10 essential strategies to improve employee retention in your organisation
Employee retention is a major challenge for many businesses. This post outlines 10 essential strategies for how to improve employee retention in your organisation.
In this post:
- Why does employee retention matter?
- 1. Understand why people are leaving
- 2. Identify how to improve employee engagement
- 3. Invest in training and development
- 4. Improve your onboarding process
- 5. Recognise and reward people for their performance
- 6. Embrace flexibility
- 7. Elevate your purpose
- 8. Pay attention to wellbeing
- 9. Connect with people
- 10. Focus on culture
- In conclusion
Why does employee retention matter?
There is a retention crisis at the moment – organisations are struggling to hold on to their talent. No longer is it just the most capable and ambitious people who are leaving , it is spreading to lots of different jobs across different sectors.
One of our NHS clients told us recently that some research in their Trust indicated that the monetary cost of recruiting a new nurse is £10k. This doesn’t take account of the loss of continuity of care etc., and also assumes there are lots of applicants knocking on the door!
The retention crisis is also being exacerbated by the cost of living crisis – lots of employees are having to find alternative jobs that simply pay more. However, the retention crisis actually started before the cost of living crisis really took hold.
During the Covid pandemic many people started to re-evaluate their work-life balance. People towards the end of their working career decided to leave the world of work. Many others realised there was just more to life and that putting up with lengthy commutes each day.
Combine that with the normal changing expectations each new generation of employees has and organisations are now struggling to retain the people they have and attract new people.
All of this means that paying attention to your organisation’s culture and the employee experience is becoming ever more critical.
These are 10 strategies you can implement to begin improving retention in your organisation.
1. Understand why people are leaving
Without a clear understanding of which people are leaving your organisation and why it will be very difficult to put measures in place to reduce the level of employee turnover. You might have a sense of why people are leaving, but the risk is you might focus on the wrong things or miss much bigger opportunities that you weren’t aware of.
Exit interviews are the best known method for gathering feedback from leavers. An exit interview is a conversation between the leaver and someone from the organisation, usually the line manager or HR.
Telephone exit interviews
Telephone interviews are still a conversation between the leaver and someone from the organisation, they are just done over the phone (or something such as Teams or Zoom) rather than in person.
Online Exit Surveys
With online exit surveys leavers are asked to answer your exit interview questions through an online questionnaire or survey rather than during an interview. This makes them much more efficient and cost-effective than face-to-face or telephone exit interviews.
2. Identify how to improve employee engagement
By definition, if people choose to leave your organisation it is because they have become disengaged for some reason.
Employee engagement is a big topic and you can find out more in our post about everything you need to know about engagement, but engaged employees are more committed to their work and the goals of the organisation, leading to higher levels of productivity and job satisfaction.
They are also more likely to stay with their employer for a longer amount of time, reducing turnover rates and associated costs. In addition, engaged employees are more likely to provide excellent customer service, leading to increased customer loyalty and revenue for the company.
The starting point is to design an effective employee survey. This will allow you to identify how all of your employees are feeling about their employee experience. Armed with this information you can start to identify actions that will help improve overall levels of employee engagement.
3. Invest in training and development
Our exit survey data shows that many people leave their organisation because they don’t see a future for themselves, they don’t feel their is any career progression or development opportunities.
Most people don’t want to feel they are in a ‘dead end job’ and providing training and development opportunities is a great way to signal to people that they matter. Employees who feel that their skills are being developed, and that learning opportunities are available to them, are more likely to be engaged and committed to their workplace.
Ensure people feel equipped to carry out their role
At the most basic level, all employees should feel equipped to carry out their role so job training is essential.
Provide opportunities for people to learn new skills
Keeping employees upskilled is especially important in order to adjust with the changing nature of work as technology continues to develop. By providing employees the opportunity to gain new abilities and competencies, it will allow the organisation to stay ahead of industry trends and provide people with a sense that the organisation is investing in them as an individual.
Provide employees with feedback on how they are doing
Everyone wants to know how they are doing, but many managers are poor at giving feedback. Simply engaging with people to discuss their strengths and areas for development can be highly motivational. During these conversations, discuss employees’ professional goals – both in the short-term and long-term – and help them envision a future with the company.
When combined with additional development it creates a sense that the manager cares about the person and sees them as being part of the team in the future.
Show people how their career could develop
Whilst promotion is not guaranteed in any organisation, if people have some visibility of what it takes to progress and the career progression opportunities available to them, they are more likely to invest in their own development and stick around for longer.
Having one to one discussions with people about their future is a great way to talk about strengths and development needs and plan further training and development.
4. Improve your onboarding process
The early experiences that new employees have when joining the organisation can have a big impact on how they feel about the organisation.
The onboarding process is critical to ensure that people feel oriented and integrated as quickly as possible will maximise their level of engagement.
As a minimum managers should welcome new employees to the team, show them around, introduce them to their work colleagues and ensure they receive the essential job training they need.
This process can then be formalised into a more comprehensive induction training programme. This should encompass not only specific job training but also an introduction to your company culture and expectations of how they can thrive in it.
Taking care to provide the necessary support and information, either face-to-face or virtually, is crucial in setting the right tone for a positive working experience and future longevity with your company.
Using an onboarding survey to measure the experiences of new employees will provide you with valuable insight into how you can improve your induction process.
