5 Effective Strategies for Employee Retention
Effective hiring and retention practices are key to effective leadership. The reality is that managers that hire well and that are able to keep talented employees produce better results. Replacing employees is time-consuming, expensive, and disruptive. Plus, when an employee leaves, it can impact the entire team and cause a ripple effect of unhappiness or turnover.
So all managers should prioritize a strategy to help ensure a high level of employee retention. Obviously, this strategy should include some of the basics like a competitive strategy, engaging work, and a respectful environment. However, in the current environment, it’s important that leaders go beyond these basics to retain the most talented employees. With that in mind, here are five strategies to include as part of an effective employee retention strategy.
Ensure that all managers are effective leaders
There’s a common adage that employees don’t leave businesses, but they leave bad managers. While this oversimplifies things a little too much, it’s still a message that all leaders should keep in mind. Ultimately, avoiding having bad managers is an effective way to reduce employee turnover.
This means that leaders need to be proactive about developing their own managerial skills as well as the managerial skills of all leaders throughout their business. As PepsiCo CEO Indra Nooyi advises: “If you want to improve the organization, you have to improve yourself and the organization gets pulled up with you.”
Meaningful development of managers is done by investing in leadership and consistently working to develop the leadership skills of all managers. Whether it’s a formal leadership course, regularly coaching meetings with managers, or shadowing managers as they work with employees, it’s important that managers are consistently developing their leadership and managerial skills.
Focus on employee engagement
The more engaged that employees are with their work, team, and company, the less likely they are to leave. This means that it’s important for leaders to find ways to get all employees engaged. For many employees, this starts with meaningful learning and development opportunities.
Generally, employees are most engaged when they see opportunities for growth. The late Jack Welch, the former CEO of Generic Electric, described the importance of developing employees by observing that: “Before you become a leader, success is all about growing yourself. After you become a leader, success is about growing others.”
To help facilitate this, managers should find out the specific ways that employees want to grow and then develop a personalized path for them to do that. Doing this gives your employees clear systems for advancement, shows them that you care about their advancement, and gives them tangible things to work towards.
Beyond finding ways to individually help develop employees, leaders can improve employee engagement through a few other best practices:
1. By offering meaningful and consistent performance evaluations with tangible evidence of employee’s results as well as measurable and attainable goals to work towards.
2. By developing business practices that employees can be proud of. For example, being involved in the local community and supporting issues that employees care about keeps employees invested not only in the company's growth but also in the company's values.
3. By providing mentorship programs that pair employees with others in the organization that can help guide them.
There are a number of ways to increase employee engagement, so it’s simply a matter of finding the right strategies for your organization and employees. Regardless of what methods you choose, it’s important to be aware of employee engagement and to consistently work to ensure that all employees feel connected and engaged with their team and work.
Seek employee feedback
Ongoing areas of frustration that have been left unaddressed can damage employee retention over time. Unfortunately, sometimes managers are not even aware of the damage that they’re doing to employee morale, productivity, and, ultimately, retention.
To avoid this problem, managers should consistently seek and respond to employee feedback. This can be done formally or informally, but it’s important that employees feel comfortable sharing concerns with their managers and that managers hear and respond to those concerns.
Develop a healthy culture
While many of these strategies are part of a healthy work culture, the overall workplace culture is important enough that it should be included in your retention strategy. When thinking about employee retention, it matters where, how, and with whom employees work. For example, teams with close-knit members and a respectful environment generally have less turnover.
There are many components that impact workplace culture, but it’s important to keep in mind that setting the right tone and developing the right culture starts with onboarding. Teaching employees about both their new job and their new workplace culture is an important part of setting the right tone from the start.
Offer thoughtful employee perks
It’s important that employees receive a competitive strategy. However, beyond just salary, thoughtful perks can be an effective way to make employees feel valued and, consequently, more connected to their team and company. Perks can include anything from catered lunches to gym memberships to extra afternoons off.
Whether you have a large budget or a more modest one, there are plenty of perks that you can offer to show employees that you value them and their overall well-being. Get creative with these and find perks that your team members will enjoy and benefit from.
As a leader, employee retention is something that should always be at the forefront of your mind. An effective retention strategy can help to ensure that employees are connected and invested in your team and company, which leads to better outcomes and a competitive edge. While each team’s retention plan will look a little different, these five strategies should help to shape your plan and lead to improved employee retention.