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How not to lose a high value employee

Retain your best employees with these cost-effective measures

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Losing a high-value employee is never welcomed, and it can have significant costs for an organisation.

The costs can reach as high as 50%-60% of an employee’s annual salary, with total costs associated with turnover ranging from 90% to 200% of annual salary. (SHRM)

There are the various direct and indirect costs, including recruitment, hiring, training, lost productivity during the transition period, as well as the potential impact on team morale and customer relationships.

Plus harm to organisations can be high when considering the loss of specialised skills, experience, and knowledge that high-value employees often possess.

In the current economic climate of 2023, with concerns about high interest rates, and the high cost of living, it is more important than ever for companies prioritise high-value employee retention.

Here we look at the impact of SMEs losing a top staffer, and ways you can retain your high value employees, without incurring major costs.

Turnover Is Tougher on Small Organisations

According to SHRM, the loss of key employees can have a particularly damaging impact on small organisations:

•       Departing workers are more likely to be the only ones possessing a particular skill or knowledge set.

•       A small company’s culture suffers a more serious blow when an essential person leaves.

•       There is a smaller internal pool of workers to cover the lost employee’s work and provide a replacement.

•       The organisation may have fewer resources available to cover replacement costs.

No wonder the exit of high performers and employees with hard-to-replace skills, and departures of women or minority group members that erode the diversity of your company’s workforce are described as “dysfunctional turnover.”

Ways to retain high-value employees

Despite economic concerns, investing in high-value employee retention remains a wise strategic choice for companies.

Here we look at some of the ways you can do that - and do so cost-effectively.

Personalise the work experience

Founder of TalentCode HR Trudy McDonald says to retain staff, it is crucial to personalise their work experience (see details of her November 2023 live virtual masterclass). She recommends the following actions:

·       Have personalised conversations with employees to understand their values, aspirations, and goals. Encourage leaders and managers to build personal connections with their teams.

·       Ask employees about their job satisfaction and what could be done to make their role more fulfilling. In a challenging economic environment, it becomes essential to focus on employee job satisfaction and fulfillment.

·       Ensure leaders and managers hold employees accountable by setting goals and having regular check-ins. This promotes engagement and creates a high-performance environment. According to accountability expert Mark Green, top performers prefer high accountability workplaces.

Tap into their deep-seated need to grow

Research shows almost 94% of employees will stay longer at an organisation if they receive adequate career training and development. 

Plus, 36% of employees named 'continuous learning opportunities' as a key engagement factor, alongside work-life balance, career advancement, employer ethics, and organisational stability.

Our interview with Whitney Johnson, author and CEO of Disruption Advisors, explains why it's so important.

“There is a yearning, deep-bellied, to learn and grow," she says."Starting to coast is a bad idea, comfort zones are the bane of growth.”

When employees take part in training programs, they feel noticed and appreciated, they improve their knowledge of the role, their confidence in their own abilities, and they widen and deepen their skillset.

The impact of training and development on an employee's improved sense of self, job satisfaction, and improved ability to contribute cannot be underestimated. 

Match their expectations

Several other factors contribute to employee attrition, including increased job opportunities, changing attitudes towards work due to COVID-19, and the desire for non-traditional roles or lifestyle changes.

To address these challenges, Trudy suggests companies consider:

·       Remuneration: Fair pay is the top reason people stay or leave their jobs. So, fair and competitive compensation becomes increasingly important in uncertain economic times. Leaders should benchmark salaries, ensure internal equity, and communicate the fairness of compensation.

·       Purpose: Employees want to work for organisations with a clear direction and meaningful work. Refreshing the strategic plan and engaging employees in the organisation's goals and vision can help foster a sense of purpose.

·       Flexibility: Flexible work arrangements are now the norm. A study by Skynova found that 65.4% of employees had flexible work schedules, and more than half said that they appreciated these arrangements even more than their salary. 

·       Trust and accountability: Creating a transparent and accountable work environment builds trust among employees. Clearly define expectations, hold everyone accountable, and promote transparency in decision-making. This is trust and inspire leadership.

·       Mental health and well-being: Balance challenge and support in the work environment. Encourage open dialogue, provide constructive feedback, and create a psychologically safe workplace.

·       Constructive feedback: Recognise and appreciate employees through constructive developmental feedback. Train leaders and managers to provide specific feedback using the S.B.I. method (Situation, Behaviour, Impact).

By implementing these strategies, companies can improve high-value employee retention and create a more engaging and fulfilling work environment.

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