thumb drives” always leaves a trace.”