Playing for keeps – employee retention that doesn’t break the bank

It’s expensive to hire new staff and even more expensive to replace them.  It’s estimated that the cost of replacing a mid-level member of staff can range from 50 pc to 150 pc of their salary – when all costs — recruiting, interviewing, hiring, training and reduced productivity are considered.

Money talks but it isn’t always the deciding factor for people when deciding to stay or leave your employment.

Our own research, conducted earlier this year among a random sample of 3,000 individuals on our recruitment panel, reveals that employees are looking to long-term career development to secure their future, with career progression cited by 33 pc as marginally more important than salary or daily rate.

So you might be the underdog in terms of the salary you can offer a particular candidate to stay with you, but this doesn’t mean that you’re out of the game.  Candidates take a holistic view of the opportunity at hand, looking at the complete package of salary, benefits and career advancement opportunities that you can offer, before making their play.  In fact, our research revealed that one of the most frequent reasons cited by candidates for leaving was reaching a perceived glass ceiling.

It’s important to remember that the reason an individual decides to join your organisation doesn’t necessarily compel them to stay for ‘extra time’.  People’s career aspirations change – they develop and grow personally and professionally.  But if your organisation can communicate with them and keep pace with this change, you can mitigate for high staff turnover and prevent a scenario where you lose the employee and with them all the intelligence, knowledge and experience they have built up over time.

Given the high cost of staff replacement, doesn’t it make more sense to develop and implement a formal employee retention strategy?  Practical, effective employee retention strategies don’t have to break the bank.  All they require is a little thought and a lot of imagination.

Here are our top five tips for retaining your best staff.

  1. Craft a rounded package of benefits
    So there’s no getting away from it.  Salary or daily rate is important but it isn’t all important.  Try to craft a competitive package for employees with performance-related bonuses (even if they’re not employed in the front-line sales function) generous healthcare, holiday entitlements etc.  Consider offering flexible working hours, which don’t carry a price tag.  Flexihours and/or the ability to work from home (or elsewhere) are very attractive for those with young families or long daily commutes.  Life/work balance is still an important consideration for people when moving jobs.
  2. Carry out “stay” interviews
    Staff that have been with you for a while are very often a source of valuable, untapped information.  Stay interviews are designed to discover why they have decided to stay with your organisation. What motivates them to continue in their role?  What aspects of their job do they most enjoy? What aspects do they least enjoy?  Do they feel their contribution to the business makes a difference?  What aspect of their job or organisation would they like to see improved?Stay interviews can be done via anonymous surveys or questionnaires or can be conducted face-to-face at regular intervals by the HR department.  It’s surprising the information that can be garnered from an informal conversation over a cup of coffee and the process can also make employees feel that their view counts.  Stay interviews also help HR and senior managers to identify potential issues at an early stage and take immediate action to address them.  This ‘open door’ policy appeals to many employees and really makes them feel that they have an input into their own destiny.
  3. Initiate a mentoring programme
    This can be a very cost-effective method of helping employees to improve their skills, through a combination of training and mentoring from within.  Mentoring programmes typically involve a process of knowledge transfer, by pairing a senior member of staff with a less senior one, with a view to providing practical, on-the-job training to that staff member to develop their skills.A mentoring programme is typically accompanied by formal, classroom-type training but this doesn’t always have to be the case.  Mentoring really harnesses the experience of long term employees and ensures that this experience and know-how is not lost.  It’s also a low-cost model as training is provided from existing staff within the organisation and over the long term.
  4. Provide clear promotion pathways
    According to our research, career advancement is the single most important reason why people move jobs.  From the lowest level of the organisation right to the top, employees want to know that their employer can offer them advancement opportunities – a chance to grow and develop both personally and professionally and to move through the ranks of the organisation as they wish.In joining your organisation, employees want to be confident that they’re not going to be pigeon-holed into a certain job or function and be forgotten about.  For employers, it’s important to offer staff concrete advancement opportunities.  Show them it’s not just empty rhetoric by promoting from within, where possible.  This demonstrates to staff that promotion is possible with the right attitude and professional performance.  The importance of clear succession planning cannot be over emphasised and is one of the principal questions candidates ask when they approach Clarion Resourcing.
  5. Communicate
    Don’t underestimate the importance of communication, at every level through the business.  People like to work for successful organisations.  They like to know that at the end of each day they have contributed in some small way to improving customer satisfaction and potentially bottom line.  Communicate important business milestones, contract wins and ensure that all staff are aware that they have had a role to play in the organisation’s success. Similarly, if trading conditions are difficult, don’t keep your employees in the dark.

Finally, sometimes the smallest things have the greatest impact.  A client of ours, surprises its employees on the odd Friday afternoon with ice creams during the summer months.  Employees really value these small, inexpensive gestures and they undoubtedly help to foster a positive working environment amongst the team.

If you’d like to discuss any aspect of employee retention strategies, please let us know and one of the team will be in touch.

 

On May 9th, 2013, posted in: Blog by
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