EMPLOYEE RETENTION STRATEGIES
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INTRODUCTION
“Talented men leave. Dead wood doesn't”.
Philosophically, employee retention is important; in almost all cases, it is senseless to allow good people to leave your organization. When they leave, they take with them intellectual property, relationships, investments (in both time and money), an occasional employee or two, and a chunk of your future. Employee Retention Strategies helps organizations provide effective employee communication to improve commitment and enhance workforce support for key corporate initiatives. We also provide full support for your marketing-communication efforts by helping you build customer loyalty by distinguishing and positioning your organization’s unique products and services in today’s crowded marketplace
EMPLOYEE RETENTION
Employee retention is a process in which the employees are encouraged to remain with the organization for the maximum period of time or until the completion of the project. Employee retention is beneficial for the organization as well as the employee. Employees today are different. They are not the ones who don’t have good opportunities in hand. As soon as they feel dissatisfied with the current employer or the job, they switch over to the next job. It is the responsibility of the employer to retain their best employees. If they don’t, they would be left with no good employees. A good employer should know how to attract and retain its employees. Most employees feel that they are worth more than they are actually paid. There is a natural disparity between what people think they should be paid and what organizations spend in compensation. When the difference becomes too great and another opportunity occurs, turnover can result. Pay is defined as the wages, salary or compensation given to an employee in exchange for services the employee performs for the organization. Pay is more than "dollars and cents;" it also acknowledges the worth and value of the human contribution. What people are paid has been shown to have a clear, reliable impact on turnover in numerous studies .Employees comprise the most vital assets of the company. In a work place where employees are not able to use their full potential and not heard and valued, they are likely to leave because of stress and frustration. In a transparent environment while employees get a sense of achievement and belongingness from a healthy work environment, the company is benefited with a stronger, reliable work-force harboring bright new ideas for its growth Money.
WAYS TO RETAIN YOUR EMPLOYEE
Retaining key personnel is critical to long term success of an organization. A Retention Strategy has become essential if your organization is to be productive over time and can become an important part of your hiring strategy by attracting the best candidates who know of your track record for caring for employees. In fact, some companies do not have to recruit because they receive so many qualified unsolicited submissions due to their history of excellence in employee retention.
NEED AND SCOPE
Employers have a need to keep employees from leaving and going to work for other companies. This is true because of the great costs associated with hiring and retraining new employees. The best way to retain employees is by providing them with job satisfaction and opportunities for advancement in their careers. It’s not only the cost incurred by a company that emphasizes the need of retaining employees but also the need to retain talented employees from getting poached.
RESEARCH METHODOLOGY
The research design indicates the type of research methodology under taken to collect the information for the study. The researcher used both descriptive and analytical type of research design for his research study. The main objective of using descriptive research is to describe the state of affairs as it exits at present. It mainly involves surveys and fact finding enquiries of different kinds. The researcher used descriptive research to discover the characteristics of customers. Descriptive research also includes demography characteristic of consumer who use the product. The researcher also used analytical research design to analyze the existing facts from the data collected from the customer.
Increasing Turnover Rates
Employee turnover rates have, within the last several years, become a nationwide epidemic. Employees no longer feel the sense of company loyalty that once existed. Increasing numbers of corporate mergers and acquisitions have left employees feeling detached from the companies that they serve and haunted by concerns of overall job security. As a result, workers are now making strategic career moves to ensure employment that meets their need for security.
This fact is clearly represented by growing employee turnover rates. In a recent article, the Employment Policy Foundation (EPF) (2004) highlights that “for the twelve months ending August 2004, average employee turnover costs reached $13, 355, up 6.8 percent from its December 2002 level” (p. 2). The voluntary employee turnover rates released by the U. S. Department of Labor in November, 2004 paint a similar picture.
According to the Bureau of Labor Statistics, there was an overall average increase in employee turnover in the U. S. from 19.2% in 2003 to 20.2% in 2004. Weinberg (1997) reports that “too many service companies face employee turnover rates of 50 percent to 100 percent per year or even higher” (p. 4).
Employee Turnover is Expensive
In addition to elevated employee turnover rates being a frustration for employers, they can become a financial concern as well. The EPF believes average turnover costs to be 25 percent of an employee’s annual salary (2004). Other studies have proposed that the cost of replacing lost talent is even higher, as much as 70 to 200 percent of that employee’s annual salary (Kaye, 2000). Expanding on these thoughts, the EPF (2004) stated that “for a firm with 40,000 full-time employees, the difference between a 15-percent turnover rate and a 25-percent turnover rate is over $50 million annually.