How You Can Improve Employee Retention in Your Organization
- HCM
- Artículo
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Lectura de 6 minutos
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Last Updated: 04/10/2019

Table of Contents
If your business isn't focused on improving employee retention, this could be cause for concern. In a competitive job market, it is essential to focus on improving employee retention, so that you're not expending time and financial resources in the recruitment process.
There are a variety of factors that may influence an employee's decision whether to stay with an organization. However, there are concrete steps you and your HR team can take in an effort to increase employee retention.
Uncover reasons behind employee turnover
Employees leave a company for many reasons — lack of growth opportunities, disappointment with salary expectations, a general feeling of mistrust or disrespect, or other factors. To identify the source, it's important to open the lines of communication with your employees.
Employee retention programs can help businesses improve morale, reduce costs, and retain their core talent. To accomplish those goals, businesses often focus their retention programs on:
- Improving hiring strategies
- Streamlining the onboarding process
- Offering competitive compensation
- Fostering a positive work environment
The following considerations can help you identify what's needed to retain employees for your business, and how to improve employee retention efforts overall.
Measuring employee retention
Many business owners and HR professionals use employee retention metrics to evaluate the quality of their hiring programs and overall health of their workforce. To calculate this statistic at a basic level, subtract the number of employees who leave in a given period (i.e. quarterly) from the entire workforce, then divide that figure by the total number of employees.
For example, if you regularly employ 20 workers and three resigned or were terminated during the first quarter, your employee retention rate would be (20-3) / 20 = 0.85 or 85 percent. This percentage can vary across different industries and in different parts of the country, so this benchmark is most valuable as an internal metric evaluated over time.
It's important to identify why employee turnover occurs and develop plans to help retention. For instance, an employee may have been hired quickly, but was inadequately onboarded, or didn't fully understand the expectations of the job. If so, you may want to reemphasize to hiring teams the importance of recruiting the most qualified individual for any position, and prioritizing a long-term fit during this process.
Improve the recruitment process
If the issue seems to be related to an internal issue, try to identify the root of the problem. For example, employees are more likely to stay at a job when they have a clear understanding of their individual career development path. From a recruiting standpoint, help candidates understand where each position could lead. For your existing workforce, take the time to find out what their goals are and discuss different strategies for achieving them, from allowing them to take on more responsibility on a project to helping defray the cost of their education.
If your workers are generally engaged and your retention metrics are strong, keep in mind that effective retention efforts are continuous. A centralized HR management system can help you keep an eye on metrics in this area, and discover trends and insights over time. By evaluating any changes in your retention numbers, you can identify potential issues within your organization and work to resolve them.
Employees and managers working together
When it comes to addressing employee retention, businesses may fail to support one of the most important relationships that define a worker's day-to-day experience: the interaction between managers and employees.
Employees may be less likely to leave due to large, overarching issues or concerns with the way that a company is performing. More commonly, attrition is related to the quality of an employee's daily routine and work environment.
Managers have a significant amount of control over the employee experience, from what they work on to the input they receive on the results. Are your employees guided and recognized, or reprimanded and stressed? Are the manager-employee lines of communication open to share ideas, or do employees feel they could get in trouble for asking questions? Your company's managers can become your most important ambassadors for employee retention.
Establishing employee retention as an important metric can help give managers the incentive they need to focus on retaining talent. Options include:
- Provide information to managers on why employee retention is important to the company, including the costs of replacing workers who leave.
- Consider making employee retention an explicit key performance indicator (KPI) for manager evaluations.
- Invest in basic management training on communication, goal setting, and other important skills for managers who oversee other staff members.
It's important that your managers have time in their schedules to actively interact with employees. HR needs to consider timing when developing manager allocations, and they should periodically check-in with managers in areas where they can use support.
What else can your managers do to help keep employees engaged?
Look beyond the obvious. Sometimes managers focus on star performers at the expense of "hidden gems" on their teams. Look beyond positions and job titles. Consider each employee's skills, institutional knowledge, direct relationships, and networks that are just as important to fostering retention.
One size does not fit all. Your team is a complex group of individuals. What motivates one may not motivate another. Explore alternative incentives like flexible schedules and time off, job sharing, or work-from-home opportunities. Leadership development, mentoring, and expanded job responsibilities can also provide workers with opportunities to stay engaged and challenged.
Invest in learning opportunities. Employees often become disengaged at work when there is a lack of opportunities to expand their skill sets. Managers can encourage their workers to take advantage of professional development training. By thinking of innovative ways to enhance employees' learning, your managers can also help develop a next generation of leaders.
Get feedback and take action. Your workforce can quickly disconnect if their ideas and comments remain unaddressed. While a business can't accommodate every employee suggestion, managers can build trust by asking for input and listening to their employees' feedback. Also, receiving multiple requests for the same change can give the business a good sense of which changes are a priority for the workforce as a whole.
Be mindful of high-risk employees. If key employees are at risk of leaving, managers need the training to identify them and address the issue.
For example, staff in highly in-demand positions may be more likely to receive a competing offer from a rival firm. Workers who have expressed a desire for more compensation or a more flexible work situation — and who felt their needs went unheard — could be considering a new job. In such a scenario, companies can make important decisions with respect to recognition, compensation, or accommodating other requests. Establish clear communication channels so your HR team can partner with management to retain high-value talent.
Ideally, managers should review work, provide feedback, and meet with employees on a regular basis. At the same time, there should be a continuing focus on each employee's growth goals, learning opportunities, and future trajectory with the company. Managers who are focused on these issues and actively discussing them with employees can play an important role in helping businesses retain top talent.
Addressing millennial employee retention factors
There's a lot of discussion about generational differences in the workplace. Compensation and the quality of the work experience remain important across segments, but failing to understand how different generations may have different expectations and preferences can lead to challenges at all levels of the organization.
For millennials, key retention factors often include options for telecommuting, flexible scheduling, freelancing, and job sharing. As their careers advance, they may become more concerned about work/life balance, whether it's in response to family demands, health, or outside interests. Companies offering some flexibility are often able to hire (and retain) more millennial talent by experimenting with unlimited vacation time and implementing structured telecommuting policies.
Of course, you must be realistic about what works for your company, workflows, and culture. However, in general, the more you can offer flexible benefits, the easier it may be to retain millennial employees.
Collaboration and feedback are also critical to keeping millennials satisfied at work. Forward-thinking businesses now invest in collaboration technologies that enable colleagues down the hall and around the globe to work together. Find ongoing ways to support learning and collaboration, from formal mentorship programs to investment in training, and you'll probably see a favorable uptick in retention.
The role of HR technology
An effective retention strategy begins with recruiting the right employees. By leveraging the resources of human capital management software, it's possible to target your efforts on finding ideal candidates for specific positions and for your company culture.
With today's applicant tracking systems, you can:
- Develop job descriptions with input from all stakeholders
- Set minimum screening criteria to focus on the most qualified applicants
- Access data for the entire recruiting process from a single interface
With smoother operations, better screening tools, and access to data, recruiters could attract a higher caliber of employee. Starting with the right employees makes it easier to increase employee retention beginning on day one.
Employers shouldn't make the mistake of seeing employee retention as a narrow, HR-only matter. With the right HR management system, resources from throughout the organization can provide a more holistic approach to this challenge.
If employee data is coming at you from multiple systems or you feel constantly required to help managers and staff sort through issues of scheduling, benefits and other retention-based strategies, it may be time to consider an HR management system. It could be one of the smartest steps you take in making strong employee retention a reality in your business.
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