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Optimize Employee Retention

How to Optimize Your Company for Employee Retention

by MicroStartups.org

Imagine finding a wilting plant in the wild and transplanting it to your garden for emergency treatment. As the weeks and months go by, you shelter it from the elements, nurture it as best you can, and are rewarded with a beautiful assortment of blooming flowers. If you lost that plant for whatever reason, you could get one just as nice — but it would cost you heavily, and it simply wouldn’t feel the same (lacking the sentimental value).

Now apply this reasoning to recruitment. When you hire someone with potential and develop their skills, you save money in the long term and form a rewarding bond. Sure, you can throw money at someone with more experience, but that connection — with you, with your other employees, and with your clients — will be lost forever.

The analogy is lacking in one vital way, though: the longer someone works for your company, the more knowledge they soak up about its ethos, atmosphere, and general operation. This has huge significance for the value of long-term employees. They’re generally cheaper (owing to loyalty), more dedicated, more invested, more knowledgeable, and more skilled in the necessary areas than comparable candidates you could source today.

Because of this, it’s hugely important that you invest in your company culture to keep people around. Putting time, money and effort in new hires that end up walking away instead of climbing your corporate ladder is a massive waste of resources. But it’s easier said than done, particularly in this time of varied business opportunities and remote working — how do you keep people around? Well, let’s look at some tips for how you can manage it:

Recognize and Reward Great Performance

One of the most common reasons for an employee leaving to seek new opportunities is the feeling that their work isn’t being adequately appreciated. The fundamental model of business is simple: I’ll do something for you if you’ll compensate me accordingly, and if our respective terms are met, then we’ll have an arrangement. And if I no longer feel that I’m being correctly valued, then that arrangement will break down, and I’ll want to end it entirely if it doesn’t get fixed.

Different people require different things to feel valued, of course, so it isn’t as simple as paying your employees what they’re worth to your company — but that’s a core part of the equation, so get that right as a matter of priority. You’ll need to discuss it with your employees. Ask them on occasion whether they feel they’re being paid enough (people often feel they’re not), and reassure them that you won’t consider them unreasonable if they believe they’re worth more.

After that, offer perks, benefits, and even bonuses to keep employees motivated to work hard and further themselves. You must also provide opportunities for growth and promotion, because benefits won’t be enough indefinitely. Lastly, keep in mind that it’s nice to simply be acknowledged, so make a habit of offering some basic praise.

Smooth Out Typical Points of Friction

No business runs with optimal efficiency, and it’s easy to accrue daily routines or hiccups that are awkward and/or frustrating for your employees. Take something like admin, for instance: your employees may broadly be happy with their jobs in principle, but if they’re being called upon to spend much of their time working on laborious admin, they’re likely getting irked.

When I talk of points of friction, though, I don’t just mean the things that take up a lot of time. I also mean everything from major grievances (payments being late, managers being unreasonable) to minor annoyances (the things that can be trivial in isolation but are quite significant when taken on aggregate, like odd smells in the office or commuting delays).

So do what you can to clear up any issues. If needed, use virtual assistants to clear up admin (UpWork is pretty solid for this). Automate your payroll so everyone gets paid on time (the latter is certainly more widely-known, but I’d go with Wave over Quickbooks because the free version is fully functional). Let employees work remotely where possible to take commuting out of the equation — done well, it shouldn’t hit productivity, but should help significantly with morale. The fewer points of contention remain, the happier your employees should be.

Invest in the Health of Your Employees

Whether it’s physical health or mental health, the condition of your employees doesn’t just matter for keeping their productivity high — it also has a massive impact on employee retention, because it’s entirely possible for someone to leave because they’ve hit the point of burnout. And if you lose someone for that reason, it’s just as bad as losing them to a competitor. They’re very unlikely to come back to a company that let them work to exhaustion.

You need to implement solid policies regarding employee health and wellbeing. Let employees take time off when they need to — you can work around it. Ask them how they’re feeling, and support them however you can. Take action to encourage healthy habits: eating sensibly, getting exercise, finding ways to mitigate stress. Rise has some great examples of employer wellness programs to inspire you: if you show that you actually care about how your employees are, they’ll also feel more appreciated, so the benefits are wide-ranging.

Keeping your best employees around is key to the long-term health of your company, so don’t trust to hope that they’ll stay with you. Take action to optimize your company for employee retention, and give people plenty of reasons to stick with you.

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