Since 2011, the number of workers who have quit their job within a year doubled from 20 to 42 million. According to data from Visier, one in four workers left their job in 2021, and if this trend continues, the number could grow to one in three workers, according to the “2020 Retention Report” by Work Institute. It is these kinds of statistics that lend themselves to the murmurings and fears surrounding the Great Resignation.
Although it’s impossible to know the future, these trends emphasize how important it is to be a company that hires those other two or three workers who are going to stay. Even more so, it is imperative to learn what habits and actions create a culture where employees feel valued, respected and genuinely want to work with you. An employer who is capable of doing that will be successful in any industry.
Excluding all else, the fundamental fix to employee retention issues boils down to performing three critical tasks and performing them well.
Recruit top-tier talent.
The first step to resolving employee retention issues starts with recruiting top talent. Conventional wisdom would indicate that employees initially choose their roles for one of a few reasons. Some are:
• Whether the market compensation is above-market or if the position offers financial advancement and a low opportunity cost.
• How the organization is perceived, true or not, and the cultural fit.
• The comprehensive quality of work. This includes factors such as difficulty level, social prestige, substance, exposure or whether the opportunity acts as a doorway to a future path.
However, each person is unique and may attach personal value to any of the above workplace characteristics or none at all. Moreover, Adrienne Selko in an IndustryWeek article emphasizes the qualitative importance of a person’s experience in work culture. Perhaps this is why select businesses or governmental agencies, like the Department of State, are better able to recruit elite talent from the get-go.
A key part of recruiting talent is assessing culture fit. The right corporate culture can be instrumental in both attracting and ultimately retaining top talent. In fact, if culture is out of whack and employees are being hired that are not cultural fits, you can kiss employee retention good-bye.
Prioritize retaining linchpin employees.
The second step to resolving employee retention issues is to retain employees who outperform the rest and are integral in key business processes. Make sure to also take into account the quality of their relationships both internally and externally.
According to the Pareto principle, also known as the famous 80/20 rule, there are assets in this world that are disproportionately responsible for the lion’s share of outcomes. Applying this principle to organizational behavior suggests that 80% of the results are attributable to only 20% of the employees. Therefore, these are the employees that an organization should most want to retain.
However, although the prioritization of these key employees is necessary, that does not mean a company should fail to consider the needs of others adequately. According to the Harvard Business Review, companies wishing to best address roadblocks to retaining employees should look into cognitive technology that tracks sentiment, also called “sentiment analysis.” This tool reads employee comments that are posted online and can let management swiftly understand gripes, which gives managers the opportunity to address issues and let employees feel appreciated.
Repeat until satisfied.
A third way to mitigating unwanted employee attrition is to repeat best practices until the company is satisfied with its level of retention. While it seems like a fundamental business principle, so often, organizations do not focus on retention until attrition becomes an issue. This step may be overlooked in favor of the other two steps, but the process of iterating is telling and is the hallmark of a disciplined, well-run organization.
Take Satya Nadella, Microsoft’s Chief Executive Officer, for example. When he inherited Microsoft from his predecessor, he realized the company would be unable to transform its business without first improving its culture. Through office renovations and encouragement from many others in the chain of command, Nadella was able to create an organization whose values, such as promoting trust, were fully aligned with its corporate actions. Accordingly, Microsoft’s market capitalization passed the historic $2 trillion in market value, which is only second to Apple.
In an age where employee tenure appears to be dropping and loyalty shifting, going back to the basics can go a long way. Ensuring you hire for cultural fits, working hard to retain the top-performing employees and continually focusing on retention, even when it does not seem to be a pressing issue, can all help in your pursuit of solving employee retention problems.