Employee turnover costs US companies $160 billion a year.
That’s a sobering statistic for any organization, but the stakes can be even higher in certain industries. For example, failure to retain key talent can be a potentially life-threatening situation for a health care company.
As we kick off 2019, employers have to consider how they can ensure their employees will want to spend another 12 months at the company. Here are a few options:
1. Onboard Effectively
Your onboarding strategy is absolutely critical to retention. Give your employees the kind of training they crave, which should include information about the company culture and all the resources you can offer as an employer. This will lay the foundation for a long, successful tenure.
City Electric Supply (CES) discovered the benefit of thorough onboarding when it asked its employees, “If you could invest in one part of the business, what would it be?” Employees responded emphatically that they needed more training. In response, CES developed a new-hire orientation that brought all new employees to the company headquarters within the first 90 days of their employment for comprehensive training. Through these efforts, CES reduced new hire turnover by 50 percent.
2. Provide a Comprehensive Review Process
So you’ve found the best talent, you’ve trained them, you’ve integrated them into the company, and they’ve been working for you for nearly a year. It’s annual review time.
While many leaders and managers assume compensation will be an employee’s key concern at their first review, what employees truly want is feedback on their performance and a discussion about professional development.
Develop a replicable process for employee reviews that allows for thoughtful conversation and recognizes the accomplishments and challenges each employee has experienced. Follow the conversation with an action plan that illustrates a path forward. Conclude the review with a commitment to the employee’s growth and a recognition of any grievances they may have — including those related to compensation.
Better yet, implement a platform that enables continuous feedback throughout the year, in addition to annual reviews. In our on-demand world, people are accustomed to getting feedback from their customers, friends, and the general public every minute of every day. Many organizations have started to recognize that the annual performance review is not enough in this environment. Top talent doesn’t want to wait 12 months for feedback on their performance — they want to hear it continuously so they can make adjustments on the spot. In turn, they also want their own opportunities to share their opinions on what the organization could do better.
3. Offer the Opportunity to Give Back
It can be hard to find time to give back among the many demands our work and family lives place on us. However, at the end of the day, the time we devote to causes bigger than ourselves can make a huge difference in how rewarding we find our daily activities.
In addition, committing to altruism as a group is a powerful team-building tool. A recent study reports that 75 percent of employees who regularly volunteer through work feel better about their employers than those who do not. Giving back through work was also found to improve employee mood, lower stress levels, and increase employee self-esteem.
4. Share the Wealth
Quality talent isn’t cheap, and it is worth investing in compensation to help fight turnover and improve your company’s bottom line.
Johns Hopkins University fellow Lizz Pellet cites two primary reasons why top performers explore new employment opportunities: compensation and leadership.
With regard to compensation, Pellet points out that money won’t necessarily buy loyalty, but it can definitely become a factor when other challenges are present.
“Pay and benefits are a driver to many individuals, and to some people the extrinsic benefits of the organization can outweigh the intrinsic benefits,” Pellet explains. “Employees can withstand and overlook things when they feel highly compensated, but when they feel they are underpaid … there is a lot less toleration.”
Profit-sharing and employee stock programs are also gaining popularity as agile compensation measures for small businesses, and may help level the playing field for companies that struggle to pay industry-standard levels of compensation.
5. Encourage a Culture of Purpose
There is nothing like burnout to encourage employees to look elsewhere for employment. One way to avoid burnout is to cultivate a shared sense of purpose within the organization.
According to Sara Roberts, author of Nimble, Focused, Feisty, the key to success in the current era of volatility, uncertainty, complexity, and ambiguity hinges on a business’s ability to create a purpose-driven culture. She writes in a white paper:
“Purpose is a fundamental need for human beings, as individuals and in groups, in our lives and in our work. A productive, effective, and authentic way to operationalize purpose in an organization is to figure out how to support and drive value for the customer in line with that purpose. When key questions are asked, decisions made, and actions taken accordingly, the organization can be said to be leading with purpose. That clarity not only connects the business to the customer in a deeper way, but it [also] drives innovation in service of customer value, leads to more sustainable growth and profitability, infuses authenticity into marketing and brand, brings employees and stakeholders together, and helps the world become a better place.”
As Waggl CEO Michael Papay, said at the company’s leadership summit earlier this year, “The corporate war with talent is over, and talent has won. Talent has the skills that are portable and can be moved to other organizations, and the desire to work only in a company and position that offers an exceptional cultural fit.”
It is your organization’s job to give employees a reason to stick with you rather than go in search of greener pastures.
A version of this article originally appeared on the Waggl blog.
Julia Winn is senior creative producer and content strategist at Waggl, the most human way for organizations to crowdsource feedback.