How to Retain Valuable Employees: Successful Employee Retention Strategies

Employee retention is a very common challenge among managers. Companies faced with high employee turnover are in search of successful employee retention strategies. The Great Resignation triggered by the Covid-19 pandemic does not seem to be slowing down as expected by the experts. Therefore, it is clear that firms and managers need to pay extra attention to employee turnover and spend more time developing successful employee retention strategies and tactics.

What is Employee Retention?

Before we discuss the reasons for high employee turnover and offer strategies to address them, it is important to define employee retention.

Surprisingly, many managers do not have sufficient information about employee retention. According to CIPD, the term, employee retention describes to what extent a firm manages to retain its employees. You can measure employee retention following way: determine the specific time period that would describe retained employees. For example, you might want to count only the employees that have been employed for more than 1 year. Then, the retention rate can be expressed as a percentage of the overall workforce.

If you have 109 employees that have worked in a company for more than 1 year while your workforce consists of 161 people, then your retention rate would be 109/161 * 100 = 67.7%. This means that your company is capable of retaining 67.7% of its employees. Whether this is concerning or not depends on the industry, firm, and management style. Usually, service industries experience low retention rates and high employee turnover.

Why do Employees Quit?

The pandemic triggered the Great Resignation due to a variety of pandemic-related reasons. However, even though the pandemic is not as big of an issue as two years ago, the quitting rates haven’t slowed down as expected. This makes us think that there are bigger underlying reasons behind high employee turnover. This development also suggests that managers should seek more sustainable and successful employee retention strategies.

7 Reasons Why Employees Leave Their Jobs

1. Employees seek new challenges
2. Unsuitable work environment
3. Lack of motivation
4. They are seeking higher salaries and better benefits
5. Employees experience work-related stress and burnout
6. They are looking for better workplace relationships (with peers as well as with managers)
7. Seeking career advancement and new skill acquirement

There are common reasons why employees quit or are actively looking for new jobs. Some of these reasons were intensified by the pandemic and remote work. Many employees have said that after working remotely it was hard getting back to the office. Being back in the office clearly showed many employees the realities of the workplace: toxic relationships, repetitive tasks, low salaries, and more. Overall, the pandemic changed our expectations for the office and workplace. It exposed the structural flaws of corporate life. Moreover, after spending more time with our loved ones lot of us realized that our job does not offer a healthy work-life balance.
All of these reasons create a good background for reviewing existing employee retention strategies and coming up with better ideas.

Successful Employee Retention Strategies

If you are a manager that is stressed out by high employee turnover, we have proven and successful employee retention strategies for you. Furthermore, keep in mind that nothing is simply negative, every issue comes with different perspectives. In this case, you can choose to be optimistic and look at the current situation as an opportunity to identify and fix systematic corporate issues that cause low employee retention rates.

1. Recruitment, Onboarding, and Orientation

Often the reason why employee quits is that they were not supposed to be hired in the first place. You might have hired a qualified person with relevant skills but that does not mean the person was a match for the corporate environment you have. Therefore, overviewing and improving the whole recruitment process would improve your retention. More specifically, ensure that the following tasks are completed during the hiring process:
• Set clear expectations regarding the company and position you are hiring for
• Ensure the candidate’s personality is compatible with the company and team
• Do not oversell the firm during the recruitment process
• Inform the new employee about their responsibilities and goals very clearly
• Help the new employee become the true team member

2. Create Effective Communication Strategy

Firstly, teach your managers and supervisors how to communicate with their subordinates. Encourage communication between peers as well as between employees from different levels. Create a respectful environment for better communication through corporate guidelines.
Keep in mind, employees often quit because of their toxic workplace relationships. By establishing better communication strategies you will improve the retention rate.

3. Employee Training and Development

As mentioned above, employees seek professional development and often quit due to a lack of opportunities. So, believe in your team and invest in their development. This way you will create more incentives for employee retention.
Another strategy you could try in terms of employee development is internal promotion. Establish the culture of internal hiring when you have openings. This will not only motivate employees to work harder but give them a feeling that they have a future in your firm. Hence, there is less chance they will quit.

4. Flexible Workplace

Another excellent employee retention strategy is implementing flexible workplace practices. We couldn’t stress enough how important this is. Nowadays workplace expectations are simply different from what were five years ago. Employees expect more flexibility when it comes to working. You could improve workplace flexibility by introducing the following ideas:

1. Implement a flexible work schedule
2. Allow hybrid work
3. Introduce more benefits such as increased vacation time, more day-offs in a month, better insurance
4. Make your company more versatile by investing in new technologies

5. Support work-life balance

You can encourage better work-life balance by implementing the changes offered within a flexible workplace strategy. However, more important than that is your attitude towards the work-life balance of your employees. Openly supporting employees’ well-being will be positively perceived by your employees. This way you can increase employee engagement, ensure the mental wellness of your team and reduce the reasons why people might want to leave your company.

5Rs for Employee Retention

In addition to trying the strategies mentioned above, you should also try your best to nurture employee relationships.

One of the best-proven blueprints for cultivating healthy employee relationships is 5Rs. 2012 article in Harvard Business Review by David K. Williams and Mary Michelle Scott offers a list of Five Ways to Retain Employees Forever:

• Responsibility

• Respect

• Revenue-sharing

• Reward

• Relaxation time

Even 10 years after the publishing of this article it remains relevant and offers effective employee retention strategies. So, with all these different employee retention strategies you should be able to decrease the most common reasons for high employee turnover. Remember that when implementing the strategies try to make every activity employee-oriented. After all, all of us appreciate the environment in which we are respected, seen, and appreciated.