Many companies are now beginning to view employee retention as a critical issue. High Employee turnover increases expenses and can also have negative effects on company morale.
Implementing strategies devised to retain good workers can help counterbalance replacement costs and reduce the indirect costs associated with high staff turnover such as lost clients and loss of morale.
Employee retention has become an important topic for many reasons.
These include:
- Social media networking tools such as LinkedIn make it easy to observe new job opportunities or get poached by another company
- Costs associated with hiring new staff, advertising, interviewing and hiring etc.
- Training new staff
- Loss of productivity. It can take up to 2 years for a new staff member to reach the same productivity levels as existing staff members
- Loss of engagement. Retained employees who see a high turnover often get disheartened and lose engagement
The longer staff stay with an organisation, the more productive they get .They get to know the systems, products and learn how to work together as a team.
Many high performing companies have loyal employees and each company has its own strategies for retaining their employees.
Some of the interesting things to consider:
- Compensation is a factor but does not play as big a role as you would think. Over-compensation will not offset a poor work environment
- Job fit is significantly important. Hiring the right people for the right positions by realistically advertising job positions will save you a lot of trouble in the long run. If you oversell a job you can suffer from high staff turnover. Effective retention strategies often begin during the employee recruitment process. Employees are more inclined to remain with a company that fulfils the promises made when their employment offer was extended. Companies that provide a realistic view of their corporate environment, advancement opportunities and job expectations to new hires can positively influence employee retention
- The work environment and culture matter. Staff want to feel appreciated, comfortable and included in their place of work. Employees that enjoy what they do and the atmosphere in which they work are more likely to remain employed with their company
Implementing an employee retention program is an effective way of making sure key workers remain employed while maintaining job performance and productivity.
In the end the most prosperous organisations are those that respect their employees and invest in building an engaged work place environment.