Employees are considered as the most valuable assets for an organization as they don’t only represent an organization but also create its competitive advantage. Retention of employees is a fundamental strategy that requires proper planning and appropriate policies.
However, in the first place, it’s essential to understand the reason behind the high turnover rate.
Why Employees Leave Organization? There are a few top reasons:
• Pay Scale: Decent pay rate is the main motivating factor, so employees generally consider leaving an organization if they get comparatively higher pay somewhere else or if they are not satisfied with their current pay.
• Lack of Motivation: Motivation is a psychological factor that encourages employees to work for the achievement of desired goals. Employees should stay motivated at work, whether monetarily or non-monetarily.
• Lack of Proper Managerial skills: Unfortunately, managers who do not have proper managerial skills are not able to retain their best employees. It is necessary for a manager to deal with the issues that arise in a team and provide an appropriate solution.
• Fewer Growth Opportunities: Employees switch over to other companies when they don’t have any room for professional development
It is a very difficult task to retain employees but also very important because there are many organizations that are constantly looking for knowledgeable or highly skilled workers. Replacement of an employee usually costs 3 times the salary of an individual.
Why Retention is Important?
• Cost of Turnover: The cost of turnover means tangible or intangible costs associated with the replacement of employees. The cost of turnover also includes the cost of hiring and training new employees as well as intangible costs caused by the loss of productivity of knowledgeable employees.
• Loss of Organizational Knowledge: Employees take with them knowledge about the company’s project clients, training offered to them. An organization spends the chunk of its budget on the training of employees by expecting a good return in future.
• Skilled Employees: Retention of employees ensures skilled and knowledgeable employees remain in the company and help in the development of strong staff, which benefits an organization in the long run.
• Impact on Client service: Customers need reliable and consistent service. Long-term employees develop harmonic relationships with customers. That’s why the retention of employees has good impact on clients as well. It is very important for an organization to retain its employees. In order to do that, a organization should frame proper policies and strategies.
Strategies to Retain Employees
• Offer Competitive Packages: An organization can retain its employees by providing them competitive packages. Companies nowadays are looking for talented employees and a good pay scale can motivate them to remain in company.
• Better Communication: Cоmmunication between the vertical and horizontal level is really crucial. It is very important to address any issues that may arise in a team and to provide them with the proper solution.
• Employees’ Participation in Decision making: Employee’s participation in the company’s important decisions not only increases their morale but also they can provide some very good suggestions that could be helpful for the company.
• Provide Opportunity for Growth and Development: An Organization should offer training and development programs to employees so that they can grow and develop and feel satisfied in terms of growth.
• Feedback: Regular surveys should be conducted to know employees’ feedback regarding managers, team leaderѕ, supervisors or on other issues. those surveys can also help to know their satisfaction level.
• Bonus: Timely bonus like performance-based bonus, loyalty bonus are also helpful in increasing employee’s morale and their retentiоn in the organization.
• Positive Work Environment: Harmony in a relationship and positive work environment lead to employee satisfaction, which is even important than money.
• Trust Employee’s Abilities: Truѕting employees’ abilities can boost their confidence and motivation and help the organization to retain them for a longer period of time.