Retention in HR?
Retention is “the ability to keep or continue having something” and in a corporate context ‘retention’ is shorthand for ‘employee retention’ and refers to the employers ability to keep hold of their existing employees.
Why does employee retention matter?
Employee retention should be a top priority for all organisations. When an employee leaves, employers are left to absorb the costs involved – the cost of hiring, onboarding and training a new employee.
As well as the financial implications, high turnover creates a severe breakdown in team morale – internal business relationships are a fundamental aspect to job satisfaction.
Securing employee loyalty long-term means they become more valuable over time – they are an ‘appreciating asset’. Thus to say, the longer employees stay, the more advantageous they become to the company.
How to retain employees – the 5 key drivers of employee retention
1. Make growth and development a priority
Offering the opportunity for continuous learning, training and upskilling are fundamental to creating an engaged, productive and loyal workforce. When you invest in employee success, they will in turn invest in your business. 73% of employees would stay at their company longer if there were more opportunities to build their skill set.
Establish your employee goals, give them incentive to stick around by helping them reach them. Make sure their progress is an ongoing and central discussion in their annual reviews.
If an employee feels as though they have hit their limit and are no longer learning anything beneficial or advancing to themselves, future career or the organisation, they will look elsewhere for new opportunities that enable them to progress.
2. Reward and recognition
Rewards are a way of expressing your gratitude you’re your employees’ hard work. They can be tangible or intangible.
Tangible rewards include financial remuneration like gift cards or bonuses. These types of rewards are powerful short-term motivators. However, the trouble with tangible rewards is that they have limitations – people are loyal up to the point that they receive the reward.
It’s intangible rewards and recognition that will really set you apart and give you the impact you desire. These include things like managerial praise, words of affirmation, recognising employees’ accomplishments (especially publicly) and showing appreciation.
Intangible rewards and recognition are things that are unique to each company. Being an appreciated member of a team and having a positive relationship with your manager, is something you can’t attach monetary value to, or easily replace.
Longer-term rewards and recognising employees by giving promotions, pay raises and internal hiring sends the message that you’re paying attention to what your people are achieving, how much you value it and that you are invested in helping them make their long-term goals a reality.
3. Support employee wellbeing
Employee wellbeing is determined by many factors, but it comes down to employees feeling supported, accommodated and empathised with.
The importance of empathy in the workplace can’t be overstated. Not only are 90% of employees more likely to stay with their employer if they are empathetic to their needs, but they are willing to work longer hours. (60% would even take slightly less pay if it meant their employer was empathetic!)
Put yourself in their shoes, when communicating or decision-making, take a moment to reflect. If you were in their situation, what treatment would you like and respond best to?
Emphasize employee wellbeing by writing it into your company policy; offer generous time for parental leave, annual leave, sick days and compassionate leave. To employees, these are things that are the fundamental importance of work. Show your employees that they’re important to you too to boost morale and loyalty.
Make sure your people are maintaining a healthy work-life balance. If you see employees online beyond working hours – tell them to sign off. Since the start of the COVID-19 pandemic, 37% of people report working longer hours, and 40% report burnout. Overworked employees burnout, which leads to decreased work quality and output.
Some people also work better in different environments, and at different times. Does their role require them to be in the office (or available online) from strictly 9am-5pm? Be flexible on working arrangements and hours. Companies that are highly rated for the flexible working arrangements have a higher retention rate by 137%.
4. Give employees a stake in the company
Is the company experiencing success? Let employees enjoy it too; they are the driving force behind it. By offering stock options you are giving employees the opportunity to capitalize on a percentage of the wealth the company generates.
This also makes employees feel accountable for your company’s future growth. It gives them a greater sense of ownership, allowing them to feel more connected to the business. Because their stake is greater, their investment in your success increases.
It also provides a long-term incentive to stay on board – the more they contribute to your success over time, the greater their stock value.
5. Empower them with a voice
Empower your employees with a voice. When people feel heard, they are 4.6 times more likely to perform at their very best. This is because they feel like they are a respected part of an ongoing dialogue between employer and employee.
Regularly check in on employee sentiment by sending out short surveys, frequently. This is key. You must ensure you turn feedback into action quickly. Think about conducting stay interviews? It’s the opposite of an ‘exit interview’. Exit interviews have proved very useful- employees tend to speak more freely, speak their mind when there’s nothing to lose, so their feedback is more likely to be honest and unfiltered. Use this method in a proactive way. Conduct stay interviews and give your employees the opportunity to pinpoint what motivates them to stay, as well as diagnose issues early on. Ask them things like; Why have they remained at the company? What do they want from you to supercharge their performance? What is the preferred way to be recognised?
Stay interviews improve employers’ self-awareness. When you understand how you are perceived, you’re in a stronger position to act to sway the pendulum in your favour. You learn what individuals value as your unique selling point, and get a better hold on their expectations from you going forward. This is essential information for optimising an employee retention strategy. The secret to mastering employee retention is making yourself indispensable as an employer. So strive to be the most attractive option to employees and potential employees by investing in growth and development, wellbeing, feedback, stock options and recognition. Employees will repay you with something invaluable – their loyalty.