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Each time an employee
permanently leaves your organization, he or she is adversely affecting
your company’s bottom line. Consider this: according to the U.S.
Department of Labor, it costs a company one-third of a new hire’s
annual salary to replace an employee. Using a modest annual salary of
$35,000, a company can easily spend $11,550 for each new employee hired. This figure comprises both direct and indirect costs. Direct costs include advertising expenses, sign on bonuses, headhunter fees and overtime expenses. Indirect costs include management’s time involved in recruitment, selection and training and decreased productivity while current employees pick up the slack until the new hire is up to speed. To make matters
worse, today’s low unemployment rate makes finding qualified employees
increasingly difficult. The most recent statistics dated March 2000
reveal the national unemployment rate to be a mere 4.1%, which is lowest
it has been since 1970 when the unemployment rate dipped down to 3.9%.
This low figure means longer than normal recruitment periods as well as
increased advertising expenses to fill the position. So what’s a company
to do? The most obvious solution is to retain each and every qualified
employee who currently works for you. However, for many companies,
retaining employees is easier said than done. Competing organizations
may attempt to sway your employees away with offers of more money or
more perks. Or your employees may willingly seek employment elsewhere
when they no longer feel important to your organization. No matter what the
reason for your employee turnover, there are ways to strengthen your
employee retention figures. Below are five employee retention tips that
will keep your employees happy and eager to be a part of your team. 1. Build Strong
Relationships with Every Employee While your employees
may be your subordinates, they’re also an integral part of your
company’s success and deserve to be treated with kindness and respect.
Unfortunately, even though an employee may do a stellar job, you may not
particularly like him or her as a person. When that happens, you still
need to develop a strong business relationship with the employee. This
assures there will always be a smooth flow of information. If you don’t
build relationships and share information with your employees, they may
feel unimportant and unappreciated, and may become disgruntled enough to
leave your employ. The best way to
develop relationships with your employees is to find some common ground
and build connections from there. The next time you’re in an employee’s
office or cubicle, look around and find one item you can comment on that
has relevance to your own life. For example, suppose your son is
involved in Little League baseball, and your employee has a photo of his
or her child in a baseball or some other team uniform. By commenting on
the photo and stating your relevance, you’ve just established a common
bond and made your employee feel a connection to you. Do whatever
possible to find something you have in common with each employee. 2. Offer Praise
Freely As often as possible,
you need to give your employees compliments about their work. Praise
them whenever you can and preferably in public. This not only builds
their morale, but it also shows that you care about their self-esteem
and that you’re on their side. When you think about
it, don’t you want to be around people who praise you and tell you
good things? Of course you do. You most likely seek people like that out
and want to do things for them to show your appreciation. Your employees
are no different. They need to feel appreciated for a job well done. In addition to
praise, always defend your employees when necessary. If they make a
mistake, don’t berate them or act harshly towards them, especially if
in public. Let your employees know that while mistakes aren’t desired,
you anticipate them and treat them as training expenses. When your
employees aren’t fearful of your wrath, they’ll be more apt for
creativity and out-of-the-box thinking, which can greatly increase your
bottom line. 3. Truly Listen to
Employee Feedback Your employees will
gladly tell you their needs and job-related issues. You simply
need to listen to what they say and not dismiss their thoughts as
wishful thinking or unimportant. Listening involves so much more than
simply not talking. It’s a matter of understanding your employees,
giving them your full attention, and making them feel important. To know
if your listening skills are up to par, ask yourself these questions,
“Does my mind wander when I’m listening? If so, how do I bring it
back?” “Do I make silent judgments about the other person?” “Am
I thinking of what I am going to say next or am I truly listening?”
“Is the other person talking more than I am?” Your honest answers
will help determine where your listening skills can be improved. When you listen and
learn your employees’ motivations and goals, you can better sell them
on future concepts and projects by using their own motivations. For
instance, should an employee want P&L
responsibility, but you know the person is not ready for that
task yet, give him a project that has a distinct budget around it and
let him work with it. Be upfront that this is a learning step needed
towards meeting the P&L goal. By doing this, you make the employee
feel as if he’s advancing professionally, while you delegate one of
your tasks and create the time to focus on other projects. 4. Keep the Mood
Light One of the easiest
ways to retain employees is to create a fun work environment. People
naturally want to sense a feeling of belonging, and having fun in the
workplace goes a long way toward making people feel a part of things.
When you get people to laugh with you, you’ve formed an instant bond.
The fact that you were able to let down your guard and laugh breaks down
rank barriers and builds camaraderie. Studies have shown
that humor also helps alleviate stress. And when your employees are less
stressed, they’re more willing to put in extra hours and get the
project done. To foster humor in your organization, post appropriate
jokes and funny stories on the company bulletin board or via email. You
could also initiate theme dress days to lighten the mood. Or if you’re
feeling more daring, don a clown wig and red nose for your next meeting.
Your employees will appreciate the chance to laugh their stress away. 5. Continually
Strengthen Your Team Your company is only
as strong as your weakest employee. Keep developing your team to make
your unit as powerful as possible. If you initially hire second-rate
candidates, you can expect high turnover. However, when you strive to
hire those people whose strengths are your weaknesses, the entire
company benefits. Always remember that
one bad apple can spoil the whole bunch. If your employees sense that
one person isn’t pulling his or her fair share, they will feel
resentful and be more apt to goof off. Whenever you hire additional
help, do whatever possible to make sure the new hire meets your criteria
for a long-term, productive employee. Since the current unemployment rate suggest that it’s an “employee’s marketplace,” employers need to do whatever they can to retain their current staff and attract the best possible candidates for future employment. When you transcend typical employer stereotypes and create a work environment that fosters creativity and success, your company will benefit. The end result will be a workforce that stays with you and a business that thrives. |