5. Recognise and reward people for their performance
I feel recognised for my contribution’ is one of the key questions we use in our employee engagement surveys and it is one of the questions that has a strong linkage to overall levels of engagement. All employees want to feel that their effort is recognised and appreciated and it can be as simple as a ‘thank you’.
The subject of reward is a tricker one, especially where the current retention crisis is, in part, being driven by the cost of living crisis. As such, the issue of pay is now much bigger than it has traditionally been. So, before we go into any more detail let’s address the elephant in the room…..
Will big pay rises solve the retention crisis?
For a few days, maybe. Over the long term? No!
There is a temptation to assume that there must be some quick fixes for the retention challenges many organisations are facing. The most obvious one is pay. People are telling us they can earn 50p per hour more in Tesco so why work long hours in a restaurant?
The cost of living crisis means that pay is now having a larger and larger impact on overall engagement. We have seen increasing dissatisfaction with pay through our employee experience surveys in the last few months, it also remains true that, when we do the analysis, pay still has relatively little overall effect on engagement.
In other words, whilst people may be dissatisfied with their pay, they still consider other things to be important when it comes to engaging with their work.
Why people come to work is more complex than just pay. Maslow’s hierarchy of needs suggests that pay is, of course a fundamental need. Let’s face it if we won the lottery most of us would stop working immediately.
However, having nothing to do all day might seem appealing, but it actually becomes quite boring. It turns out that we need more out of work to prevent us from getting bored, killing time and waiting for time to go home.
However, what is true is that where people feel undervalued (pay being a core measure of value) they will begin to feel less and less engaged. As such you should ensure that your reward systems are fair and consider communicating the value of the non-monetary benefits your employees receive such as pension, health insurance etc., but informal recognition can actually have a greater impact on overall levels of engagement.
6. Embrace flexibility
Another consequence of lockdown has been to open up the eyes of individuals and organisations to the benefits of working from home and other more flexible ways of working. People now realise that working from home can have significant benefits for work-life balance as well as actually being less expensive than travelling to work every day.
Of course not everyone can work from home all of the time, but the most forward thinking organisations are increasingly implementing more flexible working practices.
Ideas include offering your employees the chance to work from different locations and during different hours that suit their personal lives and schedules, supporting childcare etc.
Offering more flexible working practices can also help you create a more diverse workforce as people who might otherwise be unable to work for you might now be able to do so.
As a minimum, managers should now be demonstrating more empathy when it comes to supporting employees who might be facing challenges that a more flexible approach to work could help with.
Above all, where people feel you care about them they are more likely to remain loyal and committed to your organisation.
7. Evolve your culture
It’s now more important than ever before to show employees that there is more to your organisation than the pursuit of profit, and that they are working towards meaningful goals.
Younger generations have a different perspective on work and they place a greater emphasis on the importance of the organisation’s values and purpose.
There is now significantly more importance attached to diversity, equity and inclusivity. The more forward-thinking organisations are actively working to create a culture of diversity, equity and inclusivity (DEI) as improved employee retention is one of the key benefits of creating a culture which respects DEI.
Make sure to communicate your organisation’s purpose as much as possible, and make decisions and take actions that align with it.
8. Pay attention to wellbeing
If people don’t feel well they will go off sick and be unproductive so employers need to recognise the importance of taking care of their employees’ physical and mental wellbeing.
One example where managers can demonstrate support is for women going through the menopause. Menopause is a lot less taboo nowadays than it has been traditionally, but as the workforce is gradually ageing, menopause is being recognised as having a real impact on organisations.
Quite simply, where women do not feel supported they are more likely to leave the organisation and may even leave the workplace entirely.
As such, managers need to consider how to support and engage women going through the menopause.
The most forward thinking organisations are now providing employees with support through things such as wellness hubs, having resources available at work to support people with financial or mental wellbeing challenges. Managers should be trained on how to support people with wellbeing challenges.
9. Connect with people
The Covid lockdowns taught us all the importance of maintaining personal connections. Taking the time to build a relationship with people will not only help them feel valued, but can have a positive effect on their productivity.
Recent studies show that workers are placing more emphasis on having good relationships with colleagues than they do on many other aspects of their jobs. So, set aside work time to focus on team development activities to strengthen their connection to each other.
The organisations who had higher levels of engagement during the Covid lockdown were the ones who focussed more on communicating with their people. Employers should have scheduled check-ins with team members to get an accurate sense of job satisfaction and workload.
Prioritising solid workplace communication will help employers better understand their teams’ needs and collaborate more effectively.
The other factor that had a positive impact on engagement during lockdown was culture.
10. Focus on culture
If you focus on all of the previous 9 strategies you will be moving towards a much more engaging culture that will reduce the amount of employee turnover you are seeing.
Culture is difficult to change, but there are some key steps you can take to change culture. At its heart, culture is defined by what all the leaders in the organisation say and do, and how they say and do it.
Therefore, to change culture, you need to change how your leaders behave. And by leaders we mean everyone who leads others, from the CEO down to all your first line supervisors.
Organisations should ensure that every single leader behaves in a way that is consistent with the culture you want to create.
The retention crisis is real and unlikely to go away in the short term. However, ‘The war for talent’ is a famous piece of work that was done back in 1997 so retaining your best people has always been a business imperative. Our 10 strategies will give you a strong foundation to begin helping your organisation overcome its retention challenges.