What is employee retention? This is a question that has preoccupied managers and HR departments for years. What is employee retention? In a nutshell, employee retention is the capacity of an employer to retain its key employees. How does an employer measure retention? The answer may be difficult but it boils down to one simple statistic.
Employee turnover costs companies millions of dollars every year. While it is difficult to pinpoint the exact cost of turnover, it is safe to say that without good employee retention strategies, these costs would be much higher. There are several different factors that impact the turnover rates of individual team members, but turnover costs can be lowered by addressing some of the more basic causes. By identifying and addressing these causes, you can improve the overall efficiency of your company while reducing your organization's cost of health.
One of the most common reasons for high turnover rates is that there is inadequate communication between management and team members. Teams need to feel like they can voice their opinions and get answers. If a manager does not understand the thoughts of his team members, he will not be able to act in the best interest of the team. One way to create a sense of communication with your team is to host weekly or monthly office hours where all team members can meet face to face. Having face-to-face meetings also allows for open discussions that may address issues that may be inhibiting team productivity.
Another way to look at what is employee retention, reduce the rate of turnover is to promote a healthy work-life balance. Too many people today are living from paycheck to paycheck. When a person works long hours for little pay, this can create stress on his family. When a person has difficulty maintaining a healthy work-life balance, he may feel that his work-related energies are being consumed by his family. This can lead to emotional stress, which can also lead to burnout and increased turnover rates.
One way to encourage a healthy work-life balance is to provide an appropriate benefits package for your employees. Some companies allow employees to purchase wellness programs that provide exercise and other physical activities on the job. Other companies offer small cost-of-living allowances to employees who want to enjoy a more comfortable work-life balance. Healthy benefits and an appropriate benefits package can go a long way in providing the morale boost with your organization needs to encourage retention.
One of the other important factors in what is employee retention and the successful operation of your business is the succession planning you do for new hires. As you prepare for each new hire, make sure that you give him a well-planned succession plan. Include several goals for the new hire in the succession plan, so that he knows what he is getting into. You may also need to include incentives such as paid time off or short term family holidays in your plan if your company offers any of these benefits.
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