When you run a business, you have a whole lot to focus on. You’re going to be developing, creating and marketing products or services to the consumer market and the pressure is going to be on to get all of these things right. You also need to make sure the basic tasks are being completed to keep your company afloat, such as order fulfilment, customer support and more. It’s not all too surprising that your staff may fall to be the back of your mind and that you may begin to see them as a means to an end of generating profit. But this isn’t the way to go about things. You need to remember that your staff are people. They are individuals who have their own wants and needs and, if you’re not careful, they will leave to work somewhere else. They’re bringing a lot to the table and you’re going to have to provide a lot in return to make sure that you retain them and keep them on board. Let’s take a moment to focus on staff retention. Here’s some information that will familiarise you with the subject, its importance and how to experience success in this area!
What Is Staff Retention?
Let’s start by fully understanding what staff retention is and why it is so important. Also known as “employee retention”, staff retention is your company’s ability to keep staff on board and prevent employees from leaving. When you come up with a staff retention strategy or method, you will be making a concentrated effort to retain your existing staff, rather than staff regularly resigning and you having to go through the recruitment, onboarding and training processes time and time again.
Why Is Staff Retention So Important?
Staff retention really is important for a number of purposes, so let’s look further into them to understand their significance.
- Sustained productivity levels – staff tend to get on a roll when they’re working for your company. Staff who have been on board for a long time know how your organisation works, are well integrated with others they need to collaborate with and will have a better understanding of your business’ vision and expectations. They are much likely to perform at a better standard than those who are still finding their footing in the workplace and who are likely to go through a few periods of conflict before settling into your business and how it works. Long term employees are simply more productive as they are settled. Productivity also drops when staff leave, as projects end up on the back burner until a new recruit can step in and pick them back up.
- Reduced company spending – recruitment isn’t a cheap process. Whether you do this in house or use a third party recruitment company, you’ll find that coming up with job descriptions, reading through applications, whittling down options, interviewing and repeat until you find the right person to fill the seat is time consuming and expensive. Then, even when you find someone who is good for the role, they’re not going to start generating money for your company straight away. Instead, you’re going to have to spend more time and money training them up and inducting them. This is particularly poignant when you find that the typical time it takes to find a new recruit and onboard them is roughly 94 days. Keeping staff on board really is the wise financial move to make.
- Company image and reputation – people notice when the same job at the same company keeps appearing on jobs boards. If people continually leave roles in your company and you’re having to recruit time and time again, you will find that less people are likely to apply for the position. They’ll see poor staff retention as a red flag that implies the company isn’t good to work for and that all of these people are leaving for a reason. You want the best staff on board and, in order to achieve this, you’re going to have to prove that you’re a good employer who people do want to stay with. You will also have to face the dreaded question of “why did the last individual leave the role” a lot less often.
Finding Out Your Employee Retention Rate
Of course, you probably have a rough idea of whether your employee retention rate is something to worry about or not. It’s hard to ignore multiple staff walking out of your business, one after the other. But it’s still worth working out your employee retention rate on a regular basis so that you can track it over time. This can give you early insight into worrying trends or patterns, allowing you to combat the problem at its source, rather than waiting for things to spiral into a staffing crisis within your business. Start out by deciding which time period you want to use to measure retention for. It’s good to step into the past and then maintain these calculations over time. This will provide you with ongoing data to make informed decision. You may want to measure employee retention rate year on year or month by month. Monthly tends to be the best and most popular approach, as this gives more niche insight into trends – for example, it could highlight that staff tend to leave around a specific time of year that you need to manage more effectively in the company. Once you’ve chosen your time period, you will need to collect data – the number of employees employed on the first day of the chosen time period and the number of employees who stayed employed through the length of this time period. For example, the number of employees you had on 1st Jan 2022 and the number of employee you had on 31st Jan 2022. Don’t count new hires who weren’t on board at the start of the time period.
You can then calculate your staff retention rate for this period by dividing the number of employees that stayed with your company through the entire time period by the number of employees you started with on the first day. Then, multiply this number by 100. Tracking this data over time will give toy a clear graph showing peaks and troughs in staff retention.
Keeping Your Employees on Board
Of course, there are countless things that you can do as a business owner that will help you to keep employees on board. The first step to take is to create a budget for what you can afford to spend on employee retention. This will ensure that your business is still profitable while you invest in staff happiness and satisfaction. Once you know what you can spend, here are some ideas that could prove successful!
Transport Assistance
Providing company cars, fleet vehicles, fuel cards, mileage reimbursement, parking reimbursement and other transport related perks and cost coverage can really keep your team happy. Transport is a big cost in many people’s personal lives, so many will be reluctant to spend more than necessary on this area to get to and from work.
Healthcare
Healthcare is a big perk that many staff seek out when starting a job or seeking out a new job. Find good packages and policies that cover your staff and their immediate family properly, rather than cutting corners and choosing options that don’t actually provide much.
Pension Contributions
Your staff will inevitably worry about their future. Settle doubts and keep them on board by offering good pension contributions. This way, they will feel that they’re working towards their future and will be less likely to jump ship.
Bonuses
Staff like to be rewarded for their hard work. Offering some sort of bonus scheme can see them earn more than their regular income and can put a smile on their face thanks to the feel good endorphins we get when we are recognised, and rewarded.
Respect
All staff in your business need to be treated with respect at all times. This is a basic and should go without saying, but when tensions rise, pressure is on and people start to feel emotionally overwhelmed, some things can be said that leave people feeling dejected and unappreciated. Instead, make sure to keep things level and to ensure that everyone is spoken to and treated with respect at all times.
Understanding
Sometimes, you need to be lenient with staff. People are human. People have lives and responsibilities outside of the workplace. Allow people doctors appointments, dental check ups, the occasional work from home day because they can’t find childcare. There’s no point in punishing people for being human and making them use their annual leave to cover issues like this.
Sure, it can feel difficult creating a workplace environment that always keeps your staff as happy as possible. But it is possible. You just need to make sure that you’re putting the effort in. Hopefully, some of the information above has really highlighted just how important staff retention is and what you need to do to get this to a good place in your company!
