No company's staff will ever remain entirely static and unchanging. Employees come and go over time, no matter the size, niche or success of a business. Managing that turnover of staff and achieving good employee retention can be a tricky balancing act.
The ideal situation is to have moderate staff turnover. New blood coming into the business will introduce fresh approaches and fresh ideas. That helps companies to retain a cutting-edge and to get a leg up on the competition. What no firm wants is to lose their high-performing staff. It can be especially damaging if you lose them to their rivals.
High staff turnover has other negative impacts. Hiring and training new staff to replace those lost is often an expensive and time consuming exercise. Seeing employees routinely leave will also have a detrimental effect on internal morale.
That’s not to mention the damage that high staff turnover can do to a firm’s external reputation. If people see that an organisation regularly loses its staff, they’re sure to jump to conclusions. Generally speaking they will feel that the firm doesn’t treat employees well enough.
That makes employee retention a key issue for businesses of all shapes and sizes. If you feel you may need a little help in that regard, you’ll find seven handy tips below. Before we get to those, however, it makes sense to first explain just what we mean by employee retention.
What is Employee Retention?
At the simplest possible level, employee retention refers to the ability of a company or organisation to keep its employees. Employee retention can be expressed as a percentage relating to the proportion of a workforce which stays with a firm over a period of time.
For instance, a company might have ten employees on January 1st. If eight of those employees remain the next January, their rate of employee retention for the year is 80%. When most people use the term employee retention, they’re not actually referring to that simple statistical measure. What they’re referring to is the effort made by a company to encourage their staff to remain with them.
Employee retention usually relates to what firms do to make leaving less appealing to their workforce. The process usually includes many steps like creating a good work environment and offering perks or rewards which enhance job satisfaction. To help ensure that your employee retention is up to scratch, we’ve put together our seven top tips.
1. Make Sure You Hire Well
Employee retention is generally about keeping staff within your company. It’s not about hiring new ones. If you don’t hire the right people in the first place, however, you’re always going to have high staff turnover. Good employee retention begins with a well-rounded, efficient hiring process.
That doesn’t only mean hiring the most highly skilled or qualified candidates. It also means choosing people who will fit well with your existing workforce. If you take on an individual who struggles to make friends in the office, they’re unlikely to stick around.
You should also consider your company culture and ethos when hiring. New staff need to fit with that culture. If they don’t, they’ll feel uncomfortable and might also have a negative impact on other employees.
Interviewing for any position needs to involve the two-way exchange of information. You need to find out as much as you can about a possible new hire. Details such as how long they stayed with their former employers can help you judge if a candidate will stick with your firm.
You should also provide the candidate with plenty of information about their new role. Dealing with that at the outset will mean they won’t have false expectations of their new job. That’s desirable as the dashing of those expectations might lead them to quit.
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2. Orientation, Training & Opportunities for Growth
You want to set your staff up for success from day one. That means making their earliest experiences in their new job as pleasant as possible. A well-defined orientation process is key to achieving this. It’s best for a new hire to be welcomed at the door on their first day. You’ll also want to make sure that your other staff know there’s going to be a new starter.
Proper on the job training is crucial for helping a new hire settle in. Someone who understands the role your new employee is starting in should be available to help them get started. If you feel it would be appropriate, you may even want to consider instituting a mentorship system. However you do it, you need to make sure that a new hire is made to feel comfortable and at home.
It's only if they do quickly achieve that level of comfort that they’ll perform to their best. What’s more, they’ll more quickly start to identify as a valued member of your staff. Feeling like that will make them less likely to start casting glances toward possible positions with other firms.
Training shouldn’t just be something for new hires, either. Offering training opportunities to all your staff is a good way to help them feel like they’re growing in their jobs. That’s a recipe for high job satisfaction and good employee retention. You don’t have to go as far as arranging courses or outside seminars. Even educational DVDs or inexpensive training software can work really well.
3. Create a Safe & Comfortable Work Environment
All employees should feel safe and comfortable at work. It’s a fundamental responsibility for employers. It is also true that creating a secure and comfortable work environment will help with staff turnover and employee retention.
