In an era marked by the Great Resignation and continued employee unrest, talent retention is top-of-mind for employers across all industries and geographies. In truth, talent retention should always be a concern. Turnover is costly in any economy.
Today, though, the ability to attract and retain top talent provides a competitive advantage that is particularly powerful—not just to gain and keep market share, but to gain and keep employees as well.
Why is talent retention important?
Talent retention is important because attracting and retaining talent is costly and because losing that talent is also costly—especially when employees leave to work for competitive organizations.
To reap these benefits, employee retention requires companies to keep (desired) employees on board by ensuring they’re engaged and satisfied with their work, the corporate culture, and the relationships they have with colleagues and managers.
Who is responsible for talent retention? Everyone! That’s why it’s critical to have a well formulated talent retention strategy in place to ensure that the organization, its leaders, HR staff, managers and others are all working together to ensure that the environment and workplace practices are designed to support an engaged and loyal workforce.
What are talent retention strategies?
Talent retention strategies are the plans that organizations develop to help keep top talent on board. Because no two organizations are the same, no two retention strategies will be the same.
Your company’s strategies will be based on your workforce, your workplace culture, roles, expectations, management practices, and a wide range of other factors that impact employees’ decisions to continue to work with you.
Importantly, these strategies will change over time as the environment and impacts on employees change. The COVID-19 pandemic is a striking example of that. Since March 2020 employee needs and preferences have changed significantly with many demanding more freedom and flexibility in work schedules and where they work as they’ve gotten a feel for the benefits of remote and hybrid work.
According to a report from the ADP Research Institute, 67% of workers say they feel more empowered to take advantage of flexible working arrangements at their companies, compared to only 26% before the pandemic. This puts pressure on employers to ramp up their tactics to ensure employee retention.
5 Steps for improving talent retention
The steps to improving talent retention at your organization will likely be unique from other companies. Every company is a little different, and the reasons that employees stay at your organization will vary.
In general, though, there are five key steps for improving talent retention. Let’s dive into each.
1. Understand the demographic variance in your workforce retention risks
Employee retention is complex and requires more than just cursory consideration of what the drivers of turnover “might” be. Today organizations are fortunate to have data and predictive HR analytics tools on hand to help them critically evaluate what’s really causing employees to leave. Not all organizations take advantage of the power of that data, though.
People leave organizations for varied and complex reasons. The pandemic has added to those reasons, with many employees finding that they’re struggling to balance work/life pressures, especially when working for companies that are rigid in their workplace and hour requirements.
Too often companies simply don’t know what to do or which employee segments are most at risk.
Establishing dedicated resources and teams to understand the current state, surface root causes behind turnover and identify areas of risk can help to create action plans that can generate real results.
Results will vary, of course, based on workforce demographics (like age, length of service, role, department, etc.). Once you have a sense of your workforce demographics, and which segments may be at risk of turnover, you can identify where to place your focus on retention from a strategic perspective.
2. Identify key areas of opportunity
Once you’ve analyzed your HR data, you’ll be able to make an informed and objective decision about what to do next. Based on your analysis, where are you most at risk for losing top talent?
- Do you have a high percentage of pending retirements among key employees?
- Is dissatisfaction in one department higher than in other departments?
- Has turnover increased among certain segments of your workforce?
- Are employees reporting that a lack of promotion opportunities is causing them to seek employment elsewhere?
Reviewing your data to identify variations in retention, satisfaction, engagement and other metrics can help you prioritize where you need to focus your efforts to stem the tide of turnover, especially in critical areas.
Be bold in your approach. Using the same approaches as other companies doesn’t set you apart—it makes you the same as. Attracting—and retaining—top talent requires bold moves. For instance, to combat other companies’ announcements to offer unlimited vacations and higher wages, the CEO of Boxed said that he would pay the college tuition for the children of his employees.
That’s a bold move!
3. Audit your talent acquisition and onboarding processes
If you don’t hire the right people—people with the appropriate knowledge, skills, and abilities (KSAs) to perform the work, as well as the right expectations and values that align with your corporate culture—your risk of attrition will grow.
In addition, if your onboarding process doesn’t quickly and clearly support your new hires’ decision to join your organization and make them feel that they are welcomed and have a sense of belonging to support their decision, turnover may be the result.
Taking a critical look at your talent acquisition and onboarding processes can help you identify gaps and areas of opportunity for improvement. Including a look at data that can tell you whether certain sources of candidates, for instance, may be more likely to leave within a year of service. Looking at these, and other, key metrics can help you to drill down into drivers of turnover that can be addressed through talent acquisition and onboarding process changes.
4. Ensure that supervisors and managers are trained to serve their employees
Employees’ direct managers and supervisors have a marked impact on their level of satisfaction with their jobs—and the organizations they work for. That makes sense. Managers and supervisors have direct control over the employee experience. They assign work. They provide feedback. They evaluate performance.
If managers and supervisors are not adept at these critical interactions with employees, satisfaction will suffer.
SHRM indicates that there are “8 Things Managers Do That Make Employees Quit.” These include:
- Setting inconsistent goals or expectations.
- Having too many process constraints.
- Wasting employee resources—time (e.g., requiring too many meetings).
- Putting people in the wrong roles.
- Assigning boring or overly easy tasks.
- Failing to create a psychologically safe culture.
- Creating a work environment that is too safe (employees need a certain level of pressure to perform well).
- Leading with bias.
These are all issues that can be addressed through awareness and training. Managers and supervisors need to be well prepared to serve in their roles to help positively impact the employee experience—and boost talent retention.
5. Monitor employee sentiment and people analytics to stay on top of trends
Improving talent retention isn’t an event, it’s a process. There will not be a point in time when you have “solved” the talent retention problem. You will need to continually monitor and evaluate your situation to identify areas of both potential risks and best practices.
Using data and people analytics to stay on top of retention risks in your organization, having a strong retention strategy, and ensuring that everyone in your organization is working together to create a supportive, inclusive, and engaging workplace.
Take steps to understand how using people analytics can help you strategically address the drivers of turnover to improve your focus on talent retention.
Talent retention FAQ
Why is talent retention important?
Talent retention is important because it ensures organizations are able to support and retain productive employees, thereby ensuring organization growth and a positive company culture. Employee attrition is a costly problem for companies, and can negatively impact the productivity and morale of remaining employees.
What are talent retention strategies?
Talent retention strategies are the plans and actions that companies deploy to retain productive employees over the long term. These include strategies to improve company culture, management, compensation, development, and any other area that is important to the organization’s talent pool.
What are steps to improve talent retention?
Steps that organizations can take to improve talent retention include:
- Analyzing HR data understand what is driving attrition and retention
- Understanding the demographic factors in workplace retention
- Identifying areas of opportunity and improvement
- Auditing and improving their talent acquisition and recruitment processes
- Ensuring that managers are trained to serve their employees
- Monitoring employee sentiment and people analytics to stay on top of trends
About the author: Visier Team
People-centered ideas and insights by the editorial team at Visier.
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