Employee Retention Strategies: The Antidote to Turnover
In today’s economy, empirical data reminds us and confirms that good people are hard to find. So as leaders of the hiring practices in our organizations, we create a strong talent acquisition process. As long as you work hard to hire suitable candidates, keeping them is easy, right? Wrong. On the contrary, a tightening labor market can actually yield significant challenges for organizations of all sizes. As leading national economist and weekly Philadelphia Inquirer columnist Joel Naroff points out, “we are in a situation of emerging labor shortages across the board.” With supply and demand of jobs in overwhelming favor of skilled employees, companies are not only tasked with finding talent, but also preserving it.
Here at MEA, our members frequently turn to us for guidance on this issue, asking, “How do we retain our employees once we’ve hired them?” To echo Naroff’s directive in response, “Get your retention plans in place.” Because employee retention is the crux of company success during this time of economic paradigm shift, I’ve outlined a series of practical steps to help your organization develop a sound retention strategy designed to combat turnover.
1) Measure Turnover.
Many companies make the grave mistake of accepting turnover as a workplace norm. They simply acquiesce instead of aiming to proactively respond to and control turnover. Tracking, measuring, and analyzing turnover is a critical component of devising a retention strategy. Despite the positive economic outlook, the average annual turnover rate for all industries nationwide is measured at 11%, as reported by Compensation Force. A recent survey of current MEA members presents an even more palpable examination of turnover on a local scale, with 25% of respondents experiencing turnover at a rate of roughly 20%. Regardless of the frequency with which a company measures turnover or the diagnostics used, it is imperative that companies carefully assess turnover to identify root causes and begin to develop relevant initiatives to minimize it.
2) Engage Your Employees.
A common misconception among company leaders is that pay is the most significant factor impacting turnover. However, by reviewing data captured by Deloitte’s Global Human Capital Trends 2016 , a comprehensive survey garnering over 7,000 participants from companies worldwide, it becomes evident that Engagement plays a critical role in employee retention. Simply defined as “how people feel about the way things work around here,” engagement is something that must be continually understood, measured, and improved. To underscore its importance, it’s worth noting that 85% of respondents in Deloitte’s survey, designed to measure workplace management and trends in organization design, cited Engagement as the top priority.
This top-line finding begs the question, “How do I engage my employees?” Several key initiatives can be instituted to foster and improve engagement among your employees. For example, implementing regular “Employee Listening” sessions to solicit input is an effective way to identify and resolve workplace issues faced by employees, as opposed to the standard annual review which can often seem more perfunctory than developmental.
If employees express discomfort about making candid disclosures, alternative methods including anonymous social tools can be used. Another practice that can bolster engagement is to conduct regular check-in meetings with employees, which afford the opportunity to provide critical performance feedback and simultaneously address concerns. The key to fostering engagement is commitment to its lifecycle. In other words, it’s not enough to simply engage in dialog. Workforce leaders should adhere to a three-pronged approach of soliciting input, communicating results, and committing to addressing the issues raised.
3) Understand and Accommodate Today’s Workforce.
Identifying the values and priorities of your workforce is crucial to building an infrastructure conducive for retention. Millennials represent largest generations in U.S. workforce, but commonality exists among Boomers, Gen Xers, and Millenials in terms of workplace values. Their priorities in alignment are expressed as follows:
- Fair Treatment – Yes, “fair” is a nebulous term, but in terms of workplace priorities, it is governed by two key components: Compensation and Management. Simply stated, compensation must be attractive and competitive and cannot be below market. Communication with employees regarding salary structure should be transparent and direct. With regard to management, heavy emphasis should be placed on training and empowering your front line managers. Because of their influence and daily interface with employees, they are essential to fostering an inclusive, productive, and effective environment, which is conducive for employee retention.
- Opportunity to Grow – This is term is often misinterpreted to mean desire for promotion and speedy ascension of the ladder. However, today’s workforce does not necessarily define growth through power of title. Instead, they seek out companies who offer expansive and ongoing learning opportunities, and provide career mentorship and succession planning.
- Flexibility- Another misnomer, flexibility is NOT a euphemism for ‘working whenever I want.’ Flexibility is about allowing employees to produce results without having to adhere to traditional workplace constructs. You can provide flexibility through a host of different ways. If deemed feasible for your organization, alternative scheduling, earned time off, and/or a consistent rewards system are examples of practical options to create flexibility in the workplace without adversely impacting productivity.
- Measurable Impact of Work –Although it’s hard to implement a metric that speaks to individual contribution, employee connection to the organization must be understood, defined, recognized. Employees view their input on more holistic level. They want to be perceived as more than merely a cog in a much larger wheel. Transparency with respect to communicating high level information that impacts the entire company is paramount. Adopting a more agile culture in which leaders solicit thoughts and opinions of individual contributors at all levels can prove powerful in breeding loyalty and trust, both integral to retention. Encouraging employees at the department level to recognize colleagues who make significant strides to uphold their department’s respective mission and goals is also an effective way to communicate the value of each contributor in the workplace.
Please Share Your Retention Strategy Success Stories!
In addition to the three-pronged approach outlined above, we want to hear from you. As a staunch advocate of collaborative learning, MEA invites you to share with the member community your effective retention strategies. What methods and modalities have yielded positive outcomes for your organization? Through the sharing of best practices and exchange of ideas, we can offer a composite look at what companies in this region are doing to improve retention and minimize turnover. Once feedback is received, reviewed, and compiled, we will present the information in next month’s edition of Strategic HR with the goal of helping our diverse member population explore a broad spectrum of strategies and identify approaches best suited to your organization’s size and structure.
To share your retention strategy success stories, please email me at email@example.com.