Strategies for Reducing Turnover Costs

At The Rainmaker Group we are committed to helping your organization Maximize Possibility by identifying and retaining top performers to achieve a high retention and high performance workforce.

We understand that time is money to your organization. Every minute of every day that your employee retention problems persist your organization is losing valuable time, energy, and resources.

With the use of the powerful tools at our disposal, our employee retention experts will get to know your team and organizational culture better than you ever could have imagined. By doing so we can get down to the real causes of employee turnover in your organization and develop an employee retention program that is right for your team.

Our employee retention programs deliver results - we guarantee it!

Our clients always see a sizable return on investment in the form of improved profitability, reduced employee turnover, and enhanced employee morale.

Stop unwanted employee turnover dead in its tracks and get back to doing what you do best: growing and leading your organization.

Three Rs of Employee Retention

Respect is esteem, special regard, or particular consideration given to people. As
the pyramid shows, respect is the foundation of keeping your employees.
Recognition and rewards will have little effect if you don’t respect employees.

Recognition is defined as “special notice or attention” and “the act of perceiving
clearly.” Many problems with retention and morale occur because management is
not paying attention to people’s needs and reactions.

Rewards are the extra perks you offer beyond the basics of respect and
recognition that make it worth people’s while to work hard, to care, to go beyond
the call of duty. While rewards represent the smallest portion of the retention
equation, they are still an important one.

You determine the precise methods you choose to implement the three Rs, but in
general, respect should be the largest component of your efforts. Without it,
recognition and rewards seem hollow and have little effect—or they have negative
effects. The magic truly is in the mix of the three.

Rewards
Recognition
Respect

When you implement the “three Rs” approach, you will reduce turnover and
enjoy the following:

Increased productivity

Reduced absenteeism

A more pleasant work environment (for both employees and you!)

Improved profits

Furthermore, an employer who implements the three Rs will create a hard-toleave
workplace, one known as having more to offer employees than other
employers. You become a hard-to-leave workplace—one with a waiting list of
applicants for any position that becomes available—purposefully, one day at a
time.

Retention Success Reasons

A transparent work environment can serve as one of the primary triggers to facilitate accountability, trust, communication, responsibility, pride and so on. It is believed that in a transparent work culture employees rigorously communicate with their peers and exchange ideas and thoughts before they are finally matured in to full-blown concepts. It induces responsibility among employees and accountability towards other peers, which gradually builds up trust and pride. More importantly, transparency in work environment discourages work-politics which often hinders company goals as employees start to advance their personal objectives at the expense of development of the company as a single entity.

Employees comprise the most vital assets of the company. In a work place where employees are not able to use their full potential and not heard and valued, they are likely to leave because of stress and frustration. In a transparent environment while employees get a sense of achievement and belongingness from a healthy work environment, the company is benefited with a stronger, reliable work-force harboring bright new ideas for its growth.

Quality Of Work

Providing quality work life involves taking care of the following aspects:

Occupational health care: The safe work environment provides the basis for the person to enjoy working. The work should not pose a health hazard for the person. The employer and employee, aware of their risks and rights, could achieve a lot in their mutually beneficial dialogue.

Suitable working time: Organizations are offering flexible work options to their employees wherein employees enjoy flexi-timings for dedicating their efforts at work.

Appropriate salary: The appropriate as well as attractive salary has always been an important factor in retaining employees. Providing employees salary at par with the other counterparts of above that what competitors are paying motivates them to stick with the company for long.

Providing quality at work not only reduces attrition but also helps in reduced absenteeism and improved job satisfaction. Not only does QWL contribute to a company's ability to recruit quality people, but also it enhances a company's competitiveness. Common beliefs support the contention that QWL will positively nurture amore flexible, loyal, and motivated workforce, which are essential in determining the company's competitiveness.

Providing quality at work not only reduces attrition but also helps in reduced absenteeism and improved job satisfaction. Not only does QWL contribute to a company's ability to recruit quality people, but also it enhances a company's competitiveness. Common beliefs support the contention that QWL will positively nurture amore flexible, loyal, and motivated workforce, which are essential in determining the company's competitiveness.

Employee Support

Management can support employees, indirectly, in a number of ways as Follows:

Manage employee turnover: Employee turnover affects the whole organization in terms of productivity. Managing the turnover, hence, becomes an important task. A proactive approach can be adopted to reduce attrition. Strategies should be framed in advance and implemented when the times arrives. Turnover costs should also be taken into consideration while framing these strategies.

Become employer of choice: What makes a company an employer of choice? Is the benefit it offers or the compensation packages it gives away to its employees? Or is it measured in terms of how they value their employees or in terms of customer satisfaction? Becoming an employer of choice involves following a road map which tells where to go as a brand.

Engage the new recruits: The newly hired employees are said to be least engaged in the organization. Keeping them engaged is an important task. The fresh talent should be utilized to maximum before they start feeling bored in the organization.

Optimize employee engagement: An organization’s productivity is measured not in terms of employee satisfaction but by employee engagement. Employees are said to be engaged when they show a positive attitude toward the organization and express a commitment to remain with the organization. Employee satisfaction also comes with high engagement levels. So, organizations should aim to maximize the engagement among employees.

Communication Between Employee and Employer

Communication is a process in which a message is conveyed to the receiver by the sender. The message may be or may not be in a common format or language that both the sender and receiver understand. So there is a need to encode and decode the message in the process. Encoding and decoding also helps in the security of the message. The process of communication is incomplete without the feedback. Communication is the solution to almost everything in this world. Same applies to employee retention also.

