Inconsiderate of the situations with no control in the hands of the employer, in the end, it’s his money on stake if the employee turnover increases. Employee retention, on the other hand, aims to control all such situations. It reflects the firm’s ability to retain its employees and keep them longer. While employee retention is always represented in percentages, the higher it is for a firm, the better!
Though the primary aim is to convince an employee to stay, sometimes it’s natural and obvious for him to leave. It also depends on industry to industry, because some of them tend to have higher turnover rates than the other ones, and hence require a massive budget for the hiring process throughout the year. Reasons for higher turnover in these industries stand to be the obvious ones being job responsibilities, low wages, or fewer benefits offered at the job. Some examples for such industries might include- logistics, staffing, or call centers, probably because employees seek better opportunities all the time.
Why Employee Retention Matters?
With a clear explanation in mind for what employee retention is, the question in a light still stands to be- “Why is employee retention important”?
There’s not just a straightforward definition to understand the importance of employee retention, but quite a few reasons instead. For example, small business values their talented human resources, and can not afford to lose any of them. On the other hand, it’s also beneficial for the employees to stay together longer to maintain a productive and known work environment.
Highlighting the few main advantages of employee retention, here are the main points to be noted:
- Bad Hires Can Cost A Fortune!
The whole hiring process demands both money and effort. In fact, it requires a lot of them. An entire team will be focused on hiring the best candidate for the job while the other people will be focused on every possible promotion of job availability in the firm. Unless it’s a leading firm, ideal candidates need to be found!
All of this puts high stakes on the candidate selected after that, and having to fire him/her can cost a fortune of money and repeated efforts. Not only that, but the morale of existing employees and the organization gets affected by every single lousy hire.
- Veteran Employees Are Valuable.
The employees who have been there in the organization for a more extended period, or in simple language- the veteran employees of the organization understand the objectives and strategies to attain those objectives better.
As much as the veteran employees will be motivated themselves to work hard for their individual and organizational objectives, they motivate others too! New hires look up to such people and seek inspiration to work better in the long run for the organization.
- Employee Retention Makes Way For Success.
It’s an achievable world in the business industry out there, and it’s available for everyone increasing the competition at every job level. Every little detail of project matters, and hence every job in an organization matters in some or the other way too.
With that, an organization needs to have experienced and veteran employees at every level. This increases the productivity of the organization and delivers results sooner.
Actionable Strategies To Use
Some of the most valuable and effective employee retention strategies are:
- Offer Competitive Salary And Benefits:
Remember that the employee working day and night does it for his individual and organizational goals too. In return, salary might not be a sufficient factor, and he will need recognition and appreciation more than anything.
Check if the employees are appreciated enough for their efforts and role in the organization. Salary according to the industrial standards is essential too, and hence you might want to start working for that immediately.
- Encourage Employee Engagement
If an employee takes the initiative and puts forward an idea, he demands support and proper guidance to improve in the future. After all, personal growth matters for all of them.
Hence, whenever a new project strikes in, include the employees on every level to play a part for it. Especially if an employee wants to lead or handle a specific project, let them do it.
- Promote Growth Of The Employee
As soon as an employee joins an organization, he’ll seek challenges that will eventually question and develop his skill set. Hence, an organization needs to challenge its employees in a balanced way.
For example, competitive projects must be allocated to individuals by time to time to evaluate the capabilities and strengths of that person in the organization.
- Think About Well-being Of The Employee
A sense of trust and security is something that a potential employee will seek from an organization for as long as he delivers his best for their goals. Hence, it’s an organization’s job to earn the trust of their employees.
Offer long term benefits that ensure a long time of an individual in the organization, and tend to offer job security to them.
- Focus On Teamwork The Most
Teamwork is the most obvious, and yet a missing factor in an organization often! The more you connect with your team and keep them together, it tends to increase productivity and decrease employee turnover.
Evaluate the team or departmental productivity in your organization, and look for scope of improvement in any way. You can promote team activities or happy hours to encourage team development in the organization.
Nothing could be better than a real-life example to prove the above-stated theory. Clif bar who won the award for employee retention of 97% believes that the health of their employees matters the most, and hence they practice regular health programs to ensure the same. From building customized professional growth programs for the employees to their most successful employee stock option program, they do everything in their control to develop a sense of trust and belonging with their employees. Such programs and initiatives play a vital role in their high employee retention rate.
Hence, employee retention saves an organization a considerable amount of money and constant efforts for the hiring process.