The Work Institute’s 2017 Retention Report found that it costs employers at least one third of an outgoing employee’s salary to recruit, hire, and train a replacement. But the actual costs could be much higher. Given that there’s a clear link between employee turnover and organizational effectiveness, it’s fair to ask: What’s the cost of not having the staff to reach your organizational goals?
HR directors shouldn’t blame themselves when staff retention strategies fail. Instead, they should look at how retention strategies align with the current job market and workforce to pinpoint gaps. If staff retention strategies are missing the mark, they’re probably aimed at the wrong target.
Setting your employees up for success
Retention strategies that focus solely on benefits and compensation are probably missing the mark. The aforementioned Work Institute report found that just 9 percent of outgoing employees cited compensation and benefits as reasons for departing. . Meanwhile, 22 percent cited career development opportunities, 12 percent cited work-life balance, and 11 percent cited managers’ behaviors. Compensation will always be an important motivator, but personal and professional growth have taken the lead.
Are your training and retention strategies based on personal connections or paperwork?
For some, professional development conjures images of cumbersome checklists, deadlines, and performance reviews. That doesn’t have to be the case. Bestselling authors and retention experts Beverly Kaye and Julie Winkle Giulioni write in Help Them Grow or Watch Them Go that personal connections should be the emphasis of training and employee retention strategies.
Whether in individual development planning (IDP), one-on-one meetings, or mentorship programs, focusing on personal connections rather than paperwork is a key to success. Also, Kaye and Giulioni emphasize that promotions and upward mobility do not have to be the ultimate goals of workforce training. Training and guidance can also help employees grow in their existing positions.
Are you sure your employees know what they’re supposed to be doing?
Astonishingly, a recent Gallup poll found that half of all employees in the United States aren’t sure what’s expected of them in their current positions. It’s hard to remain engaged in a task or project when you’re unsure of the ultimate goal, so managers have to do a better job of clearly defining roles and expectations. The study’s authors suggest these tips:
- Employees and managers should work together to define goals and expectations
- Personalize expectations based on employee strengths, goals, and interests to make employees more engaged
Bringing managers into employee retention strategies
As the 2017 Retention Report found, employees are more likely to resign because of how they’re treated by a manager than because of how much they’re paid. Simply put, effective managers have to genuinely care about their employees on a personal level. That means having regular conversations— and equipping your managers to handle those conversations through training and leadership development. It also means helping employees realize personal goals and achieve work-life balance, while also improving overall workplace conditions. All are key pieces of successful employee retention strategies. Are your managers up to the task?
Want to know how to retain employees? Have managers ask them.
Everyone is motivated by something different; there’s no way to know what employees want without asking. Unfortunately, most managers don’t ask until it’s time for an exit interview. Beverly Kaye and Sharon Jordan-Evans write in Hello Stay Conversations, Goodbye Talent Loss that those conversations should be had between managers and employees on a regular basis.
These “stay interviews,” as they’re called, serve dual purposes. First, they let employees know that they’re valued on a personal level and that their happiness and fulfillment are priorities. Second, these conversations help managers establish a clear plan on how to nurture employees’ short- and long-term goals. Kaye and Jordan-Evans offer these four tips when employees tell you what they want:
- Reiterate how much the employee is valued
- Be truthful about challenges and barriers to granting their requests
- Position yourself as their advocate
- Keep asking questions and keep the conversation going
There’s no way to know what an employee really wants without asking. Don’t wait until it’s too late.
Talking is great. Taking specific actions to improve the workplace is better.
In today’s workplace, we’re all asked to do more with less. Not surprisingly, job burnout has become so common that the Mayo Clinic has drafted guidance to help people diagnose themselves. And when an employee confides in a manager that they’re experiencing some of the symptoms—cynicism, impatience, lack of energy, procrastination, disillusionment—specific actions should be taken to improve working conditions. The Society for Human Resource Management suggests encouraging employees to take “mental health days,” letting employees work outside the office once or twice a week, balancing workloads, defining priorities, and encouraging employees to unplug when they leave the office.
When employees voice concerns to their managers, being heard and understood goes a long way. In Love ’Em Or Lose ’Em, Kaye and Sharon Jordan-Evans explain that “love ‘em leaders genuinely care about people.” They believe that appreciating, nurturing, growing, recognizing, challenging, and respecting employees are important aspects of being effective managers. Kaye and Jordan-Evans also add that managers have more power than anyone else to keep good employees: “Why? Because the factors that drive employee satisfaction, engagement, and commitment are largely within your control.”
Rethink talent management with people in mind.
Traditional authoritarian talent management paradigms are familiar—but they’re not effective.
Tough managers don’t motivate employees to perform better. Instead, they increase employee stress, a leading contributor to employee burnout according to Emma Seppala of Stanford University in a recent piece in the Harvard Business Review. Effective talent management requires an individualized approach to evaluating and rewarding performance, not a rigid one-size-fits-all paradigm.Edward E. Lawler III, distinguished professor and director of the Center for Effective Organizations in the Marshall School of Business at the University of Southern California, describes the changing talent management landscape in his book, Reinventing Talent Management. He writes, “Organizations need to have agile talent management practices that allow them to continuously and frequently change the skill sets of their workforces. Talent agility is a difficult competency or capability to develop in organizations, and it increasingly makes effective talent management difficult.”
That’s why organizations are increasingly turning to team-based talent management structures. Not only do networked teams give organizations more agility to address evolving challenges— teams also make employees more engaged. A PricewaterhouseCoopers study identified a few core tenets of team-based talent management: Make decisions based on evidence-based workforce analytics, value customers and team members at the same level, and change responsibilities of teams and team members on a regular basis.
Employee retention should start on day one.
Ninety percent of new hires decide whether they’ll stay with a company within their first six months on the job, research indicates. If you don’t start off on the right foot with new hires, they’ll have one foot out the door. Managers play the most important role in effective onboarding, the Harvard Business Review states. To get off on the right foot, a formal onboarding program should focus on defining roles and responsibilities, there should be regular check-ins between managers and new hires, and new hires should have help integrating into an organization’s social circles.
Employees leave their employers in about 73 percent of job transitions, economist Andrew Chamberlain writes in the Harvard Business Review. With just 27 percent of employees advancing within their current organization, and with unemployment levels dropping below 5 percent, HR professionals have their work cut out for them. But there’s good news. Chamberlain notes that just a 1 percent in improvement in employee retention translates into hundreds of retained employees at companies with thousands of employees. And each of them has potential to be future leaders. Organizations must rethink retention strategies in order to ensure continued success.