Are staff retention problems costing you? The Work Institute’s 2017 Retention Report found that it costs employers at least one-third of an outgoing employee’s annual 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 retention strategies fail. Instead, they should look at how these 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.
Set Your Employees Up for Success
Retention strategies that focus solely on benefits and compensation are probably missing the mark. According to the Work Institute report, just 9 percent of outgoing employees reported 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 as reasons for leaving. Compensation will always be an important retention 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, but this doesn’t have to be the case. Best-selling 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 don’t 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 U.S. workers aren’t sure what is 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 need 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 clearly define goals and expectations.
- Personalize expectations based on employee strengths, goals, and interests to encourage employee engagement.
Bring Managers into Employee Retention Strategies
At a time when employees are more likely to resign because of how they’re treated by a manager than because of how much they’re paid, effective managers must genuinely care about their employees on a personal level. This means not only that managers should be having regular conversations with employees, but also that managers should be equipped with the tools to handle these dialogues. It also means helping employees realize personal goals, achieve a positive work-life balance, and improving overall workplace conditions. With so many components necessary to ensure successful employee retention, are your managers up to the task?
Click here for a list of books that can help your managers with these conversations
Want to know how to retain employees? 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. In Hello Stay Interviews, Goodbye Talent Loss, Beverly Kaye and Sharon Jordan-Evans write 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 a priority. 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 on how to respond 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 is no way to know what an employee really wants without asking, so don’t wait until it’s too late.
Talking is great. Taking specific actions to improve the workplace is even 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 guidelines 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 Jordan-Evans explain that “love ’em leaders genuinely care about people.” These leaders \believe that being an effective manager involves appreciating, nurturing, growing, recognizing, challenging, and respecting employees. 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 and are a leading contributor to employee burnout, according to Emma Seppala of Stanford University 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. “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,” writes Lawler.
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 PWC 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, so if you don’t start off on the right foot, new hires will have one foot out the door. Managers play the most important role in effective onboarding, according to the Harvard Business Review. To get off on the right foot, a formal onboarding program should focus on defining roles and responsibilities, feature regular check-ins between managers and new hires, and new hires should receive help integrating into an organization’s social circles.
In a review of job transitions, economist Andrew Chamberlain and Glassdoor data scientist Morgan Smart found that 73 percent involved employees leaving their employer while only 27 percent were advancing within their current organization. This, paired with unemployment levels dropping below 5 percent, HR professionals have their work cut out for them.
But there’s good news: Chamberlain notes that even a 1 percent improvement in employee retention translates into hundreds of retained employees at companies with thousands of employees—and each of them has the potential to be a future leader.
