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5 Best Employee Retention Strategies for Your Organization

According to a research by Gallup, 60% of millennial are open to a job opportunity at any given point in time. Millennial are notorious for being job hoppers but one cannot blame them as they are always being lured by companies with better salaries, perks, benefits, promises of a better work life balance and what not? This is an age of cut throat competition and organizations want the best talent to work for them. This alone is a reason important enough to have a solid employee retention strategy in place and that’s what we are going to talk about in this post.

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What is Employee Retention and why it is important?

What is Employee Retention and Why is it important?

Recruiting teams work hard to get the right talent onboard. Recruitment process by its inherent nature is time-consuming and expensive. It takes a considerable time to create job descriptions, go through interviews, assessments, background verifications etc and efforts from multiple stakeholders. Then finally the candidate is hired and further time and efforts are spent to onboard the candidate. But at the end, if the employees don’t stick at the company and moves out at the first opportunity than that is certainly a problem. Know what is employee retention and why it is important for organizations.

  1. What is Employee Retention?
  2. Why is Employee Retention Crucial for an Organization?

What is Employee Retention?

Employee retention is a collective term for policies and strategies to ensure employees do not leave the organization within a short period of joining. In simple words, it’s an organization’s ability to make employees stick around for a longer period of time. The retention rate is represented in the form of %. A higher retention rate is generally favorable as more employees leaving the organization lead to higher hiring costs and loss of productivity.

Why is Employee Retention Crucial for an Organization?

Successful businesses with proud history will often tell you one same thing: their employees are their biggest assets. Companies that take their employees for granted thinking that even the best workers can be replaced often settle for mediocrity. Great businesses understand the importance of holding on to their loyal, high performing employees.They always keep their employees first, listen to and fulfill their needs in order to make them feel valued and motivated. They implement various employee retention strategies to reduce employee turnover because they believe in their people and consider them as the greatest asset. In doing so, they are avoiding many other complications such as:

Low Turnover Cost Is One of the Benefits of Retaining Employees

Hiring is no easy task, and definitely not cheap. It takes days, sometimes weeks of a recruiter’s productive hours to hire a candidate. There is a cost to advertising the job on different platforms. It involves the valuable time of many stakeholders such as the hiring manager, interviewers, and team leaders. As per Wall Street Journal, it can cost twice the employee’s salary to find and train a replacement. This doesn’t even factor the loss of revenue in terms of productivity loss as the position you need to fill is now empty without anyone dedicatedly doing that work. If employee retention is a serious problem, this loss will have a compounding effect on the business bottomline.

(Also Read: Why Employee Engagement is Important?)

Knowledge Loss is Why Employee Retention Matters

You hired a top talent, trained them and now instead of working to your benefit, they are working for your competitor. How bad that loss is? Not only did you wasted money and time in hiring that candidate but you also lost a lot in terms of the value and knowledge that they could have brought to the table. If your best employees start leaving you to work for competitors, it would soon result in a pitiable condition for the business.

Better Teamwork is One of the Advantages of Retaining Employees

Even if the business gets lucky second time and hires a better replacement, it will be anything between one to three months before that new hire is able to settle in the company. There is still no guarantee that the replacement will be able to build the same camaraderie as the previous employee had with other team members which again, could be an issue considering how important team work is for completing deadlines and achieving objectives. Companies that have better work relationships within their employees often do well as the team members will be quicker to help each other and support in times of need.

(Also Read: How to Increase Employee Engagement- Five Important Tips)

Outgoing Employees Poaching Customers is why employee retention is important

Sales professionals often have deep, loyal relationships with customers. In fact, in many organizations the sales guy is the only person a customer will trust. Also, every salesperson has his list of “pet clients”, i.e customers who will renew their subscription just by taking their word for it. Other than sales people also, if a customer regularly deals with an employee and suddenly that person is gone, it may put that customer’s loyalty at risk. While there are many cases of ex-employees poaching clients for their new employer, which is ethically wrong, even a customer will not be comfortable dealing with new representatives every now and then. Some do understand that employees move from company to company for career growth, but if such behavior becomes an everyday occurrence it will raise question over company’s policies.

There are other reasons also why your company should pay attention to employee retention such as wastage of resources in training replacements, and loss of employer branding. Therefore, recruiters must work on developing employee retention strategies right from the very beginning of their recruitment strategy instead of waiting for a contingency.

How to increase Employee engagement

How to Increase Employee Engagement – Five Important Tips

We know how everyone says that a company’s workforce is its biggest asset. However, to see this idea from the prism of performance, it will reveal that not every employee is an asset. Employees that perform well are assets; those who don’t are more of a liability. Is there an easy way of transforming your liabilities into assets? Maybe not. But if you start any such exercise, engagement will be the first and an indispensable part of this process.

