Retaining talent in your business as it scales is not easy.
As we mentioned in one of our previous articles on when employees are most likely to leave, people switch jobs more than ever before, so being able to increase retention levels on your journey of growth requires investment.
But away from people wanting more money, more flexible working, or hating their boss, what are the other reasons companies who are going through significant growth lose staff?
And what can you do to stop it?
With the cost of replacing someone estimated at up to 400% of their basic salary (according to HRI Online) for senior staff this is definitely a worthy topic.
We compiled some thoughts based on experiences with companies we’ve worked with.
Clarity on your vision.
A Gallup poll showed as many as 41% of employees felt that they did not understand or believe in their company’s vision. Without clear direction on this, people don’t know what they’re buying into.
Now, some people won’t care about it and just ‘do the job’. However, the best talent have their choice of employer and if you want to attract and retain them, you need to make sure they believe in what you’re doing.
Much of this comes back to a wider employer branding piece – more specifically your Employee Value Proposition (EVP) - that lays out what your “underlying offer” is too them and why they should come on the journey of growth with you.
Is the mission for the company founders only? Can people really see themselves as part of a company’s journey across 2/3/5/10 years?
Losing your best people because they don’t believe in the journey you’re on and understand their role in it is costly.
Give clearly defined roles.
People need to understand their job. Not only at the moment that they join the business but how it will evolve over time and as the company grows.
There are no guarantees of course, but we know from experience that spending time mapping out roles and their trajectory is key to attracting and retaining talent. Using data-led insight to build out clear and accurate descriptions creates a level of assurance and stickability for the talent in your business.
At Talent Point, accurately defining roles and career paths is core to being able to deliver an on average 3-2-1 interview-to-hire ratio for our partners. Check out our case studies to see for yourself.
We’ll cover career paths more next, but doing this one part well and ‘going-to-market’ with a role that matches skills availability, and salaries, you’ll massively improve your ability to hire quickly and hire well.
If you’re clear with people from the outset they’ll trust you more for the long-term.
First impressions count. But career progression is key to employee retention.
If you have a disconnect between what you are promising and then delivering when it comes to applicant and employee experience, then you’re already on the back foot when it comes to trust.
If you’re promising something at interview, make sure you do your best to deliver on it.
The talent you have worked so hard to attract and hire may not leave straight away but it’s certain there will always be a niggling doubt at the back of their minds.
Have a robust onboarding programme that is able to reinforce the key messages of the business and double down on the importance of the individual’s role in the company.
Clear 30/60/90-day plans need to be in place.
But that’s just the start. You also need to address skills development and progression. People want to learn new things, they want to have a variety of projects throughout their career, they want to evolve as a person and professional.
We discussed earlier using data-led insight understand skills availability and career paths. Getting progression right starts when you map out a hire, not at their 1st yearly review when you’re worried about losing them.
Get a structure in place for progression, take it seriously and it evolve it with alongside your team to keep them engaged and more likely to stay at your company for longer.
Remember, your employer brand exists whether you like it or not – you need to make sure that it’s a positive one and that starts internally with your employee value proposition.
Communication matters but employee engagement is even better.
You’ll have business goals for sure. You’ll (hopefully) believe that you have your plan nailed down and have communicated it well. But maybe you’re are missing a trick.
Being able to tap into the sentiments and insights from your teams at regular points is invaluable. Not only do you surface ideas you might otherwise have missed, you understand the challenges they face better and can identify those who are less engaged so you can do something about it.
If people feel included in the plans of the business and how it will benefit them (and the wider world potentially) they are unlikely to simply see you as a pay check.
Another Gallup study showed 52% of employees in America are not engaged and 18% are actively disengaged – costing and estimated $450 billion to $550 billion in lost productivity per year.
What are you spending yearly on salaries?
Now take half of that number and assume it’s at high-risk due to lack of employee engagement.
That’s a big chunk of your budgets and one you probably can’t afford to lose.
Pay a fair wage but STOP throwing money around.
Compensation matters. It’s pretty simple.
That does not mean that paying more money on a whim will improve your retention.
In a recent article about why startups fail, we discussed how rewarding the wrong behaviours can have a serious impact on your ability to build a happy and effective team that can deliver on business goals.
Do not, under any circumstances, continue to pay your ‘Rockstar Developer’ more and more money simply because they’re demanding it as they’re the only one who ‘knows the system’.
Whilst this may solve a short term problem, it will alienate others and before you know it you may have lost too many other people for that person to be effective anyway.
Rather, invest in understanding what fair compensation is for every role in your business and focus on the other points discussed in this article.
At the risk of sounding repetitive. Improving employee retention comes down to careful planning.
No company is ever going to have 100% employee retention.
But as you go on your story of growth and change as a business, being able to retain staff is essential to ongoing success.
We’re in the world of finding talent for scale-up businesses and that often means convincing people to move from their current employer. What stands out for those companies who are able to do that is being able to show that the individual matters.
That comes through careful planning of job roles, compensation, benefits packages, and a lot more. Not just for this moment in time, but for the future as well.