The benefits of employee retention have always been apparent, but never more so than in the current day. The modern workforce is far more reflective about the kind of work they want to do, which has flipped the script on the employer-worker relationship. This dynamic shines a spotlight on the companies that have mastered the best employee retention strategies and are now reaping the benefits of employee retention.
In this article, we’re going to explore how employee retention can improve your business by looking at the positive outcomes of it. Our 12 benefits will answer the question “what is employee retention?” through in-context examples and make a clear argument for the value of a solid, cohesive team.
So whether you’re struggling with high turnover or need some solid arguments to invest in employee retention, read on to see how the benefits of employee retention can play into your organization’s success.
Hiring and training new staff is a significant expense for many companies, with advertising, interviewing, screening, and onboarding to account for. But aside from the costs you factor into your budget, there is also the issue of lost revenue and lost clients during the transition phase. By capitalizing on employee retention strategies, you can cut out these wasted expenses and tighten up your budget.
Clearly, training is an inevitable cost for any ambitious company. But while existing employees will need a boost in skills every now and then, it’s far more cost-effective to enhance existing knowledge than to start from square one.
A boost in sustainable productivity overlaps somewhat with reduced costs in hiring and training. No matter how talented a fresh face is, they will always take time to get up to speed in their new environment. This learning curve can take up to half a year, depending on the complexity of the role, which is all time when your productivity is reduced. By avoiding this learning curve, you can maintain predictable performance metrics over longer periods of time.
But where there is a drop in productivity with one new hire, there is a constantly interrupted flow in companies with high turnover. Aside from the lack of productivity during the training phase, there are also fewer senior staff who can pass on their knowledge and experience.
The benefits of employee retention for productivity are clear. Your whole team is more familiar with what their tasks are, the right colleagues to ask for help, and the workflows they’re dealing with. A solid team of employees, therefore, leads to more efficient work and ultimately higher revenue.
Effective employee retention strategies lay the groundwork for a stronger emotional connection with your company. When employees feel a part of your business and celebrate its success, they have a greater level of motivation to contribute. However, you can’t magically earn this engagement on day one. To turn employees into ambassadors, they need time to fully integrate with the business and to build that connection.
From time to time, you will of course have to hire new recruits. If these new recruits join a united, highly motivated team, that feeling will rub off and continue the cycle. Similarly, as you look to expand, word can get out about your engaged working environment which gives you the edge when looking for the best talent.
To get a team to speak the same language, understand how others work, and collaborate seamlessly, there is no replacement for time spent together. One of the benefits of employee retention is that it gives you time as a group, rather than the fractured interactions of high turnover.
But to really turbocharge your teamwork, building social connections is paramount. To achieve a cohesive team, one of the best employee retention strategies is to introduce team-building activities that break down those social barriers. With each event, you create new anecdotes, strengthen the bonds between people, and promote an environment where people have each other’s back.
Of course, fostering an environment like this is only possible with long-term team members who know each other on a deep level — and that’s where employee retention comes in.
In constantly changing teams, strategies are introduced and abandoned at a rapid rate. This lack of clarity and vision stifles productivity and teamwork because a large part of people’s energy is spent on getting to grips with the basics.
Stable processes and workflows are consequently among the leading benefits of employee retention. When you have an experienced team that knows the nuances, processes, and expectations of their work, they can fully focus on their specialty, rather than being blocked at the admin stage.
Most efficient companies nowadays use a combination of workflows and automations that set structural elements to autopilot. While there is always a learning curve involved with these workflows, if you stick to a system that works, you’ll gradually have a team that runs like a well-oiled machine.
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When it comes to employee retention, it’s not just the human being you want to keep on your side. Every individual has a wider sphere of influence on your organization, which is clear to see through the institutional and strategic knowledge they have. This is especially true for the senior employees you’ve retained — those who have been there and done that 50 times before.
Sure, you can store all of these best practices in a shared knowledge bank that anyone can access with a simple search. But the instinctive understanding that comes with experience is the key to finding immediate solutions. In a similar vein, employees that have spent many years at an organization have often worked across multiple departments. This gives them a broader knowledge of the company and allows them to spot connections across the company as second nature.
