For several years, industry experts have warned of a pending retention crisis and the need to have a retention plan in place. If you havent done so already, its time to take this problem seriously and heres why. According to TalentKeepers, the annual cost of employee turnover in the United States is a staggering $5 trillion. Furthermore, with the exit of the baby boomers from the workforce, the US Bureau of Labor has predicted 10 million more jobs than workers by the year 2010. How prepared is your organization? Here are four steps to improve employee retention rates and decrease the impact of attrition on your organization: 1.Measure turnover and calculate the costs of turnover within your organization. Management and HR professionals alike may be struggling with the ability to put retention efforts in place when their organizations are facing tighter budgets. Therefore, it is important for HR to calculate the costs, both tangible and intangible, associated with turnover and to educate their organizations on how retention efforts can actually save money in the long-term. The obvious costs are financial costs resulting from decreased productivity, replacement costs of employees whove left the organization, the expense in time and money for training new employees, and other indirect costs of recruiting and hiring new employees. Remember to consider the costs of workflow interruptions when employees leave, decline in the quality of service, loss of expertise and business opportunities, impact on the job satisfaction and morale of remaining employees, as well as the image of the organization. Measuring turnover can help you determine the causes of attrition and the best strategies to retain talent in your organization. It also allows you to do a cost/benefit analysis of existing or proposed retention efforts. This is a perfect opportunity for HR to show the impact it can have on the organizations bottom line by putting retention programs in place before the mass exodus begins. 2.Identify the variables leading to turnover for your organization. In other words, ask yourself why do employees leave or say they would leave? The variables might be compensation, benefits, management style, working conditions, or a combination of these or other variables that are affecting job satisfaction. The best way to gather this information is to ask current employees. This can be accomplished through mechanisms such as employee attitude surveys, focus groups, structured interviews, or informal feedback. You may also consider gathering data from senior management, exit interviews with former employees, and even applicants who have declined job offers from your organization. 3.Construct a plan to support your employees. Once youve identified why people would leave your organization, put a retention program in place that specifically addresses those reasons. Keep in mind that retention programs need not be financially burdensome in order to be effective. Here are some ideas for keeping employees satisfied now: Provide equitable and competitive compensation and benefits packages. Consider conducting internal and external analyses to determine the fairness and competitiveness of your compensation and benefits packages. Promote diversity. Mandate diversity training for managers to foster a work environment that encourages individuality and acceptance of unique work styles Employees who feel their differences are valued, not just tolerated, are more likely to remain loyal to their organizations. An added bonus is increased motivation and productivity from your workforce. Foster a learning environment. Identify the needs of your workforce and offer opportunities to obtain knowledge and skills for professional growth within the organization. If you already have a tuition reimbursement program in place, remind employees that its available and encourage managers to motivate their employees to take advantage of the program. Identify opportunities for career development for top-performing employees. Establish career development plans for these employees that highlight opportunities for more challenging work. Implement recognition and/or reward programs at all levels of the organization. Employees may have very different motivators, so build flexibility into such programs to keep rewards individualized. For creative and inexpensive ideas, check out Rosalind Jeffries 101 Recognition Secrets: Tools for Motivating and Recognizing Todays Workforce. Foster positive employee relations from the top down. Evaluate communication channels and make improvements where necessary. Make positive employee relations a part of managements performance goals. Implement work/life balance programs to the extent possible. An increasing number of Americans are redefining success in terms of quality of life instead of financial terms. Acknowledge non-work priorities, offer work-scheduling options, and make it acceptable for employees to exercise those options. Ensure that your performance management system is working. Not all retention is good. High performing employees want to know whats expected of them and whether or not they are delivering on those expectations. They also want to know that their colleagues who dont share their desire to perform well are handled appropriately. Keep employees engaged. Survey your workforce to determine how your employees feel about their work, supervisor, and the organization. Engaged employees feel that their supervisors care about them as people. Among other things, they feel that their opinions count and that their development and growth in the organization is encouraged. The bottom line is that engaged employees are more productive and loyal employees. Have fun at work. The concept of a fun workplace has grown in popularity and can be as simple as holding contests or theme dress days or arranging a surprise picnic in the company parking lot. Encouraging employees to have fun at work serves to reduce workplace stress and monotony. 4.Monitor and evaluate the effectiveness of your retention program. Once youve implemented a new or modified retention program, calculate the return on investment by continuing to measure turnover and track improvements that are a direct result of the retention efforts. Or, if turnover rates are not improving, use this data to start over in terms of identifying other possible cause(s) of turnover. As you plan your retention program, be prepared to work harder to retain the top-performing employees you have been able to retain during the downturn. Remember, its your most talented people who are most marketable, and most likely to move on when the opportunity arises. |
