Staff Retention: How to Reduce Staff Turnover
The moment an employee hands in their notice, business costs begin to accumulate. Not only does it cost the company to recruit another employee to fill their role, it also takes time to train someone new and profits may be lost in the time it takes for the new employee to get up to speed. In fact, studies conducted by Oxford Economics estimate this cost at around £30,000 per employee once lost productivity is factored in on top of recruitment costs. And lest we forget there is the negative impact staff turnover has on those who are left to pick up the additional workload.
So reducing staff turnover needs to be a business priority. With this in mind, let’s take a look at seven techniques businesses employ to retain a greater number of valuable team members.
1. Put Staff on a Path to Career Advancement
Every employee wants to progress and one thing you can do to reduce staff turnover is to guide them along the path to career advancement. It is no longer enough for an employee to simply believe that a promotion is possible at some point in the dim and distant future, so take the extra steps to show them exactly how they can move up the career ladder. Give them added responsibility in the workplace and show that you care about their progression in the company. Offering an employee a strong career vision will motivate them to progress and increase their sense of belonging in the workplace.
2. Revamp Your Employee Benefits Scheme
Nearly two-thirds (62%) of employees say they’re looking to their employer for more help in achieving financial security through employee benefits, compared to 49% in 2011.
So employees, particularly millennials, are looking to their employers for help when it comes to addressing financial matters and one of the reasons for an employee to jump ship to another company is due to a competitor offering a more attractive fringe benefits package.
Analyse your competitors and see how your benefits package stacks up against theirs. Making a few tweaks to your offering to enhance your overall compensation package could be the difference between employees staying loyal to your company or moving on.
3. Create an Inclusive Working Environment
Another way to retain employees is to create a positive working environment that provides all employees with the opportunities to achieve their goals as part of a team.
Ensuring that all employees have the chance to take part in decision making is one way to embrace diversity in the workplace and create an inclusive environment.
4. Conduct Exit Interviews
All feedback is valuable, even if it is negative, so be sure to conduct exit interviews. This way you can gain vital insight into the reason that employees choose to leave. Look out for trends and issues within particular departments and use this information to your advantage.
5. Think Outside of the Box
When thinking of ways to reduce staff turnover, many companies turn straight away to financial incentives. But if your company already offers competitive salaries (even if they’re not necessarily industry-leading) then greater gains vs spend can be found elsewhere. For example, studies show that recognition and praise are big motivators for employees, and implementing a formalised scheme to help create a culture of appreciation will only set the company back 1-2% of payroll. Cash is not the only motivator in this instance.
6. Create a Sense of Ownership
If an employee feels a sense of ownership over their projects and tasks, they are more likely to stay loyal. Giving your employees more responsibility and listening to their thoughts on tasks can ensure they feel as though their opinion matters. By giving individuals a voice and by clearly defining how their contribution aids the progression of the company towards business goals, will increase their sense of job satisfaction and reward you with a lower employee turnover rate in the process.
7. Improve Performance Reviews
Employee performance reviews are the perfect opportunity to make staff feel valued but if carried out inadequately, performance reviews could have a negative effect on employee turnover. If your employees aren’t finding performance reviews helpful, you may think about revamping the process to make them more beneficial. This may stem from the fact that they are often an annual affair filled with intimidating paperwork. By creating greater regularity of reviews and short-term goals greater buy-in of the process can be achieved.
A performance review is not only a great opportunity to praise employees but it is vital to gain feedback on how you could improve your employee turnover rate.
Whether you are merging, restructuring or simply reviewing your current processes, these tips could help you to retain those employees that are vital to the success of your business.