According to research by Oxford Economics and Unum, the average cost of turnover per employee is £30,614. This can be even higher for more senior salaries and dependant on the situation can run into costs of up to £200,000. That’s a lot of money, especially if you’re a small business or a new start-up.
There are 3 things you need to do to reduce employee turnover and increase your retention. These 3 things won’t be easy, but in the long-term it will be hugely beneficial.
1) Gain Feedback From Employees
Getting feedback from your employees can be difficult, both to gather and also to hear if there’s anything negative raised, but it is vitally important that you are fully aware of the feelings of your employees. The easiest way to gauge employee happiness is simple: LISTEN. Listen, just in general, to concerns, issues, ideas and you’ll have a better understanding of what motivates and demotivates your staff.
To understand how people feel about your workplace, the easiest way to gain insight is with regular employee surveys. This is a great way to give your employees an anonymous platform to share their thoughts and feedback. You can even use a scale or star rating to make answering more straightforward. Always add a commentary section and invite suggestions.
Your employees are one of your most important resources so make sure you utilise their ideas. Review the survey results and look for any patterns or common issues that need addressing.
One to one
You might meet up with employees on a regular basis to check on projects and workloads, but how often do you ask about their well-being? One to one catch ups are a good opportunity for employees to air any issues in a private setting and also discuss any support they may need. Once you’ve covered business topics ask a question like “Is there anything else you’d like to discuss?” or “How are you finding things in general?”. These are both vague enough that they allow employees a clear avenue to get any issues off their chest.
Offering an ‘exit interview’ should be a standard part of your HR processes, but conducting them should in no way be mandatory. They should not be conducted by an employee’s manager but by an unbiased, independent interviewer. This could be a colleague or perhaps a manager from a separate department.
It’s crucial you use a neutral party to conduct the interview so the employee leaving can be completely honest about their experience of working at your company. Questions don’t have to be complex but again this is an opportunity to discuss why an employee is leaving and if there were any specific causes or to hear suggestions to improve work culture.
2) Optimise Your Hiring Process
To ensure you retain the right talent, you need to start with hiring the right talent. This means reviewing and optimising your hiring process to support business goals. Your business strategies should include a recruitment plan for employee growth, including highlighting specific departments for development, budgets, diversity goals and market research.
Shorten and review
Speed is of the essence when hiring. According to Hinterview, up to 75% of candidates that abandon the recruitment journey do so because of its length. Not only does a lengthy interview process put off candidates, it also gives other businesses with shorter processes the opportunity to swoop in with an employment offer. To reduce the process, we recommend utilising video profiles to replace initial face to face interviews.
You’ll also need to get feedback from candidates, continually throughout the process. Communication is key and if you use a specialist recruiter, they can speak with candidates to find out how they felt the interview process went and raise any concerns.
It’s important to think about their experience when coming for an interview. Did they receive a friendly greeting? Is the office clean and inviting? Your interviewer is key because they will need to be enthusiastic and be able communicate your business goals, values and benefits. Interviews work both ways, so this is your chance to impress and entice the top talent.
Ensure company fit
One way to reduce turnover is to ensure the right ‘company fit’ when hiring. This can be difficult to quantify but you want to ensure candidates not only have the right skills for the job but also the personality and behaviours to get on well with the rest of your team. Candidates should also ideally buy into your business goals, share your company mission and also enjoy your office environment.
A great way to ensure a good company fit is to use multi-channel advertising to attract a diverse group of candidates and follow this up with video profiles and then candidate assessments. Shameless plug here, but this is how we support our clients and also how we conduct our own hiring.
Video profiles allow you to see and hear a candidate talking about their skills and experience. You get a real feel for their personality, interests and communication styles before inviting them for an in-depth interview. Once you’ve got a shortlist, candidate assessments can offer you real insight into their leadership styles, workplace behaviours and motivators. This will help you determine whether or not they will prosper within a certain team or under a specific type of management style.
Your offer package
You’ve optimised your hiring process and found the right fit for your team, so now it’s time to make sure your offer package is competitive. Offers need to be made quickly, as our own research shows that candidate interest in a role starts to dip 3 days after interview.
For a competitive offer package you need to have done your homework. The salary should have been benchmarked against other similar roles for your industry and needs to be competitive for the work they’ll be expected to undertake. Highlight all your benefits, whether that is flexible working or professional development or rewards.
Refer to your interview notes and look at any professional goals or interests the candidate shared. Perhaps add to your package a commitment to sending the candidate on training course they are interested in or other personalised elements.
3) Improve your company culture
There are so many articles out there about the importance of company culture and it’s true, a good company culture can be the difference between success and failure when retaining staff.
Culture for the individual
Professional development is one of the top 3 factors for candidates when looking for, or accepting a new role. The ability to learn and grow will not only benefit your employee but your business as well. It’s crucial to have a training development program in place for the wider business but you should also identify development opportunities for each individual you employ. Managers should discuss and create personalised training plan with every employee.
As well as a development plan, employees should also have a clear understanding of their promotion opportunities within the business. You should already have promotion policies in place for the wider business but look at ways that employees could progress and put a clear structure in place.
Be transparent when it comes to salary discussions. Salary reviews should be conducted regularly and increases should be made in line with economic changes, market standards and employee performance. Having a competitive salary standard in place that is reviewed regularly gives employees reassurance that their financial needs are being met and helps to build loyalty.
Business wide culture
To achieve a good company culture, the first element you need to review is work/life balance. This is vital to supporting your employees. The cumulative effect of new technologies and increased working hours can prove damaging to many professionals physical, emotional and mental well-being. We all now have an understanding of how detrimental stress can be, so ensure your employees are happy and productive with manageable hours and tasks. Your employees are individuals and will have individual needs, so team leads need to be aware of any personal issues and you should have a support structure in place to address any problems.
Do not underestimate the importance of a good working environment. Well-being studies show that natural light, music and plants rank highly for employee importance in an office environment. Happy employees are productive employees so if your office is looking a bit gloomy then it’s time for a makeover!
Go beyond benefits. Yes, it’s good to have relevant benefits such as pensions, but you need to go further. Look at ways you can recognise and reward you employees, such as nomination schemes, quarterly awards or even small incentives such as Perkbox.
You’re never going to make every employee completely happy, or hold on to every member of staff, but if you notice a pattern of employee turnover then you need to address it, sooner rather than later. By creating an optimised hiring process, improving your culture and by listening to your employees you’ll reduce your turnover and create a company atmosphere of productivity and positivity.
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