It’s no surprise to any employer that turn-over is expensive. Industry estimates vary replacement costs from 30-50 percent of an entry-level worker’s annual pay up to 400 percent of a highly specialized employee’s salary. (ERE Media, 2015 – https://www.eremedia.com/tlnt/what-was-leadership-thinking-the-shockingly-high-cost-of-employee-turnover/ ). That’s money that no business wants to lose.
There is good news though. Being proactive instead of reactive makes a difference. There are strategies any company can employ to keep their workers happy and loyal.
Reward Your Employees
“Show me the money!” may be the first phrase that comes to mind, but recent research suggests incentive pay plans are not always the best motivator. (Fortune, 2015 – http://fortune.com/2016/02/24/salary-bonuses-merit-raises-effectiveness/) For bosses operating on a tight budget, this offers the opportunity for both creativity and expressions of genuine gratitude. Handwritten thank-you notes, “Day Off Passes” and smaller gifts such as snacks, movie tickets or magazine subscriptions also may serve as effective recognition.
Encourage Social Interaction
Not everyone in a company will get along, nor should employees be enmeshed in each other’s lives. However, socialization on a professional level allows workers to communicate better, trust each other more and create a high-performance culture. Who wouldn’t want to be part of that team? Usually, the best activities are those that relate directly to the company such as coffee breaks, birthday celebrations, business lunches and corporate sponsored events.
Employees who fear unexpected job loss, work feuds or poor performance reviews will start to look for other jobs. Management theorist Simon Sinek suggests effective bosses help their workers feel secure by creating a Circle of Safety. There is an emphasis on what is best for “We” the group, not “Me” the individual. There are even examples of progressive corporations where everyone, including management, takes a pay cut during tough economic times to avoid individual layoffs.
Keep Open Lines of Communication
Sometimes it is the small things that matter. An unhappy employee may have a problem that is relatively easy to solve if management is understanding and easily accessible for conversation and feedback. Open dialogue is a good way to identify workers who cannot be appeased as well. In these cases, a transition may be in the best interest of everyone involved.
Every company will inevitably lose top employees at one point or another. However, respect and empathy are key ingredients for retention. In the end, many people leave their jobs not because of money, but because they do not like the way they are being treated.
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