by Sophia Young, owner of Content Studio and HRHQ contributor
It’s never a secret that you want high-value talent to stay in your business. Job satisfaction is vital for employees but that’s only a small part of employee retention. Keeping talent helps your business grow and improve productivity.
Despite the disastrous effects of high turnover rates, many companies forget how vital employee retention is to your success. Here’s how a higher retention rate impacts employee performance and why it should be one of your priorities.
What Is Employee Retention?
Retention is a measure of how long an employee stays with your company. An employee’s experience is a broader term that includes a person’s emotions, thoughts, and feelings while working at your company.
Employee experience encompasses much more than salary. It covers everything that makes an employee stay or leave your company, including company culture, politics, workload, and environment.
Whether an experience is good or bad could influence an employee to leave or stay in your company. In the business world, these two things always go hand in hand. The more people leave your company every year, the higher your turnover rate. Similarly, managing your employees effectively confers more benefits for you.
Why You Want High Retention Rates In Your Company
If your retention rate is high, you are doing something right. But does that mean you should simply keep up the status quo? No. You want to ensure that your company’s retention rate continues to rise. This, in turn, ensures that your employee experience stays positive.
To understand the value of high retention rates, you need to imagine that your company is struggling. You’re losing employees left and right, but you still need people to work. The problem is, you’re unable to find qualified people.
You’ll struggle to find qualified candidates no matter how good your marketing campaigns are. You’ll have no choice but to hire people who don’t have the skills you need. Moreover, they’ll be slow at learning the things you need them to do. Your retention rate will plummet, and your employee experience will suffer.
A high retention rate also keeps employee turnover from getting in the way of business. Imagine that you hired ten people. Now, you need to fire nine of them. This not only hurts your company’s productivity, but it also hurts your employee experience. Hiring someone new, training them, and getting them up to speed takes time.
Good Retention Improves Company Culture
Retaining employees means keeping their morale high. When you lose valuable employees, you lose your productivity, culture, and profit margin. Every employee brings a different set of skills to the table, which you need to constantly remind yourself of.
The experiences your employees have while working at your company shape who they are. Good experiences leave employees feeling motivated, productive, and happy. Bad experiences, on the other hand, leave them feeling demotivated and unsatisfied.
Retaining employees helps you build a more robust company culture. Company culture combines several aspects of your business. These include:
- Positive management skills
- The knowledge they made in your business
- The bonds and networks they provide
- The internal organizational skills every veteran employee brings to the table
These make high retention rates worth it. Your employees will have a positive outlook on the company. They will believe in your actions and encourage you to continue improving.
Experienced Employees Mean Better Productivity
Employee experience comes from a combination of the work they are doing and their interactions with other people. Experienced employees tend to produce better work, improving your company’s productivity.
Experience also influences how employees interact with one another. Experienced employees know how to deal with complex issues because they’ve already seen and dealt with them. They know how to prioritise work, and they know how to match their workload to their capabilities.
Experience also makes employees more knowledgeable about their industry. They understand your products’ ins and outs and know how to provide excellent customer service. If you’re a face-to-face business, customers are more motivated to do business with you if they are familiar with your employees.
Good Retention Means Keeping Company Knowledge
Experienced employees know the ins and outs of your company’s systems. They know more about the business’ goals, processes, and how to get things done.
They are more familiar with the company’s culture and know-how to get things done, but most importantly, experienced employees understand how the organisation works. This helps you retain this knowledge and avoid starting from scratch when talented employees leave.
If an employee leaves, your company loses all that knowledge. Experience only stays with employees. Every employee brings something unique to the table, and these traits are what sets them apart. These traits end up defining your company’s culture.
Experienced Employees Are More Motivated
Retaining employees means keeping them motivated. Experienced employees tend to be more motivated because they’ve already seen what’s possible with your business. They’ve seen how much they’ve accomplished and know how they can improve.
Experienced employees also tend to be more satisfied. They know how to do their job well, and they feel accomplished. They know they’re capable of achieving their goals, which allows them to be happier and more motivated.
Better retention means you keep people understanding your company’s goals and mission. They understand how they play a role in achieving those goals and know they play a critical role in your company’s success.
Good Retention Improves Customer Service
Retaining employees makes your company more approachable. The more employees you have, the harder it is to maintain good customer service. Good customer service makes your business more approachable and builds your reputation.
Long-term employees know how to build good customer relationships. They know how to talk to customers, and they know how to explain your products and services. They’re also familiar with your company’s culture, making them more approachable.
Seasoned vets also know how to prioritize customer service. They know how to attend to the needs of their customer while still doing their work. They understand how valuable their time is and aren’t afraid to use it to provide good customer service.
The Bottom Line
Retaining employees helps your company stay afloat. It builds a stronger team, improves productivity, and enables you to build a positive culture. Good retention also ensures that your business keeps its knowledge intact.
Retention rates depend on an entire suite of factors, which are constantly changing. You need to keep learning, and you also need to keep doing all you can to offer people the experiences they need.
About the author
Sophia Young recently quit a non-writing job to finally be able to tell stories and paint the world through her words. She can also easily kick ass with a thousand-word article about the latest marketing and business trends, finance-related topics, and can probably even whip up a nice heart-warming article about family life. Sophia also loves talking about fashion, weddings and travel
