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How to improve employee retention in 7 simple steps

October 4, 2023

Recruitment is expensive. In fact, according to Gallup, the cost of replacing an employee is one-half to two times the employee’s annual salary. Yet, many businesses are experiencing high turnover, which is hurting their pockets.

If your business is struggling to keep employees, or you’re trying to prevent high turnover, here are 7 steps you can take to improve employee retention.

1. Re-evaluate your mission statement

Times have changed. No one wants to simply clock in at 9am and clock out at 5pm, completely alienated from their job. If people spend a third of their lives at work, it is only logical that they would want to pass that huge amount of time doing something meaningful. This is particularly true for the younger generations, with 54% of Gen Z saying they would refuse to work for a company that doesn’t share their values. In the same survey, only 19% said they would be willing to work for a company with different values.

So, when was the last time you’ve examined your values, mission statement and objectives? Make sure they are updated and aligned with your company at this moment in time. You should also consider how you have incorporated those values into your organisation on an everyday level. Anyone can say they are committed to something, but how does it show in the way you conduct your business? Do you involve it in your feedback sessions and 1-2-1s? Do you come back to it in reports? Find a way to really highlight your values and practise what you preach.

2. Gather data

Even if you are experiencing high employee turnover, it’s important to utilise those employees who are still working for you and are committed. Use them to help you glean more information on their motivations and reasoning for either staying or considering to leave. By using surveys and assessments, for example, you can collect data about your current workforce. It’s worthwhile to drill into who they are, and their traits and abilities, but also their level of satisfaction with different aspects of your organisation and their lives.

Once you have this data, celebrate your strengths! However, you should also consider what you can improve based on this information. Where are your employees struggling? What can you do to alleviate this? And what can be done to maintain and develop your assets?

3. Consider your hiring process

No matter how much you evaluate and optimise, your workplace isn’t going to be for everyone. The trick is to find the perfect match for your business and employees. If you fail to make that match, many times, employees will leave because of it — but in most cases, you could have actually predicted the mismatch at the recruitment stage. That’s why considering your hiring process is crucial to lowering turnover rates.

What is your recruitment process like today? How are you making your decisions? Are you basing them on anything tangible (such as assessments or professional tasks) or just a gut feeling? Have you developed a scoring system? Are your interviews standardised? These are the sort of questions that you should include when reviewing your process — and then make sure to use the answers to help you restructure and readjust.

Further reading: How to structure sales interviews

4. Examine your offering

Don’t get us wrong, all this nice stuff is important. But at the end of the day, if you’re offering a really terrible package, even if your values are perfect, no one is going to want to stick with it. It’s important to research this. For example, how do the salaries in your team compare to the market? What about conditions, perks, opportunities for growth?

It’s also important to ask what your employees, in particular, are expecting, and not just leave wages and perks at the market rates. Are you rewarding them according to what they believe they need or deserve?

This doesn’t have to be an expensive business. Usually, with some simple adjustments, organisations can tick more boxes for less. Are you offering anything that no one wants? If no one in the history of your company has ever taken a bike to work, maybe the bike scheme isn’t the best expenditure — instead, you can use the money for something your employees will truly benefit from.

5. Invest in culture

Employees today are fully aware of the importance of their mental health. Gone are the days when people settled for terrible working conditions, but now this also extends to company cultures. It’s fully understandable that no one wants to be in an atmosphere where they feel bored at best, or actively distressed at worst. In fact, research by Deloitte shows 94% of executives and 88% of employees believe a distinct corporate culture is important to business success.

Make sure you are investing in making your company culture the best it can be. There are many ways you can do this simply, for example, by prioritising feedback, recognising accomplishments, and expressing your gratitude.

Further reading: Learn how to assess and improve your business culture

6. Embrace remote and flexible working

Yes, we know you may have heard all kinds of people exclaiming that the return to the office is here. Unfortunately, your employees disagree: 77% of employees would actively look for a new job, or be willing to consider one, if their company’s flexible work policies were to be reversed. It’s a no-brainer that, in this post-pandemic world, if you want to increase your retention you should accept flexible and remote work.

At the end of the day, your employees want to have the ability to maximise their work-life balance. However, it’s important that you ensure that your business can fully operate under these conditions. Ensure that you have the right facilities, software, and equipment to support your employees, and create a culture of acceptance and accountability.

Further reading: Learn how to do remote work right

7. Repeat the process

A business’s most vital quality is agility. With things changing almost daily, you have to make sure you repeat the process multiple times. Continuously re-evaluate and adjust to stay ahead in the game and ensure that your retention rates remain in an upward trend.

Want to learn more about how Thrive can help you increase your retention rates? Book a demo with us today.

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