Retention is quickly becoming a major concern for organizations of every size and in every industry. According to PayScale’s 2014 Compensation Best Practices Report, in 2009, only 28% of companies considered employee retention a main concern. Jump forward 5 years to 2014, and 57% of companies are now putting retention on that list of main concerns.
Here are some words of wisdom from experts in HR or leadership, on the pressing matter of increasing retention and fighting turnover.
“The work environment matters. We’ve done lots of research over the years on recognition, engagement, leadership, and management. It all shows clearly that people at work respond through Maslow’s Hierarchy of Needs. Once they are “safe” – ie. paid well, they look for more meaningful value at work. Is this work taking advantage of my skills? Do people appreciate me? Is the environment inclusive and diverse so that I feel that I fit? Does this company do work I feel proud of?”
Bersin brings up a great point here. Organizations have to be sure that fair and competitive compensation practices are in place first. Otherwise, engagement and employee retention initiatives could end up being a waste of resources when they fall flat.
“While exit interviews are relevant, a constant finger on the pulse of employee engagement and satisfaction is more effective. Exit interviews have proven to yield some great feedback, but we want the focus to switch from, ‘Why did you leave?’ to ‘What keeps you here?’ This happens when organizations start to focus on the stay.”
We liked this quote pulled from an article titled, “Focus on the Stay”. Creating a communication culture allows workers to bring their concerns or issues to light, before they consider leaving. Soliciting continuous feedback can be a strong combatant of turnover.
“Companies that don’t think about [employee retention], that basically rest on their laurels and think ‘the economy will take care of us, where are they going to go?’ Those are the companies that, as soon as the labor market picks back up, their turnover rates are going to go from 5 percent to 50 percent and it will happen overnight.”
We’re actually starting to see what Murphy forecasted happening in business right now. Employees who aren’t happy, now have options. The economy is getting stronger, and those employers who didn’t focus on employee satisfaction and employee retention, are getting hit hard now with costly, high turnover.
“If employees have more options and can easily move, they’ll do it. You’ll see it happening first with top performers … in this environment, companies will need to evaluate what causes employees to leave and improve these areas, such as pay, work environment [and] vacation policies.”
Organizations first have to find out what their employees need and want before they can offer it. When higher-ups take a stab in the dark at engagement with irrelevant benefits or perks, they are just wasting company resources. Leaders need to find out what makes their workforce tick on an individual level.
“Hire the right kind of employees who are both a skills and culture fit. A focus on both aspects is important to success. Sure, some people are ‘shooting stars’, and you’d be lucky to catch them, but if they’re not a fit for the culture of your organization then you’re not likely to see maximum performance or employee retention. By interviewing and choosing the right hires in the first place, you’re getting a leg up on setting up a relationship that can last.”
It is still debated whether or not retention is a solid metric in recruiting. While many retention factors are out of the hands of the hiring decision maker, cultural fit and skill requirements are two areas in which hiring can make a huge impact on employee retention.