Strategies For Retaining Staff

Retaining qualified employees is a challenge all companies face. Having the right staff directly impacts an organisation's ability to maximise productivity and achieve business goals.

The impact of staff leaving can have a detrimental effect on the business as a high turnover of staff can drain resources and undermine efficiencies. 

The theory remains that it costs a company three times the candidate's salary to replace them. This includes a loss in productivity - both in the role itself and by colleagues who are affected by staff leaving and creating morale issues. It also includes a loss in knowledge; and for the Manager, a loss in time spent in the core business as time is taken up with hiring (which can be very time consuming to find the right person) and training. Back filling a role in most cases is counter productive verses recruiting additional staff.

There are a number of reasons why employees leave an organisation and to a large extent it is this insight that will empower the employer to retain its staff. For an employer it is vital to know what motivates staff on an individual basis.

1. Better career development potential
   Where an employee feels they can not get the exposure and career expansion in their current position they will look elsewhere. Promoting from within is not always easy but many companies that succeed in keeping their turnover manageable make it a practice to promote current employees where possible before considering outsiders. The key here is grooming employees for promotion.
   
   
2. Salary
   This is one of the most important factors driving motivation. While it is true that it takes more than money to keep your employees satisfied and productive, it is also true that employees that feel they are underpaid are not happy in the job. 74% of employees have their salary reviewed on an annual basis. 69.5% of candidates believe it is necessary to move companies in order to gain greater bargaining power in salary negotiations. The infrequency of salary reviews may be the reason why the majority of respondents feel the need to move companies to increase bargaining power. When an employee works for less than their market worth a company will pay the difference in the long run.
   
   
3. Work environment
   The culture of an organisation often sets the scene for a happy and productive working environment. In a lot of cases companies rely primarily on salary and ‘perks' to prevent employees leaving. Our experience shows that additional factors, most notably a lack of respect and recognition causes as much employee dissatisfaction as insufficient compensation.
   
   
4. Improved work - life balance
   Ensuring that a department is not understaffed is one of the key factors to a healthy atmosphere. It is beneficial for an organisation to show flexibility in working hours by either being creative with start and/or finish times, reducing ones' working hours or giving ‘time in lieu', which will also assist in overall productivity.
   
   
5. Increased responsibility
   Management and senior staff currently work longer hours when they could be delegating and empowering staff. Developing staff by giving them increased responsibility is under-utilised. Laying out milestones for each team member to achieve will allow for delegation.
   
   
6. Change of career path
   This is often overlooked within organisations. When employees want to change their career direction usually they do not consider doing it within their current organisation. Knowing the long term career goals of each individual is vital to the success, not just of the individual, but it can also benefit the company.
   
   
7. Overseas opportunities
   Overseas experience is a definite bonus for professionals and viewed positively by future employees. However, how can organisations take advantage of the benefits and overcome the threats posed by global markets? Overseas travel is not a new trend within the workforce, but ensuring professionals return is. High salaries and low tax structures seem to be the main lure to other countries. 
   
   
8. Stronger economy
   Employees are aware that in a market where there is higher demand versus supply they are in a position to negotiate and usually feel more comfortable doing this with a new employer. It is known that in a candidate short market where there is a global war for talent, good candidates are being headhunted almost daily.
    

In order to retain staff, each organisation needs to implement a clear strategy for staff retention:

• Hire effectively in the first place. Know what you are looking for and set transparent expectations of the position.
  
  
• Know what motivates your staff. Ensure you are working for the individual.
  
  
• Let your people know they count. Praise is often as good as a pay rise.
  
  
• Promote from within. Ensure to provide opportunities for advancement.
  
  
• Conduct regular salary reviews. If possible every six months in line with market values.
  
  
• Develop a team environment. Include and empower staff in decision making. Team spirit comes from management.
  
  
• Provide extra benefits. This in turn will bring benefits to the employer.
  
  
• Conduct exit interviews to understand why employees leave an organisation.

Nicole Gorton, Director, Robert Half International. For further information visit the website: www.roberthalf.com
First published: 14 December 2006.
Last updated: 14 December 2006.