Just as the benefits of employee retention include preserving knowledge from the past, it also helps build fresh knowledge looking forward. The stalwarts of your company get such a good understanding of how things work that they have the headspace to create synergies between two seemingly isolated concepts. To take a simple example, an experienced sales representative of a clothing brand may be so familiar with the product that they could suggest accessories their clients are using.
Employees that have been with you a long time feel comfortable enough in their position that they can consider the wider possibilities of what they can achieve. Rather than spending mental energy on understanding their primary tasks, they can take a bird’s-eye view of their job and identify ways to optimize your business.
High turnover rates are essentially the opposite of employee retention, but here we’re going to look at exactly what makes them so bad for your organization. Aside from the increased costs and disruption of your workplace, high turnover can lead to frustration and demotivation among your employees. Every change in personnel is like pressing the restart button on your progress. This results in a confusing mix of reassigned tasks, extra responsibility, and dissatisfaction with management.
Therefore, your employee retention strategies should focus on creating a culture that people don’t want to leave. This involves implementing stability and consistency in your working environment, but also offering fair pay and conditions and a route to growth. As you enhance and improve your approach, your low turnover rates will provide a predictable platform that allows you to get the most out of your employees.
For your team, one of the benefits of employee retention is the psychological safety of knowing they aren’t in a hire-and-fire environment. When employees feel stressed and anxious about job security, they can’t work at their best and are reluctant to suggest new ideas for fear of repercussions. However, employee retention is a clear sign of a leader who supports their team, and that helps to develop a positive work culture that encourages new ways of thinking.
Although a positive work culture takes more input than simply high retention, the benefits are even more far-reaching. Team members feel in-sync with one another, meaning fewer misunderstandings, more efficient communication, and a collaborative mindset. But the most important benefit of a positive work culture is that people wake up in the morning excited to go to work, which is a huge contributor to good mental health.
Experience and decision-making go hand-in-hand, making improved decision-making one of the key benefits of employee retention. Your long-term staff gradually pick up a comprehensive understanding of how your company should react in a given situation, and know the strategies and processes that have been proven to work. Experienced team members can speed up the early decision-making processes by discarding ideas that are impossible or that have failed in the past, and help to keep projects in line with company goals.
Yes, it is fair to say that major breakthroughs require fresh perspectives, but those perspectives don’t need to come from a fresh set of employees. As a manager, you can revitalize your team with innovative workshops and pressure-free “play” sessions.
With remote working options opening companies up to potential candidates all over the world, employer branding has emerged as a priority for HR departments. Applicants can get easy access to employer reviews, making it hard to hide your faults, but easy to show off your plus points too.
While employee retention strategies are often aimed specifically at avoiding new hires, expansion projects demand that you go on a recruitment campaign. When those moments come, you are essentially up against your competitors to fight for the best candidate’s signature. Here is where the benefits of employee retention move from internal productivity to external appeal. High employee retention suggests to candidates that you have created a positive work environment and you offer a tangible career path through your company.
One of the greatest benefits of employee retention lies in customer satisfaction — a concept that spans a variety of areas.
Starting off with the human connection, what B2B clients want most is a seamless relationship with their account manager. This is often an advantage for small businesses that can use a personal, trusting connection to compete with more corporate brands. At the same time, you can track customer behavior and draw out insights through customer relationship management systems, but ultimately, there is no replacement for that human connection.
Your senior workers are ideal for B2C clients too. With years of experience, they will have an immediate answer to any query and a deep understanding of what your business can offer. This injects a sense of confidence and competence into every interaction, from sales to customer service.
Now you understand the concept of employee retention and why it is important. But just to finish, we’ll look at one last aspect that helps you enact your new strategies.
Creating an environment that promotes high employee retention requires a lot of work behind the scenes. From creating stable workflows and sharing knowledge in the cloud to structuring compensation packages and organizing team-building events, there’s a lot to keep in mind.
But with Bitrix24, you can save yourself the headache.
With a vast array of interconnected business tools, Bitrix24 is your online organization hub to improve your employee retention rates.
Employee retention refers to the strategies and practices used to reduce turnover by building a stronger more sustainable team. Employee retention is currently a target for high-turnover companies that see a drop in productivity and revenue with every change in personnel.
The main way to increase employee retention is to create loyalty by adding value to the working experience. Loyalty is a two-way street, so paying above-market rates, offering practical perks packages, and being flexible about working hours is a great place to start.