Employee retention is a critical issue for any business, and for many, finding effective methods to improve employee turnover rates can be challenging. It’s worth noting right off the bat that you can’t improve employee retention without investing in your retention strategy. However, the cost of hiring new employees and training them in their new roles far outweighs the cost of keeping your existing employees happy and thriving.
High employee turnover can also lead to a lack of knowledge that only comes with long-term employees. The longer your team have been working for your organisation, the more “on the job” experience they will have, and this experience is priceless.
To ensure you reduce your employee turnover rate, it’s essential that you form a well-rounded retention strategy made up of various moving parts.
Before we dive into our retention strategy tips, here’s a few basics to help you get started with developing your strategy.
What isย employee retention?
Typically, your organisation will measure this with an employee retention rate.
How do you calculateย employeeย retentionย rate?
It’s simple to calculate your organisation’s employee retention rate. We’ll walk you through it step by step.
- Determine a time period you want to use for this metric. Most organisations do this by quarter or year.
- Calculate the number of employees who have stayed with your organisation throughout this time period.
- Calculate the number of employees with you at the beginning of this time period.
- Divide the first number of employees by the second number, then multiply by 100.
Your employee retention rate formula should look like this:
(# of employees with you all year) / (# of employees with you at the beginning of the year) x 100
Why isย employee retentionย crucial for an organisation?
Retaining your existing employees is crucial for an organisation because regularly hiring new employees can be a time-intensive and costly exercise. Although sometimes this is necessary to recruit for new roles, you shouldn’t be regularly laying out these costs for existing roles where employees have left due to dissatisfaction with their role in your business.
By retaining as many existing employees as possible, you can reduce these costs and benefit from employees with years of industry experience from their time with your organisation. This experience is invaluable when it comes to more difficult projects and promoting company culture for your entire organisation.
Now that we’ve covered off why aiming to retain employees is crucial for your organisation, let’s dive into the strategies that will help improve turnover and retention rates within your team.
10 Ways To Improve Employee Retention
Here are ten ways you can improve employee retention that are immediately actionable and will make an impact in your organisation.
1. Offer ongoing training and development opportunities
Many employees leave due to a lack of career growth opportunities. By offering ongoing training and development opportunities within your organisation, you can help combat this and make your employees feel like you are investing in their future growth. This also has a huge benefit for your business because if you invest in your employee’s skills, you will benefit from this in how they perform in their roles.
At LCT, we offer a range of courses that can help your employees develop new skills and advance their careers, including banking and finance courses, management and leadership courses, and sales and marketing training.
2. Encourage open communication and feedback
Creating an open and transparent culture in your organisation can help to improve staff retention by giving employees a sense of security and trust. You can encourage employee engagement in this by regularly requesting employee feedback and creating channels for them to voice their concerns and ideas. When you introduce this, you may find this system works best anonymously, as employees can feel a little anxious about opening up at first!
3. Promote a healthy work-life balance
Your employees want to achieve a healthy work-life balance, but this is incredibly difficult if the organisation isn’t on board. It can also lead to feelings of resentment and burnout amongst your employees.
To promote a healthy work-life balance, consider offering flexible work arrangements, such as remote work options or flexible scheduling, to help employees feel valued and appreciated for the hard work they put in year-round.
4. Offer pay increases and benefits
This is the elephant in the room, but a lot of employees will leave their current roles to seek out a job that pays them more money. So all of your underpaid employees are likely looking for new opportunities.
In order to keep employees within your organisation, you may have to put your money where your mouth is from time to time.
In addition to offering more competitive salaries, consider offering a range of benefits that can help improve employee retention, such as gym memberships, early finishes and free snacks to boost employee morale.
5. Acknowledge top talent
The top performers in your organisation can sometimes go unnoticed, especially if they’ve been in their position for a while. Acknowledging and rewarding these top performers shows employees that their contributions are valued.
It’s worth noting you will need to use a powerful incentive for this to work best for your business rather than making this a token gesture. You could consider employee benefits like gym memberships, extra holiday days or paid activities to reward your top talent.
If you award promotions based on performance, this also shows that there is potential for career advancement within your organisation.
To help motivate team members who may not be performing as well, you can also implement a performance appraisal system that provides feedback on performance and identifies areas for improvement. But be sure that all employees are on this system, not just the ones who need a little boost!
6. Encourage collaboration and community
Collaborative environments can lead to greater employee job satisfaction and improved staff retention. A lot of employees value coming to the office so they can see their co-workers, which means collaborating on projects can help give them a boost. Nurturing these co-worker relationships can make all the difference to your employee retention rate!
You could also consider organising work-related social events to assist with team-building to help nurture colleague relationships that aren’t related to specific projects or tasks.
7. Nurture a positive company culture
A positive company culture can improve staff retention by creating a sense of belonging and connection. You could consider implementing initiatives that promote inclusivity, diversity, and respect, such as employee resource groups or mentorship programs. Alternatively, you may find the rewards system mentioned in point 5, and encouraging feedback from point 2, work well to tick this box too!
To summarise, improving employee retention is essential for most organisations. By implementing some (or all!) of these strategies, you can help improve retention at your organisation and create a positive employee experience. In turn, this will show employees that you value their dedication to your business.
At LCT, we offer a range of courses that can help support employee retention and career growth, including leadership development and human resources training. Above all else, we recommend that you prioritise your employeesโ professional development to help improve retention and drive long-term success for your business!