For many companies, the biggest workforce management challenge is employee retention. But convincing employees to stick it out with the company pays off. It can cost as much as 30 to 50 percent of an entry-level employee’s salary to find and train his or her replacement, and those costs skyrocket when it comes to senior staffs. Replacing a mid-level employee can cost your company 150 percent of his or her salary, and replacing a very specialized or high-level employee can set you back as much as 400 percent of his or her yearly salary.
So, what’s to be done? The best way to boost retention is through a multi-pronged approach that leaves employees feeling valued and appreciated. A yearly awards ceremony should be part of your plan, but it isn’t enough. Employees need regular feedback to feel appreciated, but they also need competitive pay and benefits, opportunities for professional development, chances to give feedback about the experience they’re having with the company, and clearly defined roles.
Give Regular Recognition
A simple “Thanks for staying late last night to help us wrap up that big project” can go a long way towards making employees feel like valued and appreciated members of the team. Don’t assume that annual bonuses and rewards ceremonies are sufficient as appreciation for all your employees’ hard work. So on top of an annual ceremony and even custom awards for top performers, you should complement these annual recognition events with more frequent and quotidian methods of recognition.
As a manager, you might be inclined to devote most of your energy to help employees who are struggling, and that’s fine, but don’t leave the better performers feeling overlooked. Take the time to say thanks, and offer praise that lets employees know you notice what they’re doing. You can reward employees for good performance on specific tasks in a number of ways – verbal or written praise, small bonuses, token gifts, and an extra day off – but make sure employees are recognized for their contributions in real time as well as on a regular basis.
Offer Good Pay and Benefits
As much as you might talk a good game about company culture and your organizational mission, it’s only natural that employees will jump ship if they get a better offer elsewhere. Unlike the conventional wisdom, job hopping is acceptable as a way to maximize earning potential; moving to a new organization can net an employee 10 to 20 percent more money, in most cases.
So, to keep employees from being tempted by monetary rewards from different organisations, offer them a competitive salary and benefits like health care, PTO, and retirement savings plans. On top of that, include other perks into your company culture, for example, flexible working schedules, telecommuting options, gym memberships, nap pods, stock options, or profit sharing.
Invest in Professional Development
It’s one thing to expect new hires to be well-trained and qualified, but it’s even more important to provide your current staffs with a chance to develop new skills. Today’s employees are more eager to learn and keep building new skills, and that’s why offering your employees chances for professional development can improve employee engagement and loyalty. Whether it’s in-person seminars or online learning, creating a positive learning environment helps everyone to grow together as a team and in turn, deliver better results.
Define Employee Roles
Employee roles can easily get muddled, especially in smaller companies. Morale can begin to suffer if employees aren’t sure of their responsibilities and KPIs. Employees can also get frustrated if they feel their roles aren’t giving them the chance to use their skills and develop new ones. Make sure roles are clearly defined but not restricted.
Be Open to Feedback
Exit interviews can be a valuable tool, but what can often be more valuable are stay interviews, which can tell you what employees like about the company, what are their concerns, and what circumstances potentially affect their performance. Additionally, give employees the chance to offer anonymous feedback to management. This way, the team is empowered to give suggestions they might not feel comfortable making in a face-to-face setting.
Your company can save a lot of money through a strategic retention plan, and to do that, you need to create an atmosphere in which employees feel appreciated. An employee who feels valued is one who will stay loyal and perform their best.
This article is contributed by Tiffany Rowe, writer of seekvisibility.com.