Glossary of Human Resources Management and Employee Benefit Terms
A retention strategy is a plan that organizations create and use to reduce employee turnover, prevent attrition, increase retention, and foster employee engagement. While some turnover is inevitable, building a retention strategy to prevent as much voluntary turnover as possible can save an organization a lot of time and money. After all, it’s much easier and much less expensive to train and develop your current employees than it is to continually hire new people.
The focus of an employee retention strategy is just as it sounds: retaining employees. However, there are other positive outcomes of an effective retention strategy besides just getting people to stick around your organization longer:
Lower hiring costs
Increased employee productivity
Higher employee satisfaction
Stronger work relationships
Less work-related stress
This means that creating a retention strategy isn’t just a good idea if you’re experiencing higher-than-average turnover; it’s a good idea for any organization that wants to improve its culture, employee experience, business outcomes, and more.
When developing an employee retention strategy, it’s important to identify the areas of the employee experience you can actually influence so you know where to focus your efforts. These areas may include:
Environment: Improving an organization’s work environment as part of an employee retention strategy might mean creating more quiet spaces where employees can focus, opening up office space to encourage collaboration, or even offering flexible work hours and work-from-home options.
Culture: Your organization should develop a culture that makes employees want to stick around, especially when you consider that nearly half of all people looking for new jobs cite company culture as the main reason they decided to leave their last job.
Benefits: Offering competitive employee benefits can also increase retention. Healthcare is among the most important benefits an organization can provide. Beyond that, choosing benefits that align with what your employees value can increase employee satisfaction.
Professional Development: Professional development is a priority for many employees, especially millennials. Demonstrating to employees that they have opportunities to learn and grow at your organization can encourage them to stay longer.
Rewards and Recognition: Nobody wants to feel unappreciated. If employees feel like their hard work and great results aren’t being recognized at your organization, they will be more likely to leave.
A good start to improving the right kind of retention is to make sure you’re paying fairly and competitively to the market. In fact, research shows a link between fair and transparent pay practices, lower intent to leave, and overall greater job satisfaction.Watch Now
Retaining your best people creates true competitive advantages. This is especially true for small and medium-sized businesses. Learn seven powerful strategies to retain your best people.Download Now