Author: Mittal Nagda
You might have often come across managers saying, ‘My employees are jumping from this ship to that’ or ‘ This company is just a parking lot’ or ‘They never wanted to stay here and just like to jump ships’ or ‘It is so difficult to hook the employees on my board’. In simple language, every employer is facing the problem of how to retain its best employees. Since these employees are a source of competitive advantage, attracting and retaining an all-star talent pool is a hot topic now more than ever.
No matter what’s going on in the larger economy, companies are always at risk of losing their best employees to rivals. And when talented employees defect, their knowledge and expertise that are crucial to your company’s success go with them. And this is not enough; companies need to shell hefty sums to replace the departing employees and get new hires up to speed. Hence the best option for an organization is to identify best practices to retain these best employees.
What is Retention? Retention refers to a company’s ability to keep talented employees- people who will help their organization remain competitive in a world of rapid change. From an organization’s point of view, retention doesn’t mean trying to hang on to every employee forever. It means keeping good employees for the most appropriate period for their particular function or level. The several reasons why retaining good employees counts among the most essential ingredients for success in today’s business world are as follows:
- Companies depend on intellectual capital- it’s not machine or financial assets that companies depend on to survive and thrive, but people’s knowledge and skills.
- More people are leaving companies- the attrition rates are just shooting up high.
- Replacing employees is costly- replacing an employee is likely to cost atleast the departee’s annual salary.
- Employee defections erode customer satisfaction and thus profitability.
Having seen why is retention important, let’s see strategies that help in retaining employees.
§ Hiring Right: The hiring process provides a valuable opportunity for organization to lay the foundation for retaining valued workers. Chances of keeping a good employee can be boosted by
Ø Hiring for interests-While seeking to fill a vacant position, look for candidates who feel deeply and passionately interested in the kinds of activities that the required job will entail. Hiring primarily for interests is far more potent than hiring for skills, values or even attitude
Ø Hiring for Microculture- the key to hiring is to understand the existing microcultures and choose people who will fit into, enjoy and enrich them. A good Culture match can highly increase chances of retaining the hard-won new employee.
Ø Clarifying what you want-Many hiring decisions start off on the wrong foot because the company has not clarified what it wants from the new hire. This results into ambiguity and employees tends to defect because of frustration.
Ø Hire candidates that can be molded in your company’s culture and the ones that feel honored to be part your organization rather than the best, brightest or the over-confident ones. The former ones will make most loyal employees.
§ Being Employer of Choice: This can be done in numerous ways as follows-
Ø Designing right compensation policies
Ø Offering attractive benefits
Ø Helping employees balance their work and personal lives
Ø Fostering employees’ self knowledge
Ø Communicating job opportunities
Ø Developing employees’ talent
Ø Valuing diversity
Ø Nurturing multigenerational workforce and many more...
§ Cultivating the Right Culture: Many employees cite ‘culture’ as one of the most important reasons for staying with or leaving a company as it exerts an enormous impact on people. Companies can attract and retain valuable employees by being aware of their culture and taking steps to shape it. The process of shaping culture includes-
Ø Understanding challenges of cultural change
Ø Focusing on microcultures
Ø Surveying the current culture
Ø Defining the desired culture
Ø Making changes to close the gap between current and desired culture.
§ Helping Employees Avoid Burnout: Burnout can be defined as work exhaustion. In today’s business world, developments such as budget cuts, downsizing and rapid advances in technology often mean additional responsibilities and overload for employees. For most managers, overload carries with it a serious risk- burnout and possible defection of their best employees. Following are the measures companies can take to avoid burnout-
Ø Understanding the warning signs of burnout
Ø Know the root causes of burnout
Ø Practice creative staffing
Ø Minimize work exhaustion
Ø Re-recruit your top talent
In addition to these strategies, it is important that managers at all level support the strategies and involve themselves as a part of these strategies. Hence, it would be fruitful if retaining employees is made a part of their KRAs.
I would conclude this write- up with Frederick Reichheld’s quote –
‘Leaders view their best employees as they do their best customers. Once they have got them they do everything possible to keep them.’