Retaining Your Most Valuable Employees
Employee retention refers to the various policies and practices which organizations adopt to try to get employees to stick with the organization for a long period of time. Organizations invest resources to orient new employees to increase their corporate capacity and bring them at par with existing employees.
Unfortunately, the reality for many organizations is an accelerating rate of turnover of their most valuable employees that clearly impacts negatively on organizational performance.
Why do Employees Leave?
This age old question has been asked by many managers. Most employees leave an organization out of frustration or constant friction with their supervisors or colleagues, low salary or lack of growth, to mention a few.
Management must ensure its employees are satisfied with their roles and responsibilities and the job is offering them new challenges and learning opportunities especially key employees who are known to be effective contributors.
Few companies, if any, have an accurate understanding of why their employees stay or the reason they really choose to depart.
1. The reasons employees stay are not the same as why they leave
Traditional exit interviews rarely capture the true causes of turnover. In particular, they usually fail to differentiate between factors that make the new job attractive to the departing employee and the reasons why the employee was prompted to consider leaving his or her current job in the first place.
Although “better compensation” is often cited as a major reason for leaving, research suggests that departing employees were not originally dissatisfied with their pay. Rather, other reasons may have prompted them to consider leaving their current job, such as the absence of professional development opportunities. It appears they often do not report these negative reasons associated with their old job (possibly for fear of retribution), but instead report what is attractive in the new job.
Experience suggests that attractive candidates routinely receive job offers from rival firms. Few, if any are positively responded to. So, what causes an employee to act on a job offer at a particular point in time? Typically, something has deteriorated in the work situation causing them to take a current job offer more seriously.
2. Managers play an important, but often unrecognized role in turnover
Most managers publicly lament the loss of talented contributors. However, most are also more likely to blame a variety of external or organizational factors than to take any personal responsibility for the situation. They typically do not acknowledge any factors within their control that might have contributed to an employee’s departure.
In reality, it appears that a large number of the factors contributing to employee retention are in fact within the manager’s sphere of influence. Consequently, the organization must provide managers with a greater awareness of those factors, as well as the tools to help them meet their personal accountability in retaining top talent.
3. Prevention is Better than Cure
Experience suggests that the average manager only thinks about retention when he or she receives a resignation from a key employee. The first response is to try and talk departing employees out of leaving, and to convince them that they are making a mistake.
Unfortunately, the vast majority of such employees resist such efforts to persuade them to stay. In the event that a manager successfully persuades an employee to remain, he or she often leaves within six to nine month’s anyway (salary inequities that are remedied, seem to be the only exception).
The solution appears to lie in tying retention to critical business activities so that managers do not think about retention after the fact, when it is too late, but rather view it as integral to business success and survival. Treating retention as an on-going priority enables the manager to focus on pro-active measures to sustain long-term employee commitments, rather than on reactive attempts to reverse surprise resignations.
Dealing with Retention Problems and Creating a Defensive Strategy
Clearly, it is important to respond appropriately as soon as the first symptoms of a retention problem begin to manifest. But is it also possible to pro-actively develop a defensive strategy that both nips potential retention problems in the bud and reduces the likelihood of their occurring in the first place? We believe it is. In the next module, we examine how to implement a more strategic approach to analyzing retention issues and designing effective retention solutions.
Written by Genevieve Craig