The quality of leadership, culture and values of a company can be determined by its employee retention. Top companies have excellent employee retention because of how they manage, value and treat their employees.
Having good employee retention is rewarding. On the other hand, having low employee retention is detrimental and can be enough to cause the downfall of your organization.
To give you an idea, a study conducted by Employee Benefit News showed that the average cost for an employee exit is 33% of their annual income. Moreover, if your workforce is not engaged, they are less productive and their performance can be average to poor.
By improving employee retention, you also improve:
- Company Culture
- Employee Productivity
- Employee Performance
- Customer Experience
Employee retention is the result of good company management. Here are a few steps for you to improve employee retention.
Create a Positive Company Culture
Company culture is everything. Employees value culture and benefits over money. In fact, according to Hays, 47% or nearly half of employees consider culture their main reason when looking for a new job.
More than improving employee retention, there are more other benefits for having a good company culture. With a positive and strong company culture, employees are more motivated to work harder and better.
There are a lot of ways on how you can develop a good company culture. Here are a few that you can do right away.
- Greet your employees
- Calling employees by their name
- Giving compliments
- Showing appreciation
- Being accountable
- Becoming solution-oriented and not focusing on problems
- Complimenting excellent work of others publicly
- Listening to employees’ input
Being empathetic and a good role-model sets the beginning of building a positive company culture. Another benefit of having a good company culture is strengthening the engagement of workers.
If workers are engaged, your organization can become 21% more profitable. This is according to a research conducted by Gallup. Another study from Gallup also showed that engaged companies have a 59% reduction in turnover rates.
With an excellent company culture, you not only improve employee retention but you are also getting higher revenue.
Hire the Right Employees
An employee exit or replacing an employee has a high price tag. This is even more true if the employee is highly-trained. According to PeopleKeep, the cost of replacing an executive-level employee can be more than double their annual income.
Hiring the right employees can help out with retaining or improving employee retention because bad or toxic employees can affect company culture. Bad hires can affect other employees in a negative manner that can cause them to become less productive.
On the other hand, having the right employees for the job with personalities that fit into the culture can be beneficial. With hiring, remember that no hire is better than a bad hire. Research has shown that rude employees have a significant effect on their coworkers.
Here are statistics about the influence of toxic or bad employees among other employees according to Harvard Business Review:
- 63% lost work time avoiding the offender.
- 66% stated that their performance declined.
- 78% mentioned that their commitment to the organization declined.
- 12% said the reason why they left their job was because of uncivil treatment.
- 25% admitted they took their frustration out on customers.
As you can see, bad hires and bad employees can cast away other workers and even clients. To improve employee retention requires weeding out employees with a troublesome attitude.
Provide Competitive Employee Benefits
Employee benefits is one of the most critical elements in keeping workers. In fact, one of the main reasons why a lot of companies offer generous and competitive employee benefits is to keep and attract valuable employees.
According to studies, employees even value benefits more than they do money. A study by the American Institute of CPA showed that a whopping 80% of employees would rather keep their jobs with employee benefits than to accept a job opportunity with higher pay but with no benefits.
Another study from Willis Towers Watson concluded that 78% of employees said they choose to stay at their jobs because of the employee benefits. According to Zenefits, 60% of employees are even willing to accept a lower paying job that has better benefits.
Offering competitive employee benefits also shows that your company cares for its employees. Good employee benefits is linked to employee satisfaction, productivity, engagement and higher employee retention.
It also improves morale and helps build a good company culture. Offering good employee benefits is so significant that an organization may become irrelevant if it lacks employee benefits.
If you want to improve employee retention through benefits, it doesn’t mean that it requires a gargantuan budget. There are a lot of options that don’t even require financial costs.
To give you some examples, this could be having reduced hours, flexible working schedule programs, working remote and more others.
Employee retention matters because the workers are the reason having businesses are possible. If your business runs low on and keeps on losing employees, the business can become a failure.
To take care of your business, you have to take care of your employees. The measure of how you value your employees is through their retention. Again, for you to improve employee retention, just remember to:
- Create a positive company culture
- Hire the right employees
- Provide competitive employee benefits
Valuing your employees is how you take care of a business. Implement what we shared and you are sure to improve employee retention. As what Zig Ziglar said, “you don’t build a business, you build people and then people build the business.”