Hiring an employee is only the first step.Retaining a positive, motivated staff and achieving overall high employee retention is vital for business success.
The costs associated with high employee turnover can include loss of customers and business as well as damaged workforce morale. In addition, there are costs incurred in advertisement, pre-screening, verifying credentials and references, interviewing, hiring, and employee training.
The direct and indirect costs associated with employee turnover can be as high as 200-250 per cent of salary. Not including the intangible cost associated with the replacement which include OJT, supervisor’s time, administrative, loss of team morale, quality, and customer’s dissatisfaction.
Implementing an effective employee retention< program is an effective way of making sure key workers remain employed while maintaining job performance and productivity.
Reasons why people leave
There are many reasons why people leave their job, some of the reasons for leaving a job are:
- Dissatisfaction with management
- Not getting along with colleagues
- Poor salary and benefits
- Lack of work-life balance
- Limited training and development opportunities
- No clear career advancement roadmap
By all means, these are not the only reasons but these include a few of the most common ones.
Implementing an effective employee retention strategy
The primary employee retention strategy has to do with creating and maintaining a workplace that attracts, nurtures, and retains good people.
The strategy covers a lot of issues, ranging from developing an organization mission, culture and value system to support a safe and conducive working environment which create clear, logical and consistent operating policies and procedures.
- Conducive and positive working environment – The goal of this strategy is to make your company a place where people want to come to work.
The organization must have cleared directions and policies to clarify its organization’s mission and vision, create a working company values system, establish unique company culture, structure a sustainable people management system and not least create conducive physical environment in which people work.
- Effective performance management policy – An organization with an effective and fair performance management system will retain the best performers, but also disqualify the least performing employees.
In such cases, the company resources would channel rightfully and effectively to the employees who bring in most values to the organization.
- Adequate training and development opportunity – Deal with personal and professional growth. Good employees want to develop new knowledge and skills in order to improve their value in the marketplace and enhance their own self-esteem.
Create training and development opportunity to match your employees’ different needs. Helping your people with personal growth that not only makes a difference in their lives, but bond them more closely to the organisation.
- Systematic career advancement roadmap – Every employee likes to advance in their career, especially the high performers and the high potential few. What can be more encouraging to these employees thana clear path of how their career can develop in the organization with continuous best performance?
- Maintaining work-life balance – Family and personal life is incredibly important to everyone. When work begins to put a significant strain on personal life, no amount of money will keep an employee.
Stress the importance of balancing work and one’s personal life. Company values and policies play an important role in building a family focus in organization culture. The right culture will likely be repaid with loyalty and extended employment from the employees.
- Competitive compensation and benefit package – Money alone will not retain most employees;however, having competitive employee compensation strategies will certainly help. In the old days, companies essentially paid people for their time.
Today, more and more companies pay for performance – in every position. To retain employees, your compensation plan needs to incorporate this trend.
More often, employees want a working culture of openness and shared information.
They want to know where the company is moving forward and what its future will be like. How is the company doing financially? Where does it stand in the marketplace?
More importantly, employees wanted to know how their specific jobs fit into the overall objective of company goals, and how can they help get to where the organisation wants to go.Building awareness of the importance of employee retention is essential.
Effective employee retention strategies strengthen the ability of businesses to attract and retain their workforce. These practices help create an inclusive and diverse workforce where barriers are reduced and individuals can participate in the workplace efficiently.