Employee Retention: 5 Ways Small Businesses Can Avoid Employee Turnover
If you are concerned about employee retention in your small business, you are not alone. You may be well aware of how frustrating and time-consuming it can be to find the right individual to complete specific tasks in your organization. You may have even gone through several employees before you found someone you are truly interested in retaining.
The unfortunate reality is that employees quit their jobs every day. While you may think the majority of them leave for higher paying jobs or better benefits, that’s not always the case. There are many factors that can lead to unhappiness in a current position.
The last thing you want to deal with is costly employee turnover. But what steps can you take to improve employee retention?
Why it’s important to think about employee retention
As a small business owner, you are faced with the incredible feat of convincing top talent to join your company rather than a larger company. Larger companies are typically known for having better compensation and benefits, so this can be a serious endeavor. Once you have found the right person to join your team, you want to encourage them to remain with your company and help you achieve specific business goals.
More than that, employee turnover can cost business owners time, productivity, money and frustration. You may not realize it, but one of the top reasons people quit their jobs is because of dissatisfaction with management. With this in mind, there are several steps you can take to improve employee retention in your workplace.
How to increase employee retention
Most employees will have some displeasure with management over the course of their employment. When you offer the right combination of benefits and salary, your employees may be more willing to stay with you through the rough patches. Consider how you can enhance your benefits package with favorable health and life insurance coverage. You can also review your retirement plan and consider increasing the employer contribution amount.
In some cases, it may benefit you to offer different benefits to specific employees. This may include offering enhanced benefits to those who are senior or may be harder to replace. While improving your benefits package is a great way to decrease turnover, a closer look at your management strategy may be in order as well.
1. Encourage communication and feedback
One key aspect of management that you may be able to improve upon is communication and feedback between team leaders and staff members. A smart idea is to schedule annual or semi-annual reviews with each employee. During these reviews, give honest, constructive feedback about the employee’s performance. Talk about the key skills or traits the individual has that you value so you express that their efforts are appreciated and vital to the organization. Offer constructive ways for improvement, as well.
In addition, ask your employees to share what areas of their jobs they are dissatisfied with and how your managers could improve. More than that, take their feedback to heart and make a concerted effort to make the improvements they recommend.
Annual reviews should not be the only time you communicate with your employees. You should create an environment where they feel comfortable approaching you with issues as needed. You can also schedule group meetings where the team as a whole makes recommendations for changes and improvements.
2. Engage with your employees
Employees are less likely to leave a job when they feel valued and important. Each employee should be well aware of the importance they play in the overall operation of your business. They should clearly see what happens if they are not there or not doing their job well. They should also be included in plans for the future of the business. This ensures everyone feels the continued importance of doing well in their position.
Engaging your employees can also be accomplished through internal training and promotions. While they want to feel as though they are part of the success of the company, they also often want to grow in their career. They should learn new skills regularly and their position should be adjusted as they gain skills and experience. Very few individuals want to continue doing the exact same job every day for years on end.
3. Be flexible
Another common reason individuals leave their job is because they feel management isn’t flexible. All of your employees have other responsibilities and commitments that require their time and attention. In an ideal situation, outside commitments would interfere only minimally with their ability to work during normal business hours. In reality, issues arise periodically, such as caring for children and sick relatives, scheduling repairs on their home and more.
Your company should adopt a flextime policy and allow for telecommuting when possible. Telecommuting saves employees the time and stress of having to commute back and forth to work each day and it can greatly increase morale and job satisfaction. In addition, it can reduce your overhead considerably, saving you money. When an employee feels as though management truly cares about their needs and interests, they may find greater contentment in their position.
4. Foster development
All employees in your organization should work regularly to improve their skills. This is a benefit to your organization and it also increases job satisfaction. Everyone from your receptionist to your upper management team can benefit from learning new skills and continuing their education outside the workplace.
You can provide training sessions or allow your employees to attend seminars and courses. You can also offer a tuition reimbursement program for those who want to pursue a degree that is relevant to their current position. Managers can also be used to provide one-on-one coaching so employees learn new skills directly from their leaders.
Hire an HR professional
Business owners often try to take on human resources tasks on their own. This may be acceptable if you only have a few employees. However, as your company grows, you may find it increasingly beneficial to hire an HR staff. By the time a company reaches 100 employees, an in-house HR team is definitely needed.
HR tasks may include managing employee benefits, performing annual employee reviews, assisting with grievances and complaints, adding perks to the workplace and more. These skilled individuals can recommend new programs and initiatives your company can benefit from but you may not be aware of.
Employee retention is critical for small businesses. While it is important to compensate your employees well with a great salary and benefits package, enhancing your management efforts also helps.
About the Author:
Jen McKenzie is a freelance writer from New York, NY. She is fascinated by all things having to do with words, business, education and cutting-edge. When Jennifer is not busy writing, she enjoys taking long walks and spending time with her two pets Brando & Marlon. You can reach Jennifer @jenmcknzie