Employees can quit for a lot of different reasons, but entrepreneurs are the ones that feel those losses more keenly than the larger entrenched businesses. For the most part, entrepreneurs employ far fewer employees, which means every employee carries more organizational knowledge. If an employee quits at a big box retail store, there are probably four other people with identical training. Employees in entrepreneurial ventures often perform two or three roles that no other employee can replace. Solving the challenge of low employee retention isn’t just a convenient tool for entrepreneurs to know, it’s imperative.
Money doesn’t solve all problems. It can solve the problem if a key employee is leaving strictly based on needing better pay. Every employee is different, so you can’t assume they’d volunteer the information that it’s about the money. Ask them directly if compensation is the problem. If it is, see if you can match the new offer or at least increase their pay enough to keep them on board. It’ll almost certainly be cheaper than replacing them.
Annual reviews might be convenient, but employees hate them for good reasons. Getting positive or critical feedback for things that happened six months ago is pointless. The details are long forgotten and the feedback lacks any meaningful resonance. Employees prefer to hear how they’re doing as they go. It lets them connect feedback to their performance and make course corrections. It also helps forge a closer link between employee and the business.
Entrepreneurs put high expectations on themselves and their employees. This might be necessary for success, but it can cause people to leave if it goes too far. Employees have responsibilities beyond the business and when they feel too overwhelmed, many will look for less demanding jobs. Fortunately, you can maintain your expectations and keep your employees if you adopt measures that allow employees to meet those obligations more easily. For example, you could allow telecommuting or flexible scheduling. As an added bonus, allowing employees to work from home can boost productivity while improving retention. If your assistant knows he can leave early for his kid’s dance recital on Friday, he’ll be happy to stay a little late to research commercial auto insurance for you today.
Have you ever tried to install something at home when you don’t have the right tools? It’s beyond frustrating, isn’t it? Now imagine that’s your work life every day. Asking employees to do work without the right tools is condemning them to constant frustration and poor productivity. That doesn’t mean you need state-of-the-art everything. It does mean you need to make practical investments. Tools should be specifically designed for the task, not be sort of a close fit. Consistently giving employees the right tools improves efficiency, but also signals you’re looking out for them. People want to work for businesses that support them and this is one way to do that.
No one wants to feel like they’re stuck in place. Offering employees options for professional development can go a long way toward making them want to stay. You don’t need to cover their MBAs, but you can pay for approved online courses or certifications. You can send them to seminars. Internally, you can offer to mentor employees or hire someone to come in and teach soft skills.
Improving employee retention is critical for entrepreneurs. Unlike large businesses, entrepreneurial ventures often struggle to replace the knowledge and skills that walk out the door when someone quits. You can take a number of steps that will help you keep those employees. You can offer pay increases to those who are leaving for financial reasons. Policies that support work-life balance will make just about everyone happy. Providing the right tools shows you support your employees. You can also provide avenues to professional development, which reinforces their bond with the business.