Consider the fact that each time a long time employee leaves a business, they take with them valuable knowledge and skills directly to your competitor which then leave a significant shortfall in the company. Staff turnover brings many costs to a business, and they are not all financially related. High levels of turnover that are left unchecked can be crippling to a business, so be so part of any way for a business to manage risk involves developing (and implementing) a staff retention plan.
Why is staff retention so important?
- Keeps knowledge and skills in the company. Established teams have the skills and knowledge to do the job well and have taken time to build successful relationships with team members, suppliers, clients and customers. Often these knowledge and skills go directly to the hands of one of your competitors when staff leave the business.
- Hiring is a time consuming and costly process. The less turnover of staff the more you can spend time focusing on the business, and less time recruiting and training new staff to catch up to where you were before.
- Maintains good morale in the team. The more turnover increases, the more likely that other staff will follow suit as workloads can often increase and anxieties in the team can increase. On the other hand the more stable a workforce, the more loyalty of team members in that organisation.
- Loss of valuable skills and abilities which can reduce business competitiveness in the marketplace and overtime make it difficult to attract new talent.
- Retention of staff maintains performance and productivity. When a position is vacant there is less productivity in the team, and it often takes time before the new employee is up to speed and the position becomes profitable.
As rates of staff turnover increase, the associated effects can snowball and can be both damaging and disruptive to a business. While in some industries it may be easier to replace staff, retaining top performing staff is something that in the interest of any company for the above reasons.
Addressing the reasons behind turnover
It’s not enough for employers to simply introduce benefits in a bid to retain staff, although this can be one effective way to increase motivation. The reasons for high rates of turnover can be diverse with clear reasons and sometimes less than clear reasons. However high levels of turnover is no accident, and retaining staff isn’t just be chance either. Employees stay in jobs where they feel valued and are happy, and leave positions when the feel something more attractive is available.
Understanding the reasons why people stay or leave is the secret to retaining staff and avoiding costly turnover. Conducting employee exit interviews and undertaking staff satisfaction surveys can diagnose any problems which may be present which can then be addressed in a staff retention plan.
Proven measures to retain staff
Management and organisational research has shown some of the most important areas to look at to retain staff include:
- The right hiring process. Hiring the right people who have a history of stable employment and commitment to their workplace should be part of a recruitment strategy. It is also essential to give a realistic preview of the role and be clear with the requirements so there is not a mismatch of expectations with new recruits.
- Rewards and recognition schemes must be in place to reward work that is done well and appreciate staff. Employees who feel valued will be reward their employer with increased loyalty and commitment to the business.
- Remuneration. The pay rate of your team should be fair according the market. Opportunities for pay increases should be available and linked to performance.
- Workplace flexibility – This can include job sharing opportunities, compressed working weeks (i.e. a four day fulltime week,) and allowing employees to work from home if possible can all be strategies which make your business a place where people appreciate the flexibility that their employer is willing to provide.
The best employees are the ones which are the hardest to replace so it makes more sense thinking about how you can retain staff instead of what the plan for replacing them will be.
The team of human resource consulting specialists at Harrison Human Resources can work with your business goals by implementing staff retention strategies that will work with the unique dynamics of your business and industry. For more advice, contact our Brisbane based HR consultants today on 1300 544 803