The aftermath of 2008 economic downturn saw employee turnover plummet as most employees decided to hunker down in their jobs.
Turnover went from 35.7 percent in 2007 to 23.6 percent in 2009, but now it’s gradually inching back to its earlier, pre-recession level. The U.S. Department of Labor reports that it reached 26.5 percent in 2011, and this year, it’s projected to cross the 30 percent mark again.
As Baby Boomers pass the baton to younger shoulders, mediocrity dies a slow death, and talent poaching becomes a norm, giving rise to the harsh truth of employee turnover.
Most employee retaining strategies have always revolved around things like this: Fatter Paychecks, Better Benefits, Rewards and Recognition, Flexible Work timings, Cushy work environment, Training and Development sessions, Recreational activities, Career Growth, Healthy Relationship between Co-workers and Senior Management, Special benefits (for star employees), etc.
Which is nearly everything! Even then the erosion of valued employees seems unstoppable.
Reasons that strategies fail
Why do the best of employee strategies fail?
Sometimes it’s a combination of many things, sometimes it’s that one thing most dear to an employe that the organization fails to get.
1. There’s no end to outlandish salaries and material benefits – They can never judge people for how long they’d stay. Who knows it might work only till the next bidder poaches them.
2. Square peg in a round hole-type cases — Sometimes, employees just don’t fit the organization. It might have to do with their immediate manager/supervisor, because as they say, employees don’t leave organizations — they leave managers.
3. Not identifying with the company’s vision, mission, or values — Employees can feel disillusioned if they fail to comprehend these things. It must be clearly communicated how they contribute to the company’s plans.
4. Losing faith in top leadership — If the senior staff doesn’t lead its employees by example, they stand to lose their belief in them. Employees may left feeling they’re in unreliable hands.
5. Confusing, ever-changing policies — Not being true to their word when it comes to making policies can be a dangerous recipe, capable of hurting the organization’s credibility.
6. Workplace politics, blame games, arguments, censuring publicly — All of these can go a long way in damaging relations between employees and managers or the senior staff.
There are many other inexplicable reasons, as seen in thousands of exit interviews, that cause employees to leave. But, there are some companies who seem to rule the roost when it comes to employee retention”
Google often ends up in the Top 5 on Fortune‘s annual Best Companies to Work For list. It enjoys a 2.7 percent employee turnover rate, and is one of the most exciting workplaces on Earth.
With a long list of freebies – including all meals, health and dental, haircuts, on site physicians, dry cleaning and nap pods — it’s often said to be more like an adult playground than a place to work.
An employee turnover rate of less than 3 percent has widely contributed to Zappos phenomenal success. The online shoe retailer took a giant leap between 1999 (its inception) to 2009, going from $1.6 million to $1.1 billion in sales.
This amazing financial feat is often credited to its pulsating work culture. During 2009, Zappos made it to No. 23 on Fortune’s 100 Best Places to Work For list.
SAS, the largest independent vendor in the business intelligence software market, has an average turnover of around 3.7 percent turnover and has never gone over 5 percent in more than two decades.
Among some of its unique policies are things like unlimited sick leave, on-site day care, free family health care, a 35-hour work week, free food and refreshments, and more. It placed No. 2 on the 2013 Best Companies to Work For list.
Your company may not make the annual Fortune list, but there are things you can do to improve your employee retention. Setting up your strategy relies on a variety of factors from the size of your firm to the nature of your work and everything in between.
But, a few constants do cut across organizations of all sizes in all industries.
1. A sense of connection
Pay them what they deserve, and see that they share the same sense of connection with your customers/ clients as you do. Allow them full freedom. Creating a fun environment, even sports can help. After all, Work and Play are similar activities under different conditions.
Let them feel empowered and respected, value their advice. Greet them well. Never underestimate their worth. Foster an environment of no hierarchies. Let them develop trust in you.
2. Give them a career, not a job
Ask yourself why do you want to hire them?
Is it for your short-term gain? What does the employee have in store (apart from the perks) in the long-term? How about paying a thought to an employee’s growth in 5 years?
Remember, even a speck of doubt in your employee’s mind during hiring can snowball into a big cause for leaving later. Have a plan. Otherwise you’ll always be hiring and dropping people.
3. Training is important
If you’re happy after hiring an employee, great. The next thing is to train them.
Acquaint them with your firm’s needs. Invest in their development. Right training will bring you and them on the same page. Dispel all their doubts before they hit the work floor.
Remember: Your growth is entwined with your employees’ growth.
4. Perk-up your perks
All great companies do that. So what if you don’t oper