When it comes to retention, HR leaders and their teams are always looking for ways to keep turnover rates down, especially for managers and key employees. Retention starts with onboarding and continues through the employee lifecycle. When we’re conducting research on how likely our workforce is to stay, it’s not always necessary to bring in a consultant or use engagement surveys. Improving retention can be as simple as setting up a few new programs that improve specific touchpoints in the employee lifecycle.
According to the Work Institute’s 2019 Retention Report, 41.4 million U.S. workers voluntarily left their jobs in 2018. Nationally, employee voluntary turnover exceeded 27% and turnover trends demonstrate an 8.3% increase over 2017 and 88% increase since 2010. If these trends continue, U.S. voluntary turnover will hit 35% by 2023, putting companies in continuous and enormous risk.
How to Improve Employee Retention and Reduce Turnover
Here, we’ll cover six easy ways to improve employee retention that you can implement and execute along with your leadership team to reduce turnover, whether your company is undergoing restructuring, reorganization, or just has a higher than average turnover rate.
1. Stay Interviews.
Exit interviews with employees on their last day of employment can garner helpful information to provide to managers and supervisors, which is something we absolutely need. But if we’re finding out about employee concerns or ideas for improvement as the employee has one foot out of our door, it’s too late to take action to prevent that employee from leaving. The best time to discover concerns or dissatisfaction is before the employee puts in notice, which is why many companies are now using stay interviews.
Stay interviews can give us more information than employee surveys because they are a two-way conversation in which we can ask questions or follow up on ideas. They allow us to discover how employees feel now, not how they felt last month or last year. If your company has a culture of transparency and trust, meetings with key employees and their managers (or train the managers on how to do them without HR) can be extremely effective in improving engagement, as you’re asking “what can we do better?” – not “why are you leaving?”
2. Skip Level Interviews.
These are one-on-one meetings between a senior leader and employee. The leader meeting with the employee is the boss of the employee’s supervisor. Senior leaders spend less time with employees and more on long term planning, growth and strategy, but skip level meetings allow them to have a deeper understanding of their direct report’s team members do to support high-level functions. These meetings don’t have to be formal or have a set agenda. They can also be done with small groups of three or four team members in a casual lunch setting. The goal of skip level meetings is to meet with employees, develop trust and create a rapport so he or she feels comfortable approaching senior leadership in the future with concerns that may lead them to resign.
3. Town Hall Meetings.
Also called all-hands meetings, these are organization-wide meetings during which leadership presents important information and employees have an opportunity to ask questions. Many companies have town hall meetings, but treat them as information sharing without dialogue. The factor that impacts engagement and retention, and the goal of town hall meetings, is to allow all employees to ask questions about the information and give their feedback. When setting up your agenda, half of the meeting time should be presentation and the other half dedicated to questions and answers. The benefit is that, when employees know what’s going on within their company at a business level, they are more engaged and have a higher level of satisfaction and trust. Technology allows us to include remote employees so that the entire workforce can hear the information first-hand and engage via video call.
4. Monitor Turnover by Manager and/or Location.
This is important to help you and your team identify trends in retention rate based on dissatisfaction with a specific manager or at a specific location. Isolating the data shows you where to direct your efforts to improve engagement and retention, like manager training and skip level interviews. It also gives your company leadership insight into what’s working and what isn’t. For example, one of your locations may have a lower turnover rate than the others by a significant percentage. Rather than sending an employee survey to locations with a high turnover rate to find out what’s wrong, consider sending surveys to employees at the location with low turnover to find out what’s right. Once you understand what they’re doing better, you can implement and scale these things at other locations.
5. Lunch and Learn Programs for Managers.
Lunch and learn meetings are great tools for employee development, and can also be a good resource to help managers learn how to directly impact their team’s retention rate. For example, if your company wants to begin holding stay interviews, you can hold a learning session for managers on best practices for conducting stay interviews, what to ask, what not to ask, and how to relay the information to HR or senior leadership. Other relevant topics are team building activities, design thinking challenges, mentoring and coaching, how to have difficult conversations with team members, how to offer positive and negative feedback, and so on. If you have data that shows that employees are leaving because they don’t feel challenged or they don’t think they have an opportunity to move up within the company, you can hold a learning session for managers on how to work with their team members career goals.
6. Offer Stay Bonuses.
Also called retention bonuses, stay bonuses are most popular with companies undergoing restructuring or reorganization due to a merger or acquisition. Offering a stay bonus to key employees and managers can provide them with the financial security to persuade them to stay during and after the transition, particularly if they are concerned that their future with the company may be in jeopardy. If your company is not undergoing transition but is losing employees at an alarming rate, it can be difficult to get executive buy-in for stay bonuses, especially if the company is in financial straits. However, because you’re doing due diligence through employee surveys, stay interviews and skip level interviews, the company’s financial situation could be a direct result of the high turnover and the cost of stay bonuses could improve the company’s bottom line.
Consider the cost of turnover: The Work Institute conservatively estimates that the cost to lose a U.S. worker is $15,000. Generalizing this cost to U.S. voluntary turnover in 2018, U.S. employers have lost $617 billion to employee turnover; $469 billion in turnover costs were controllable (76.8% of all turnover) if employers aligned interventions with retention requirements. Presented as profit/loss/recovery financial data to stakeholders, stay bonuses could save hundreds of thousands of dollars each year lost to retention. Having a retention strategy that is customized and a multi-faceted approach is your best defense to lowering employee turnover not just in a hot job market like this one but in any economic climate.