Better to have loved than lost employees.

• Position: SAS Institute Inc. - Cover Story

Just how spoiled has SAS Institute Inc. become? Consider the response of David Russo, vice president of human resources, when told SAS was a finalist for BUSINESS NORTH CAROLINA'S list of the best Tar Heel companies to work for. "We better be No. 1, because if there's a certain company that has said they're better, they're lying to you."

It's easy to see how SAS has gotten so cocky. The Cary-based software maker was No. 3 on Fortune magazine's national list last year of the 100 best places to work, and each year since 1989 it has made Working Mother's family-oriented list.

The SAS driveway, just off Interstate 40 and marked by a couple of shrubs and a small sign, belies the headquarter's grandeur. Beyond sprawls a 200-acre campus, similar to a mid-size college. Sidewalks connect the 20 buildings, identified by letters of the alphabet, from A to T. Employees clad in bluejeans jam the walkways at lunchtime, strolling to the 35,000-square-foot recreation center - it features racquetball courts, a gym, an aerobics room, pool tables, Stairmasters, treadmills and weights - or to the child-care center to eat with their kids. It's like a little commune, with President Jim Goodnight, whose house sits in the woods behind, watching over the 2,700 who work there.

For the Cary employees and the other 2,800 scattered around the country, the SAS human-resource strategy works like a Roach Motel: Employees check in, but they don't check out. Turnover at the company is just 4%; the industry average is close to 17%. The reason: Employees find it tough to find better benefits elsewhere.

Hands down, Goodnight has given his employees the best retirement plan in the state. They pay nothing, while each year SAS contributes 15% of their salaries and bonuses. It also pays 100% of health premiums, including for vision, dental and hearing care.

Software companies have to offer big incentives, says Richard Blackburn, a Kenan-Flagler Business School professor and one of BNC's judges. "In that industry they're having a hard time hiring people." According to the Arlington, Va.-based Information Technology Association of America, 346,000 - about 10% - of U.S. information-technology and computer-programming jobs are vacant.

But Russo says SAS offered its stable of benefits long before the industry started scrambling for workers. The retirement plan, he notes, has been around since Goodnight started the company in 1976, and the child-care center went up in 1981. "Barbara...