Importance of Employee Retention
I recently “stumbled” upon an article on the Cost to hire and train a new employee. For even low wage earners, you can spend up to ½ of someone’s salary replacing them (not including any potential signing bonus). And the reality is there is always the risk that the new hire will not work out. So it never ceases to amaze me how many people take an “oh well” attitude towards turnover. I’ve heard too many executives say, “ Hey, if they don’t want to be here, let them go”. Really? I’ve never understood this thinking. Financially, it makes zero sense. Culturally, it creates an atmosphere that can be toxic. As managers, you can control the turnover on your team. Here how...
Check in with people. Don’t assume because someone isn’t in your office complaining, they aren’t unhappy. In fact, the opposite is often true. People that have stopped caring enough to tell you what’s wrong, are the people most at risk. Take the time to check in with everyone on a regular basis. Don’t make it about a work product. Just ask them how things are going. If the company has implemented a recent change, ask them how they feel about it. Try to get them to open up about any concerns they might have.
Don’t wait to recognize performance. Reward and recognition is not only key to motivation, but to retention as well. If your top performer is doing a great job, make sure everyone knows it. Find the right way to make them know that you appreciate their efforts and results.
Take some personal courage. In this economy, many companies have frozen salaries and mandated cutbacks. But if you feel someone deserves a raise- fight for him or her! Don’t wait until they come in with their resignation letter. By then it’s too late. Even if you scramble to match a competitive offer, the bonds of trust on both sides have already been broken. Your manager may not remember how annoying you were getting someone a raise, but they will definitely remember that your top performer left on your watch. Be proactive!
Be Direct. In addition to checking in on a regular basis, if you suspect someone is at risk of leaving, confront him or her. Sit them down and ask them flat out, “Are you looking?” Find out what motivated them to look outside the company. You may not be able to promise you’ll change everything they don’t like, but you can let them know what you can and can’t do and what you will work on for the future.
It’s easy to dismiss and rationalize turnover with statements like, “ we just won’t pay over market”, or “they were going to leave anyway”, but the reality is that people have to first be motivated to look, or take the call from the recruiter. If you are doing your job as a manager and a leader, most of the time, those two things don’t happen.