Even as The Great Resignation recedes in the rearview mirror, companies continue to struggle to retain top talent.
According to research from the HR group Gartner, employee turnover rates are slated to be 50%–75% higher than anything companies have endured previously. That can be costly not just because of the expense involved in recruiting and training new hires but also because of the indirect expense of lost productivity and diminished morale.
Controllers and CFOs can play a role in improving employee retention rates. The following are some of the current best practices for boosting employee engagement and retaining your top talent.
Transparent Communication
Communication between management and employees can boost employee engagement, which can prevent workers from jumping ship in the hopes of a better job elsewhere.
Managers should work toward communicating the company or department’s goals so employees feel like they’re part of the bigger picture. At the same time, company leaders should seek opportunities to listen to their employees to ensure that they feel heard and valued.
Case Study: The Power of a Stay Interview
The Texas Association of School Boards (TASB) understands that employee retention demands two-way communication. While employee engagement surveys aren’t uncommon in corporate America, TASB implements “stay interviews,” where they directly interview staff members to assess their overall satisfaction and expectations.
Competitive Compensation
No matter how great your workplace culture is, employees are unlikely to remain if they can find higher pay at another company.
Increasing salaries can help you retain workers, especially if you give pay increases based on tenure. Sure, this adds to your operational costs, but so do the costs of high turnover. Competitive salaries may actually be cheaper in the long run since you’re keeping your workers engaged.
Case Study: Scheduled Raises Boost Engagement
Alexandria Carter is a billing specialist and accountant for a Baltimore-based insurance company. Her employer has rewarded her work with small pay increases, and her managers have expressed their desire to see her continue to climb the company ladder.
This was a welcome change for Carter, who appreciates the recognition and feels “rewarded” by her employers.
Evolving Benefits
Higher pay isn’t the only way to increase employee satisfaction. Many companies are evolving their benefits program to include things like:
- Confidential mental health programs
- Employee wellness programs
- Community service events
- Childcare opportunities
As an added benefit, some of these programs (such as community service events) can also double as team-building activities to strengthen employee connections, an increasing need in today’s hybrid workforce.
Case Study: The Benefits of Wellness Programs
In 2001, a cancer center augmented its health and well-being department with additional workers’ compensation and injury care programs. By 2007, lost work days had dropped by 80%, while insurance premiums decreased by 50%.
Professional Development Opportunities
Workers will invest in companies that invest in them. For instance, employees may remain loyal to a company that offers professional development opportunities they can’t get elsewhere, or that would cost them money otherwise.
Case Study: LinkedIn’s “InDays”
LinkedIn has made professional development a major focus for years, even integrating it into their onboarding process. The company offers “InDays,” during which employees are given the opportunity to “explore themselves, the company, and the world.”
According to a 2018 LinkedIn survey, 94% of workers would be more willing to remain at a company that invests in its workers.
A Positive Workplace Culture
According to a study conducted by MIT, a “toxic” company culture makes roughly 10 times the contribution to employee turnover as compensation.
Creating an environment of mutual respect and positivity can improve retention rates. In other words, companies need to work hard to create work environments in which employees want to participate.
Case Study: “Work Made Fun Gets Done”
Bob Nelson and Felix Mario Tamayo analyzed data from the list of 100 Greatest Companies to Work For, published by Fortune.
Their analysis, published in the book “Work Made Fun Gets Done,” reveals that 81% of employees at these companies described their workplace as “fun.” Outside this list, only 62% of employees did the same.
There’s a strong correlation between a positive and enjoyable workplace and a company’s overall success.
Healthy Work-Life Balance
The 2020 pandemic gave America a taste for the work-from-home life. Now that business is (mostly) back to normal, many workers miss the relative freedom that came with working from their kitchen or living room, especially those with families.
Making allowances for hybrid or flexible work schedules can go a long way toward improving work-life balance, but so can your sensitivity to holidays and time off.
Case Study: Nike’s Hybrid Culture
Nike experienced some initial pushback when asking its workers to return to work in December 2021. Not only had there been a recent spike in COVID-19 cases, but 46% of the company’s workers lacked confidence that the in-office plan would provide sufficient flexibility.
Consequently, starting in May 2022, Nike has operated with a 3/2 hybrid approach, asking employees to come to the office three days out of the week and work from home the remaining two.
Not Mutually Exclusive
These strategies are not mutually exclusive. Companies can overlap these methods and reinforce their retention methods. In the end, organizations that adapt will experience less turnover and lower costs.