Employee engagement is essential to a company’s success as disengaged employees mostly show negative performance metrics. If employees feel disconnected and unenthusiastic about their work, they would surely not be putting their maximum efforts which would reflect in their performance and at the end, would prove detrimental to a company’s bottom line. An HR’s role is not only to formulate and enforce company policies or recruit new candidates but also to make sure that the existing employees feel good about the work they are doing and the space they are in. So now the question comes, how to improve employee engagement in an organisation?

Make each employee feel valued and engaged to improve employee engagement

An organization that supports multicultural workforce, where employees are from all walks of life, it is difficult to create a one-fit-applies-to-all employee engagement strategy. Treat each employee as an individual and tailor fit your approach by identifying behavioral traits and individual aspirations. For multinational companies where there are thousands of employees working out of different locations, this exercise may be a bit difficult but not impossible.
Conducting employee surveys is one way of assessing their individual tendencies. Depending on the end goals, the data collected from the surveys can be analyzed to identify the red flags, the roadblocks, the career interests, personal likes & dislikes, career aspirations of the individual employees. This data than can be shared with the respective managers to match the work of each employee with their skills, interest and comfort. Individual personality assessments are an easy way of making each employee feel valued and aligning their goals with the company’s goals.

(Also Read: Human Resources Trends for 2018)

Use of technology is one of the ways of increasing employee engagement

The right technology can be one of the most important drivers of employee engagement. Whether it is the career site which shows genuine stories of employees thriving in the workplace, or an HRMS that also allows employees to have a direct conversation with the concerned HR, the role of technology in increasing employee engagement is paramount. Chatbot is another innovation that can actually disrupt the entire employee-HR communication channel.

Equipped with natural language processing and machine learning, these chatbots will answer all employee queries, will grow intelligent in their responses with time through AI and most importantly communicate with them in real time, as and when required. There will always be some employees that will be more comfortable with a chatbot communication rather than a face to face interaction. Modern technology promises to cover all bases. Using gamification is another method of employee engagement that makes tasks appear more exciting and fun.

(Also Read: What is the Impact of Technology on Recruitment?)

Providing learning opportunities to employees is a powerful employee engagement initiative

Promoting a culture where employees are motivated to learn new skills and continuously work towards their professional development is great not only for increasing their productivity but also for fostering a collaborative culture. Where there is collaboration, engagement follows automatically. The more the employees are confident that their employer is interested in building their capabilities, the higher will be their trust and engagement. However, most employers consider budget a constraint in implementing such large scale training programs. Cross training is a simple exercise where employees teach other some aspects of their job. Workers learn to perform other people’s responsibilities in addition to their own. Investing in such activities increases camaraderie amongst employees, build loyalty and promotes engagement.

Listening to employee feedback is a good exercise to improve employee engagement

As per the Aon Global Employee Engagement report, effective leaders listen to the feedback of their employees and then act on it. This is why most organizations are now doing away from the once-in-a-year performance review and replacing it with a quarterly or a six monthly review of performance and feedback session. This helps in addressing problems quickly and also provides a boost to employee confidence.
Wherever there is a gap between expectations and performance, an HR needs to have an open and transparent communication with the employee to understand the hurdles and roadblocks they are facing. They need to bridge the communication gap between the manager and the employee without taking sides. The last bit is important as employee may suffer from a preconceived notion that HR will give more attention to the manager’s view than his own. It is the responsibility of the HR to dispel any such fear from the mind of the employee and give him an equal opportunity platform to voice his concerns, challenges and areas of development. This is what true engagement is all about.

(Also Read: Purpose of Having a Dedicated Employee Referral Program)

Employee recognition is a meaningful HR activity to improve employee engagement

Lastly, the HR should run employee recognition and reward programs. High performing employees should be highlighted and rewarded with public recognition, not only to make them feel happy for their success but to set an example for other employees. The HR should define clear incentives and rewards for employees that consistently outperform and exceed expectations. These rewards may not be limited to monetary gains or a promotion.
Recognizing small achievements are equally important and in fact, more valuable when the goal is to get other employees motivated and engaged. Publicly calling out such achievers is the easiest and quite impactful way of making them feel special. Small gifts like gift certificates, souvenirs or movie tickets also help. Remember, the goal is to generate enough excitement amongst employees that they start engaging and working with greater zeal than before.

(Also Read: Disruptive HR Practices in 2018: What is changing for HR?)