An HR Glossary for HR Terms
Glossary of Human Resources Management and Employee Benefit Terms
What Is a Retention Strategy?
While some turnover is inevitable, building a retention strategy to prevent as much voluntary turnover as possible can save an organization time and money. After all, it’s much easier and much less expensive to train and develop your current employees than it is to continually hire new people.
Benefits of an Effective Retention Strategy
The focus of a retention strategy is just as it sounds: retaining employees. However, an effective retention strategy is about more than just getting people to stick around your organization longer. Other positive outcomes include:
- Lower turnover
- Lower hiring costs
- Increased employee productivity
- Higher employee satisfaction
- Stronger work relationships
- Less work-related stress
- Less burnout
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Retention Strategy Elements
Improving an organization’s work environment as part of a retention strategy might mean creating more quiet spaces where employees can focus, opening up office space to encourage collaboration, or offering flexible work hours and work-from-home options.
A work environment should encourage employees to put in their best work and be a place where they can concentrate, collaborate, and feel welcomed. This should be true of both the physical environment for in-office employees and the digital environment (including collaboration platforms and hardware) for remote or hybrid employees.
Culture is what it feels like to work at your company. Do employees feel supported, empowered, and engaged? Does their work support a greater purpose? Can they see the impact of their efforts?
Your organization should develop a company culture where employees feel welcome and want to stay, especially considering more than half of all people who quit a job in 2021 cited feeling disrespected at work as a reason they decided to leave their last job.
Offering competitive employee benefits can also increase retention. Healthcare is among the most important benefits an organization can provide employees; however, other high priorities include more flexible hours, vacation time, and remote work options.
Beyond that, choosing benefits that align with your employees’ values can also increase employee satisfaction. For example, if employees value community involvement, consider offering paid time off for volunteer work. If employees value education, consider providing tuition reimbursement.
The possibilities are endless as long as you understand your employees’ needs and preferences.
Professional development is a priority for many employees, especially Millennials. Providing employees with opportunities to learn and grow at your organization can encourage them to stay longer.
Professional development can include regular training, access to online workshops and conferences, tuition reimbursement, and more. There’s no better way to show you value your employees than by investing in their futures and giving them the tools to grow.
Rewards and Recognition
Nobody wants to feel unappreciated. Employees who feel like their hard work and great results aren’t being recognized will be more likely to leave. A culture of recognition showcases appreciation through awards and heartfelt thanks—along with rewards like company swag or monetary prizes. Even something as simple as a kind note or a shout-out goes a long way in building goodwill and improving retention.
Creating a retention strategy isn’t just a good idea if you’re experiencing higher-than-average turnover. It’s a good idea for any organization wanting to improve its culture, employee experience, business outcomes, and more.
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A good start to improving the right kind of retention is to make sure you’re paying fairly and competitively to the market. In fact, research shows a link between fair and transparent pay practices, lower intent to leave, and overall greater job satisfaction.
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