An introduction to keeping your best members of staff
Every company has a handful of employees that are irreplaceable. You might value their creative mindset or impeccable sales record or perhaps they have a way of motivating everyone around them.
Retaining these members of staff is essential for the health and success of your business – yet it’s harder than ever to hold on to this kind of talent.
Younger workers are changing jobs more than ever – 21 per cent of millennials have changed jobs in the past year – and passive recruiting can snap up staff before they’ve even started job hunting.
Failing to retain a key member of staff can lead to major issues across your workforce, like job insecurity, excess work and a lack of motivation. It will also have a significant impact on your bottom line.
Gallup estimates the replacement cost of a top employee can be up to two times their annual salary. Recruitment can be expensive, particularly if you need a sought-after skill; there’s agency costs, advertising costs and HR time.
But the greatest cost is the loss of productivity. Even if you make a new hire of the same high standard, you’ll lose thousands of pounds in productivity because of the time it takes them to get up to speed.
It’s crucial that you’re doing all you can to retain your best members of staff. This guide looks at some of the common mistakes companies make with employee retention and the quick wins that will make a difference now. The next step will be to use our dedicated Action Plan to direct your change and improvement.
What factors affect your ability to keep talented staff?
An increase in highly skilled freelancers
Growth in self-employment is largely due to a rise in highly skilled workers opting to go freelance. There are now around two million highly skilled freelancers working in the UK, an increase of 46 per cent since 2008.
People choose to go freelance for a variety of reasons, but greater flexibility and work-life balance are frequently cited. It’s a tempting option for talented staff and one with potentially lucrative returns.
Companies that want to retain employees should take note of this growing desire for workplace flexibility. Refusing a request for flexi-time or remote working options could lead highly skilled staff to consider other options.
A competitive job market
One of the biggest challenges for employers is that there’s not enough supply to meet demand when it comes to top-tier talent.
It’s not just about having a competitive pay package. Your company’s culture, values and purpose can be deciding factors when candidates are choosing where to work.
Job seekers know what other businesses in the market are offering – and, chances are, your staff know it too.
Keeping an eye on what people are looking for will make sure you continue to offer the right benefits to retain those important staff members.
Managers need to keep their best employees engaged in their future with the business. A big part of this is making them feel like they have the potential to progress, so it’s important to develop career paths for your employees.
“The key to retaining employees is to create a workplace in which everyone is treated and rewarded fairly and feels supported and valued. Every colleague must be seen as an individual and not as a resource. After all, if you regard people as mere commodities and treat them as such, it shouldn't be a surprise if they up and leave for a competitor that respects them for who they are and what they can personally bring to the business.”
Donald Moore, chair of Rowlinson Knitwear
The cold hard facts
While managers often tie employee turnover with higher salary offerings elsewhere, Perkbox found that just 20 per cent of employees label “salary” as the biggest contributor to loyalty. Other engagement drivers include career opportunities, the company’s reputation and recognition.
Common mistakes made when trying to retain talent
You don’t think they need training
A common mistake is assuming your best employees don’t need training because they’re already good at what they do. They’re hitting their numbers and seem happy with their job, so your budget is better spent on staff who are struggling – right?
Providing training and development opportunities is essential for retaining talent. Your staff might already be highly skilled, but they can fall behind if they aren’t given the chance to hone their expertise. Worse, they could become bored or despondent in their roles.
Training is also vital if you want to keep your best staff engaged. People need to feel like they’re a valued part of the team – championing their personal development shows that you’re invested in their future.
There’s too much pressure
High-quality employees tend to be highly sought after across the business. They might be asked to give their input at department meetings, mentor junior staff or help solve issues.
While top performers can positively influence the business as a whole, it’s vital that managers check they aren’t being stretched too thin.
Be wary of piling too much pressure on or giving them too many responsibilities – it can lead to stress and you risk losing your employee if they start to feel overwhelmed.
You don’t know who your best staff are
Your best members of staff won’t always be the ones who work fastest or bring in the most money. They might be under the radar and, as a result, you don’t realise how much they contribute.
It’s crucial not to judge staff by metrics alone. Pay attention to how each employee contributes to the business, whether it’s motivating the people around them or expertly handling difficult customers. You’ll miss them when they’re gone.
“We found that educating our sales teams on our manufacturing process leads to higher employee satisfaction and staff retention. When our best people have a true understanding of the work that goes into creating one kilt or piece of clothing, they really buy into the brand on a much deeper level than somebody simply selling a product with no knowledge about how it was made.”
John Kinloch Anderson, CEO of Kinloch Anderson
The cold hard facts
Gallup recommends tracking the percentage of excellent hires that leave before the end of their first year. If a large percentage of high-quality employees are moving on in that time, you could have a problem with your culture.
Companies that find themselves in this situation should learn from exit interviews with these employees and feedback from other high performers to identify what areas of the business they need to work on.
Quick wins for keeping your best members of staff
Show staff they’re appreciated
It’s easy to take people for granted when they’re consistently high performing. But showing employees they’re appreciated is essential if you want them to feel like they’re a valued member of the business.
Recognition might be done through a formal system like an award, year-end bonus or promotion. However, managers should also get into the habit of providing more regular, informal recognition.
This might include:
- Highlighting great work in your weekly meetings
- Taking an employee out for lunch
- Sending a quick email to an employee to explain how much you’ve appreciated their work recently
Ask your employee what the business can offer
Don’t make assumptions about what your best employees want from you – ask them and find out.
Career development prospects and mentoring are often attractive to talented staff, but people’s interests and priorities change. Your employee might have been interested in a high pressure role a year ago, but now values work-life balance because of new family commitments.
It’s up to managers to make sure they’re regularly meeting with employees and finding out how the company can support their needs.
Look after employee wellbeing
Top employees may be asked to contribute to projects outside their remit. It can be hard to say no, particularly if they’ve been approached by a senior member of staff.
It’s crucial to monitor employees’ workloads to protect against burnout. Feeling like too much rests on your shoulders is a fast track way to exhaustion and disenchantment – meaning your employee is likely to start looking for work elsewhere.
Managers should check in with staff about their workload on a weekly basis, make sure they’re not working in the evenings and encourage them to use their holiday allowance.
“Retaining high performers can be a challenge. From my experience, businesses can get it wrong by making assumptions. In order to retain high performers, it’s key to understand what motivates them. This can then be paired with the assignment of an effective mentor and a culture of trust and transparency.”
Charlotte Harding, chief people officer at Trident Worldwide
The cold hard facts
Providing recognition has a wealth of benefits for businesses, making staff happier, more productive and more trustful of colleagues and managers.
The Society for Human Resource Management tied recognition to better workplace results. Knowing work is valued makes people want to contribute more – 79 per cent of employees said recognition makes them work harder and 78 per cent that it makes them more productive.
Now you’ve learnt about the underlying factors that can affect retention of your best staff, use our Action Plan to direct your improvement efforts.