Retain your best people

Employers today are facing a serious talent crunch. Apart from the already tight labour market, employers are also grappling with the retirement of baby boomers, movement of global talent and staff leaving the workforce in pursuit of other personal interests. Such situations stress the magnitude of attracting the right people, and keeping them – especially since talent retention affects many organisational issues such as transfer of knowledge and skills, staff morale and resources invested in recruitment.

But why do companies still lose valuable talent? 

The hard costs of employee attrition

It may cost 30%-50% of the annual salary of entry level staff, and 150% of mid-level employees, but it costs up to 400% for high level executives. On top of the value of employee compensation and benefits, resources are expended to hold exit interviews, place job advertisements, interview prospective employees, and hire and train new staff. And more money is spent to hire temporary workers as the search for permanent replacements is time-consuming.

The loss of good talents is also erosion of team morale, loss of productivity and of existing and potential customers.

Keep valuable talent from leaving
There are several organisational issues which they can take note of to boost employee retention:

Set proper key performance indicators (KPIs) and clearly communicate expectations. Changing expectations or worse, no KPIs communicated to staff may leave staff confused and uncertain of what is expected of them.

Recognise and reward. Staff rewards do not necessarily have to come in monetary form, even a simple thank you goes a long way. 

Have good managers. The quality of leadership can greatly affect staff retention. People do not leave organisations, they leave bad bosses.

Employees should be seen and heard. Employees should be encouraged to give ideas and feedback for the better of the organisation, and feel their contributions matter.

There should be fairness and equitable treatment. Playing favourites or treating some as “more equal” than others is a sure way to kill motivation, erode morale, respect and productivity.

­­­­Share information. Information sharing is important at all times, but critical during period of change such as downsizing, mergers and acquisitions.

Promote work-life harmony. Work-life harmony policies focus on performance rather than the number of hours employees put in working behind their desks at the office. It allows staff to better cope with family responsibilities without sacrificing performance at work.

Train and develop talent. Having suitable training policies and mapping out career paths demonstrates the employer’s commitment to developing staff skills and knowledge.

HR’s role

Employee retention is one of the primary indications of the health of an organisation. It is a collaborative effort between managers and the HR department to retain talents. Gathering information from exit interviews with departing employees and conducting staff satisfaction surveys from time to time will help give management an indication of the state of things in the organisation. Such information will also be helpful in refining staff retention practices and policies.

Contributed by:

Josh Goh

Assistant Director, Corporate Services

The GMP Group