Straight-from-the-shoulder communication is what the employees need from their employers. Employees look for organizations where communication and process are transparent. Nothing is hidden and shared with the employees.

Reason for Leaving

Job is not what the employee expected to be: Sometimes the job responsibilities don’t come out to be same as expected by the candidates. Unexpected job responsibilities lead to job dissatisfaction.

Job and person mismatch: A candidate may be fit to do a certain type of job which matches his personality. If he is given a job

which mismatches his personality, then he won’t be able to perform it well and will try to find out reasons to leave the job.

No growth opportunities: No or less learning and growth opportunities in the current job will make candidate’s job and career stagnant.

Lack of appreciation: If the work is not appreciated by the supervisor, the employee feels de-motivated and loses interest in job.

Lack of trust and support in coworkers, seniors and management: Trust is the most important factor that is required for an individual to stay in the job. Non-supportive coworkers, seniors and management can make office environment unfriendly and difficult to work in.

Stress from overwork and work life imbalance: Job stress can lead to work life imbalance which ultimately many times lead to employee leaving the organization.

Compensation: Better compensation packages being offered by other companies may attract employees towards themselves.

New job offer: An attractive job offer which an employee thinks is good for him with respect to job responsibility, compensation, growth and learning etc. can lead an employee to leave the organization.

Advantage Of Employee Retention

Importance Of Employee Retention

1. The Cost of Turnover: The cost of employee turnover adds hundreds of thousands of
money to a company's expenses. While it is difficult to fully calculate the cost of turnover (including hiring costs, training costs and productivity loss), industry experts often quote 25% of the average employee salary as a conservative estimate.

Loss of Company Knowledge: When an employee leaves, he takes with him valuable knowledge about the company, customers, current projects and past history (sometimes to competitors). Often much time and money has been spent on the employee in expectation of a future return. When the employee leaves, the investment is not realized.

Interruption of Customer Service: Customers and clients do business with a company in part because of the people. Relationships are developed that encourage continued sponsorship of the business. When an employee leaves, the relationships that employee built for the company are severed, which could lead to potential customer loss.

Turnover leads to more turnovers: When an employee terminates, the effect is felt throughout the organization. Co-workers are often required to pick up the slack. The unspoken negativity often intensifies for the remaining staff.

Goodwill of the company: The goodwill of a company is maintained when the attrition rates are low. Higher retention rates motivate potential employees to join the organization.
Regaining efficiency: If an employee resigns, then good amount of time is lost in hiring a new employee and then training him/her and this goes to the loss of the company directly which many a times goes unnoticed. And even after this you cannot assure us of the same efficiency from the new employee

Employee Retention

Employee Retention involves taking measures to encourage employees to remain in the organization for the maximum period of time. Corporate is facing a lot of problems in employee retention these days. Hiring knowledgeable people for the job is essential for an employer. But retention is even more important than hiring. There is no dearth of opportunities for a talented person. There are many organizations which are looking for such employees. If a person is not satisfied by the job he’s doing, he may switch over to some other more suitable job. In today’s environment it becomes very important for organizations to retain their employees. The top organizations are on the top because they value their employees and they know how to keep them glued to the organization.

Employees stay and leave organizations for some reasons. The reason may be personal or professional. These reasons should be understood by the employer and should be taken care of. The organizations are becoming aware of these reasons and adopting many strategies for employee retention. In this section we are going to study about various topics related to employee retention, why is it needed, basic practices, myths, etc. in detail.

Employee Retention Strategies

Employs an easy-to-understand systems approach to ensure the root causes of turnover are addressed and the potential for lasting change unleashed.

Customizes all activities to your organization’s unique history, current practices and strategic objectives. Also considered are challenges unique to your industry sector, competitive marketplace issues and talent shortages.

Involves those responsible for implementing change in actually creating the change, ensuring input and improved shared understanding and support of all initiatives.

Integrates hands-on, action-oriented approaches that enable organizations to move forward quickly and effectively

Recognizes the research-proven role of no-cost strategies in developing the “glue” that builds employee loyalty and commitment.

Brings to your organization leading-edge organization-development best practices to effectively and quickly build a retention-rich culture.

The quality of the supervision an employee receives is critical to employee retention. People leave managers and supervisors more often than they leave companies or jobs. It is not enough that the supervisor is well-liked or a nice person, starting with clear expectations of the employee, the supervisor has a critical role to play in retention. Anything the supervisor does to make an employee feel unvalued will contribute to turnover. Frequent employee complaints center on these areas.

--lack of clarity about expectations,

--lack of clarity about earning potential,

--lack of feedback about performance,

--failure to hold scheduled meetings, and--failure to provide a framework within which the employee perceives he can succeed.

The ability of the employee to speak his or her mind freely within the organization is another key factor in employee retention. Does your organization solicit ideas and provide an environment in which people are comfortable providing feedback? If so, employees offer ideas, feel free to criticize and commit to continuous improvement. If not, they bite their tongues or find themselves constantly "in trouble" - until they leave.

Retention Factors

Employee Retention factors include:

*Communication
*Recognition and appreciation
*Effectiveness of managers
*Responsibility and challenge
*Promises kept and broken
*Expectations and expectation gaps
*Corporate Culture
*Rewards and Compensation
*Training and development
*Autonomy, empowerment
*Advancement potential
*Intent to leave or stay, and in what time period
*Themes and trends: getting worse or better
*Work environment
*Organizational fairness
*Fun at work
*Organizational pride and brand
*Resources to do job
*Trust and respect
*Reasonable deadlines, hours of work, health and working conditions
*Leadership of company
*Loyalty, commitment and intent to stay
*External pull to other jobs and competitors