Employee retention is crucial for a business to build client relationships, preserve knowledge and keep high achieving staff within the organisation. Finding an employee replacement can be a lengthy and expensive process. Here are 5 reasons employee retention is good for your business:
- Continuation of Customer Service
The reason why people and businesses trust in other businesses to provide a service is often due to the people. Business is all about networking and building relationships based on trust. When a role has a high turnover within an organisation it can be difficult to build those strong client relationships and regain trust.
When a relationship is developed over time it encourages continued sales and sponsorsorship of a business.
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- Maintaining company knowledge and wisdom
With every role in a business, the longer you are within a company the more you are going to learn. Employee retention is invaluable for passing on the businesses knowledge and wisdom.
Often the handover period for a leaving staff member and a new staff member is not long enough to transfer crucial knowledge to the new staff member.
- Avoiding a lengthy and expensive hiring process
The energy and costs involved in re-hiring can be draining. Often it takes businesses around 6 weeks to rehire for a role. Firstly, it’s finding candidates worthy of getting an interview, then negotiations start and introductions to find a suitable fit.
Once the hiring process has commenced, the business and the staff members are on probation for up to 6 months and may end up being the wrong culture or company fit, which means restarting the process.
- Loss in efficiency
Teamwork is harder to achieve with high employee turnover. Assuming it takes roughly a year for a new employee to gain the knowledge and experience to perform equally to a previous employee, this reduction in productivity and efficiency will result in losses of revenue for the business.
- Good company culture
Employee retention creates a strong company culture, where colleagues know each other on a personal level as well as a professional one. When employees have been in a business for several years it creates a high morale office and a place of open communication.
Implementation of an employee retention program is an effective way of making sure your strong performing employees remain employed.
Try these ideas:
Stay Interviews: Alongside performance reviews, arrange interviews with an employee to open up communication about their progress within the company, rather than in the role.
Some questions could be:
- What makes you look forward to work?
- What do you enjoy about working here?
- What keeps you working here?
- What would be the factors that would tempt you to leave our business?
- How can we help make your job more fulfilling?
Employees like to feel appreciated and valued. Transparency and communication is very important. Most people consider and apply for jobs over several months, but management is only aware when it is too late.
In Australia in 2020, 1.1 million, or 8% of employed people, changed jobs last year. Hence, it is inevitable employees will come and go from your business. Once they have resigned, organise an exit interview:
- How would you describe your working relationship with your colleagues?
- What company processes do you think could be improved?
- How could the company workplace be improved?
- What was the best part of your job here?
As seen above, understanding your employees and keeping them within the business for as long as possible is invaluable to the culture, profit and efficiency of the company.
Feedback from exit interviews allows a new perspective into the company and may raise issues that other employees refuse to mention.
By retaining employees and avoiding hiring costs, lost productivity and poor company culture your business will be better off for it.
