According to a recent article in The Wall Street Journal, employee turnover costs companies more than double an employee’s yearly salary. Finding and training a replacement takes financial resources as well as management time and energy. Additionally, turnover can often hurt office morale and disrupt critical client relationships.
Experts agree that the best way to deal with employee turnover is to prevent it. Here are five solutions that can be used as tools to help you keep employees happy and reduce turnover in your business.
1. Have An Effective Hiring Strategy
No matter how hard you try to acclimate a new employee to your office, the wrong fit is just the wrong fit. Creating and implementing a hiring strategy that addresses more factors than simply the skills of job candidates is the best way to find the perfect match for your work environment. The most skilled worker may not always be the one you want to hire. The right candidate blends well with company culture, management, and coworkers. We recommend testing your employee prior to hire. Also, you want to make sure not only that the prospective employee is a good fit for your business, but that your business is a good fit for the future employee. Even if everything meshes well on paper, partnerships fail without proper chemistry.
2. Review Your Compensation and Benefits Packages
Compensation is about more than money. While salary is certainly important, employees will often opt for a position that pays a little less but offers more benefits. Things like health insurance, paid vacation days, maternity leave, and paternity leave are crucial to individuals with families. People consider the entire package when making an employment decision, so you want to offer as many benefits as are feasible for your company.
Take the time to review your compensation and benefits package each year. While more pay has shown time after time not to impact engagement greatly, inadequate pay is a morale killer. By reviewing your package each year, you’ll stay on top of industry trends and continue to maintain a competitive edge in your niche.
3. Provide Effective Feedback
Most of the managers we work with are well trained in providing critical feedback in order to correct a behavior or performance issue once it has occurred. Few managers, however, are trained or practiced in providing positive feedback – the sort that gives employees the opportunity to know when they have done the job well and the chance to know why it matters to the company. We spend a lot of time giving our children positive feedback and yet deny them any sort of reinforcement once they enter the workplace. To keep your employees engaged, especially your younger millennial workers, take the time to observe and comment on what your employees are doing well – they’re much more likely to repeat the behavior in the future.
4. Remember Appreciation and Rewards
Employers often overlook the importance of showing appreciation to current employees. Many workers leave their jobs because they sense a lack of gratitude from management for all their hard work. Don’t let that happen to you. A simple thank-you email, modest bonus system, or recognition in the company newsletter are just a few examples of the ways you can show employees that they’re vital to your success. A little effort goes a long way, and any rewards you invest in will be well worth the resources spent in the long-run.
5. Keep Them In The Loop
Engaged employees are those that know where the company is going and know how they contribute to the organization’s overall success. Everyone from the CEO to the receptionist should know the organization’s values, mission and strategic objectives so that they can work toward helping the company achieve them. A well-informed employee is a happy employee.
What’s Next?
It’s no secret to business owners that employee turnover is a costly, timely, and frustrating issue. It takes significant resources to find and train new employees. The process often leaves current staff short of help and takes them away from their daily responsibilities – which means productivity suffers. And when productivity suffers, revenue suffers. So in the long-run, low employee retention rates have the power to hinder the success of a business.
While some turnover is to be expected, implementing the approaches mentioned here is a simple, effective way to reduce turnover before it becomes a problem. Give us a call if you would like to explore more tips on maintaining a positive, productive workplace.
By Margaret Jacoby, SPHR, President of MJ Management Solutions, Contributor – Affinity HR Group
More Blog Entries
