With the economy accelerating and the job market heating up, employee retention becomes difficult. This problem increases for your top performing talents, especially in the middle market companies. Losing your best people not only damages your productivity, but it also disrupts current and potential leadership, therefore, reducing company morale. If it could not get any worse, losing these people also helps your competitors. Having to match a competitor’s job offer in order to retain your top performers is NOT a retention strategy — it only incentivizes employees to seek outside job offers and ask you to match them.
While you may think a formal retention strategy is a big investment (and you’re right), it will actually save you money in the long run while also helping you recruit top talent and increasing your middle market company’s overall productivity and morale. Here are 7 pointers how SuccessFactors can help you tackle your retention issues:
1. Attract and hire the right people. Retainable employees show a clear commitment to contribute their skills and share best efforts to your organization for the long term. First, seek people who are intrinsically motivated and interested in developing their skills and careers. Those only seeking for money and power are classic ‘turnover risks’. Second, when you hire, clearly establish expectations so that disappointments on both sides can be avoided. Lastly, it’s also important to understand your company’s culture and how potential hires fit into it.
2. Have a successful system for evaluating performance. Both the company and the employee benefit from knowing exactly where they stand in relation to each other’s expectations. By monitoring and sharing results, it becomes clear which employees are meeting (or not meeting) performance expectations. Evaluation gives middle market companies the chance to recognize and reward excellence, a key aspect of employee retention. Employees expect feedback and will leave if they’re not getting enough. Read our previous article about Performance Reviews to learn more.
3. Get insight on overall employee satisfaction and levels of retention and turnover. This allows you and your employees to know where problems are so you can solve them. Having an employee satisfaction survey, and then acting upon it, can decrease turnover. Questions you’ll need to include: Are your people happy with compensation and benefits? With how they are managed? With the challenges the company offers them? With the training opportunities? Collecting this information will help support your ongoing retention efforts. Employee central gives you an insight in the workforce and where the turnover is happening.
4. Train your managers and supervisors. When your managers and supervisors develop their communication skills, there will be a great understanding of expectations between employees and the manager. Evaluation of performance is an area that is influenced by that. It begins with clear, measurable expectations that both the manager and employee agree to and track. Giving managers better skills in offering important (sometimes sensitive) feedback is crucial. Employees generally don’t quit on the company, they quit on their managers. Having managers who communicate feedback well and behave professionally is perhaps your best retention strategy. Tie skills to retention and manager job profiles. Make sure the right training for those skills is available and taken into goals and performance reviews.
5. Create opportunities for employees to develop their career. This will allow your employees to have a better long-term vision of their evolving role inside the company. By creating a career path together, it shows commitment to developing talent. This will actually benefit both the company and the employee. SuccessFactors succession and development solution can help and support with the succession planning tools which provides:
• Career Development Plan: The development plan can include an integration with the Learning Management System (LMS), which gives employees that opportunity to search for learning content that can help them work on specific competencies or skills and close the knowledge gap they identified.
• Career Worksheet: Employees are able to identify their career interests, view career paths and job roles, and check their own competency readiness levels for those potential next roles. Having an understanding of the development effort required to move into a desired future role empowers them to continue to further their career within the organization through development.
• Once the competency gaps are identified, they can directly link those competencies to development goals:
Succession Planning: These are tools that are used more by managers and HR to improve their hiring practices from within (rather than external candidates) and to identify retention risks in advance so they can plan accordingly. I don’t think it necessarily applies here.
6. Recognize talent and celebrate employee success. Many companies only reward the ones that are high achievers, but it’s more valuable to encourage anyone who goes above and beyond their performances. By recognizing smaller achievement, a good example will be set. You will create a culture where everyone likes to set a good example. The problem for most companies are lying in the fact, they don’t see these small success stories or don’t have the tools to make them visible. With every manager rewarding in its own way, there will never be a cohesive company culture with regards to rewarding and retention that is employee driven. By using SuccessFactors Continuous Performance Management it can be possible to capture the small changes in your employees’ career path at any time and review their growth and skills.
7. Customize benefits and work expectations on an individual level. Normally this process will take a lot of time and effort. Every employee is unique and so are their needs and expectations. By creating the opportunity to listen, it might result in changing offering the same benefits package and working conditions to inevitably create dissatisfaction. This is a turnover risk. While it may be inconvenient to offer more flexible working hours or a customizable menu of benefits, such practices boost employee satisfaction and loyalty. Benefitfocus has a marketplace which allows employees to choose the right benefits package with self-service.
The takeaway: If you don’t want your best people walking out the door, you’ll need to build a proactive retention strategy that meets their individual needs for career development, recognition, and work-life balance.
Does your company have a retention strategy in place? Now is the right time to think about getting one or improving your existing one. Exaserv is specialized at helping the mid-market to enhance their solutions and to better help you.
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