A workplace should maintain high safety standards. Employees shouldn’t be in any danger of injury or illness. You need to ensure good maintenance, good ventilation and other fundamentals of the workplace. Working in a comfortable office can also have a profound positive effect on employee retention.
Emotional and psychological comfort is just as important as physical comfort. You should do everything you can to foster a welcoming and inclusive culture at work. That’s the best way to get the most out of staff and to ensure that employees are happy in their jobs.
Maintaining a level of trust between staff and management is also critical. Staff will feel more comfortable if they know management are on their side. That leads to a feeling of shared purpose and makes employees less likely to want to leave. It will also make them more comfortable sharing ideas and looking to help the business develop.
4. Purpose, Recognition & Rewards
Providing purpose works as a great form of motivation. Employees are more fulfilled and happier if they feel their work is for something. Boredom and lack of contentment come from the feeling that work is a day-to-day drudge. Job satisfaction comes from understanding what their tasks are achieving.
If you want to engender a greater feeling of purpose amongst your staff, you have a couple of options. It’s a good idea to explain the direction of the firm and goals to your employees. That way they can see how their work is contributing to those goals. You will also want to set your employees clear KPIs to work towards. That will help with their focus and give them a greater sense of achievement.
Everyone wants to feel appreciated when they do achieve something. That’s why it’s important to always recognise your staff successes. You may be surprised at the impact a simple ‘thank you’ or ‘well done’ can have.
If you want to take things further, you could introduce a rewards system in the office. Top performance might be recognised with a prize or even an extra day off. Just make sure that any system fits with your workplace culture. An overly competitive or intense rewards scheme might cause resentment or discomfort.
5. Paths to Advancement
There are few things worse for a worker than the feeling that they’re stuck in a rut. This can send many employees straight toward a jobsite. A good way to improve your employee retention is by ensuring your staff don’t feel that way. That means making sure they understand that they can advance within your company.
Promoting from within is always a good way to show staff that your firm does allow for advancement. It will make the promoted individual happy and also shows other staff what may be in their future. The same goes for offering supervisor roles or increased responsibility to highly regarded members of staff. Such things make employees feel valued and that they’re contributing to the firm’s success.
Some firms don’t have the capacity to offer promotions or supervisory roles. That doesn’t mean they can’t provide job advancement to their staff. Constant feedback and clear communication will help management and staff work together to develop every role within the firm. Listening to a staff member’s ideas about opportunities for advancement is good for everyone.
6. Teamwork & Togetherness
A workforce that operates like a well-oiled machine is what all firms dream of. You want your staff to all pull in the same direction. More than that, you want them to work together in a way that gets the most out of every individual. Good teamwork can help people’s strengths and allow them to work on and improve their weaknesses.
If workers feel that they are part of a team, they’re less likely to want to leave. The camaraderie and connection they feel to their colleagues won’t be something they want to leave behind. It will also be something that makes them feel happier in their work. Happy staff won’t take the decision to move on lightly.
Fostering good teamwork and togetherness is a key part of good management. You need to encourage everyone to muck in and make sure they know that all ideas are welcome. You might also look to introduce some extracurricular activities to further boost team morale. That might mean a team building exercise or weekend. Equally, it could be something much simpler. Team drinks to celebrate work landmarks or staff birthdays often work just as well.
7. Wages, Salaries & Benefits
You might have noticed that we haven’t talked much about money so far. That’s not by accident. We’ve emphasised the importance of other elements of employee retention for a very specific reason. That is because those are things that many firms ignore. Too often, businesses think that competitive pay is all they need to keep their staff happy.
Hopefully we’ve already shown you this is not the case. Good pay and other benefits are, however, still an important part of employee retention. If you want motivated, highly skilled staff you have to be prepared to pay the going rate or better. If you aren’t, those staff will seek out other firms who are.
It’s not always about the size of salary or level of wages you offer though. Other benefits and concessions are just as important to your staff. Those include things like the amount of paid holiday or the kind of pension plans you offer. It can also encompass things that have very little to do with money at all.
Allowing employees to work from home or to work to flexible hours is often a great way to keep them happy. It shows them that you view them as an individual and not just a drone or part of the working machine. It can also help them to better manage family needs and other commitments.