No matter what kind of business you run, losing an employee—whether by termination or them leaving the company—costs you big-time. In fact, according to Deloitte, the cost ranges from tens of thousands of dollars up to 1.5-2X the employee’s annual salary. Whether you run a small business or an industry-leading enterprise, that’s no drop in the bucket.
One simple way to combat these losses is increasing your employee retention. Not only will this cut the costs associated with rehiring another individual, but it will also pay dividends in the long run by increasing the loyalty a worker has for your company—boosting overall team morale.
Not sure where to start? Here are 7 surefire ways to increase employee retention at your company.
#1. Hire the right people.
One way to bump up employee retention is, of course, to start hiring people best fit for your company. This should go beyond skill set, and really dig into who fits well into your company culture and holds similar core values.
If they don’t, talent won’t matter much or get them very far. Having someone who’s a detriment to your culture will only bring down the atmosphere in the office, doubling the damage. If you haven’t done so already, establish what your company culture is and the values you hold dear. Then, find ways to screen for them in all your company interviews.
For instance, if your company has a “family-first” culture, consider asking all your candidates what matters most in their lives. If they don’t mention family, close friends, or their spouse, rethink their candidacy. If your company has a philanthropic culture, ask all interviewees how often they’ve volunteered over the past year.
By front loading these questions in the beginning of the hiring process, you’ll safeguard your business down the line by weeding out individuals who aren’t solid cultural fits.
#2. Have a warm and welcoming HR department.
Making sure all your team members feel welcome and comfortable in your workplace is critical to the success of your organization. Without an open, accepting office environment, it’s unlikely employees will be able to do their best work. To make sure they do feel comfortable, you’ve got to have a warm and welcoming HR department that workers feel they can confide in.
Be sure your workers know they can visit HR with no repercussions or judgment. Otherwise, resentment may begin to set in as the months go by, lowering employee retention in the long run.
#3. Host events on a regular basis.
Hosting regular, after-hours events at your company is a terrific way to increase employee loyalty. Whether it’s company-wide barbecues, quarterly outings, or weekly happy hours, getting to know your coworkers beyond surface-level interactions can go a long way.
This shouldn’t stop at company-wide events either, you should also empower your employees to begin and run their own outings. For example, at Arcoro, a group of workers at ExakTime regularly host game nights—where people come together and play a wide variety of video and board games. Friends enjoy working with other friends, and these more intimate settings are great venues for getting to know your colleagues on a deeper, less buttoned-up level.
#4. Make employee career trajectory clear.
Hiring internally as opposed to looking outside your organization has a couple big advantages. You won’t have to spend the time and resources needed to onboard an entirely new person, and there’s less risk of that individual not being a cultural fit, or just being plain incompetent. This approach will also make employees feel they can grow at your company, which can have a positive impact on retention. In the HR space, mapping out an employee’s potential candidacy for filling an internal job opening is what’s called succession planning.
Succession planning can help illustrate potential career paths available to employees who take the right steps to capitalize on those opportunities. It also allows you as the employer to decide which worker would be most equipped for the opening. BirdDogHR’s Succession Planning software makes this easy—with it, you can compare candidates based on competencies from performance reviews, scorecards, and 9-box Talent Matrices to determine who fits best.
#5. Be upfront from the beginning about what roles will entail.
Communication cures all. If you want to increase overall employee satisfaction so they stay longer, laying all your cards on the table from the beginning is an effective way to do so. Be transparent about salary, potential raises, work culture, typical hours of operation, whether or not your team works weekends, and other important details.
This way, it’s up to the candidate to decide whether or not they’d be a good fit for the position—increasing the chances you continue to hire people who are assets to your company culture as opposed to detriments.
#6. Have consistent performance reviews.
In order for employees to improve and make strides to become better at what they do, companies need to measure their performance along the way. More importantly, employers and managers must make sure employees know exactly what they’re being measured against, how they’re tracking towards those goals, and what the rewards are for exceeding those goals—whether that’s a raise, promotion, or an extra day of PTO.
This doesn’t mean you have to meticulously measure every little aspect of the employee’s job and only be focused on the numbers, but there should be a way to monitor progress. One proven way to do this is by holding regular performance reviews for team members, which can be done quarterly, semiannually or annually. Most HR software, from ADP to Workday to BirdDogHR, have performance review software available on their platform.
#7. Have a company mission that’s loud and clear.
Now more than ever, workers are focused on the mission or high level goal a company is chasing toward rather than being okay with spending 40 hours per week at just any workplace. In fact, according to one study, more than three-quarters (78%) of consumers think it’s no longer acceptable just for companies to make money—they expect companies to make a positive impact on society as well.
Millennials, in particular, have a much higher affinity toward brands with a mission focused on making the world a better place. They don’t want to just work a day job, they want to know their efforts are helping move the needle on something bigger than themselves.
The good news is this can be accomplished easily for any company in any industry simply by reframing your mission. For instance, if you own a tire company, don’t focus only on selling tires when speaking to customers and employees. Instead, position yourself as a company selling safety—a safe trip home from work during rainy seasons. Your tires help the people who keep the economy running move from point A to point B, and that’s important.
By having a strong, tangible company mission, your employees will be more likely to stay with you through the ups and down—boosting retention across the board.
If you’re interested in learning more about the many HCM solutions we offer at Arcoro, including ones to help increase employee retention, get in touch with us by filling out a form here.