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Focussing on retaining your talented workforce should be a key priority to keep your organisation ahead of the competition. According to Accounts and Legal, a UK small business accountant, the average cost for a SME to replace a member of staff is £11,000. This cost increases for larger businesses and significantly so for industries who see a high staff turnover.
The true cost of recruitment
To fully appreciate the need for a retention strategy it pays to find out the cost of recruiting a member of staff for your organisation. These are the areas you will need to consider:
Creating the job specification
Screening all applications
Initial screening calls
Preparing for the interviews
Holding the interviews
Onboarding, training & handovers
Figures from 2018 reveal that an average of 118 people apply for a given role. When you calculate the time needed to screen this many applications multiplied by the hourly rate of the members of staff managing the process, the cost soon becomes apparent.
When a new employee starts, their productivity will naturally be at its lowest as they get up to speed with their role. A new starter also takes up the time of other, more experienced staff, who carry out the on-the-job training which reduces their productivity for a period of time.
There are also the intangible costs to consider for a high retention level such as the damage to your brand’s reputation and the reduction in morale across the remaining employees.
Why are staff leaving?
Relying on exit interviews to discover the reason why individuals are leaving is not sustainable, it’s simply too late at this stage. Measuring satisfaction across the whole workforce is an incredibly worthwhile exercise. You can do this through annual Employee Engagement Surveys.
Smart retention strategies
While some staff turnover is good for business, as new starters bring with them fresh ideas and approaches, a smart retention strategy should be in place to retain the top talent and high performers.
Such a strategy must address the different needs of all employees. They will want to receive an appropriate salary and monetary benefits, but equally they will want to feel appreciated, consider themselves to be treated fairly and be excited and challenged in their role. An effective strategy must kick-in on a new starter’s first day to set the tone which will remain with them, hopefully for many years, securing long-term job satisfaction.
Here are methods to improve your staff retention and keep hold of your experienced employees:
Robust recruitment process
Well defined job descriptions
Career development
Regular one to one meetings with manager
Annual review
Flexible benefit packages
Effective policies for a diverse and inclusive workforce
Health and wellbeing initiatives
Leadership training for all managers
Employee recognition and reward programmes
Mentorship programmes
Celebrate success
Long-term employees
Experienced members of staff understand your organisation, the core values and your particular approach to business enabling them to become innovative in the way they support the growth of the company. These employees will promote your brand and become ambassadors as they are likely to discuss how well they are cared for at work with friends, family members and customers.
When it comes to training new starters, the experienced members of staff will become invaluable at articulating the goal of the company as well as teach how, as a team, they will achieve it.
Keeping these members of staff is key to success and your company will be at a huge disadvantage if they were to take their skills and knowledge to a competitor.
Strong leadership
Employees look for structure, integrity and direction. They crave trust and autonomy where possible and favour those who can lead them not necessarily manage them. Look to coach and promote from within as your existing employees have already adopted your organisation’s culture and values.
A flexible approach
Offering flexible working will have a positive effect on your retention levels. If your organisation does not have flexibility in your policies, then you may find employees leaving to work with a company who can support their work-life balance.
To successfully implement flexible working and the continuity of communications the right technology hardware and software is needed. Just as importantly is the need for trust; trust that the employees are still working towards their objectives but in their own way.
Strong workplace culture
Having low levels of staff turnover is good for morale and productivity. It demonstrates that the employer doesn’t consider their most valuable asset – the workforce – to be a replaceable resource. This feeling of being valued and trusted uplifts and motivates employees creating a highly productive, supportive and happy environment which filters through to customers.
How we can help you
If you’d like to discuss any of the issues detailed in this blog, get in touch with us today. We’re here to help.
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