Netflix sets the benchmark for highly regarded and successful companies. Employee retention plays a key role in its success. Netflix uses more than just good pay and benefits to retain workers. A range of strategies factor into employee retention. But you don’t need to be the talk of the Emmys to keep your best people.
What Is Employee Retention?
Employee retention refers to your company’s ability to keep its employees. It is usually measured as a percentage: A 75% annual retention rate means an organization keeps 75% of its employees while losing 25%. So, employee retention is simply keeping employees working for your organization instead of leaving for a new opportunity.
Employee retention fosters team building and cohesion among your teams. The longer your employees work together, the greater their trust in, and reliance upon, each other. Conversely, high employee turnover can hurt a firm. Replacing an employee who leaves is expensive, with some estimates as high as twice the salary of the lost employee. In addition, continuity deteriorates and institutional knowledge is lost, leading to decreased productivity. Employee turnover can also lower morale and prompt others to leave.
Your employees are not machines grinding for the weekly paycheck. They weigh many concerns: work-life balance, a chance to grow, good managers, communication and talented colleagues. Competing on salary alone will not succeed.
Employee Retention Strategies
Employee retention means engaging your employees on many fronts with the goal of enhancing job satisfaction and improving the overall work environment. These 10 employee retention strategies are a great way to keep your retention rate high and turnover low.
- Salary and Benefits
Money is perhaps the most important factor in keeping employees. Expect to pay a competitive salary for top talent. Benefits — bonuses, paid vacation, health insurance, retirement plans — are also required. You might want to go a step further by offering additional benefits such as a low-premium high-deductible health insurance plan, pet insurance, fitness club subsidy or student debt repayment program.
- Hire Selectively
Employee retention starts with hiring the right people. The character of a new hire is just as important as skills or experience. Hiring the right people can be a top perk for the rest of your team. They get to work with other talented, driven, engaged people.
- Onboard Well
When new hires come to work the first day, a robust onboarding process should greet them to make them feel part of the team. New staff members should learn the details of the job as well as company culture. The onboarding process should be continual with ongoing discussions, opportunities to ask questions and information on how they can contribute and thrive.
- Leaders, Not Managers
To get the most from your employees, leaders matter. A leader is not merely a boss or supervisor. A leader inspires people to go a step beyond. Leaders communicate the organization’s strategy, adapt to new challenges, strive for high quality and believe in the importance of people. To turn managers into leaders teach your managers “soft skills” such as motivation, crisis management and conflict management.
All workers want the chance to grow professionally. Smart companies help their employees by investing in professional development and finding opportunities for growth. Pay for employees to attend industry events or enroll in continuing education. An assigned mentor, which should not be a supervisor, can offer career guidance or advice for a difficult situation.
Open lines of communication are essential for employee retention. Workers should know they can come forward with ideas, questions or concerns. Schedule regular meetings with individual staff members. These meetings should encourage open and honest conversations and occur several times a year.
Employee retention thrives in an atmosphere of collaboration. Working with other skilled and motivated people is energizing. When everyone knows the team objectives and roles, everyone can contribute ideas and solutions.
- Work-Life Balance
Today’s employees expect to have a life outside work. Encourage employees to take vacations. Offer flexible work schedules or telecommuting to help people juggle the demands of home and work.
- Employee Engagement
An engaged employee is a retained employee. Your job as an employer is to understand what motivates your people and what makes them care about what they do. High levels of employee engagement make for employees who want to stay.
- You Are Your Brand
Social activism and awareness animate today’s upcoming employees. Who they work for matters as much as what they do. Make your business known as a force for positive change by giving to charity, supporting educational issues or supporting local non-profits.
Do you have any stories about employee retention successes? Share them in the comments below.
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