Improving employee retention can be among the most challenging tasks for a small business. Your managers can play a crucial role in these efforts, since one of the most important relationships that define a worker’s day-to-day experience is the interaction between managers and employees.
Why is retention so important?
The financial impact associated with employee turnover can be burdensome to a business. There are “hard” costs such as posting the position to online job boards, hiring a recruiting firm, interviewing time, and maybe even offering a cash incentive to staff when hiring a referral. But “soft” costs to fill openings can be just as or more expensive, including:
- Reduced productivity– Existing staff is stretched to cover the vacant position or no one is available to fill the job, so less work may be accomplished.
- Overworked remaining staff– Those who remain have their own jobs to do, as well as the duties of the vacant position, possibly hurting morale and risking further turnover.
- Lost organizational knowledge –Departing employees take their know-how out the door: job-specific procedures, information, contact relationships, etc.
- Training expenses– These can be obvious, such as sending the new hire to outside seminars or workshops. But staff time spent orienting and training new personnel can affect your bottom line as well.
“Soft costs” associated with employee turnover:
– Reduced productivity
– Overworked remaining staff
– Lost organizational knowledge
– Training expenses
Why managers are integral to retention…
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How You Can Support Employees Today for Ongoing Top Performance Tomorrow