The biggest most powerful incentive to reduce staff turnover, is the cost to the business. There are many calculations regarding the cost of staff turnover. They range from the most conservative that puts the total cost of replacing a staff member as being equivalent to a minimum of 30 weeks income for that staff member. At the other end of the estimates the figure of 100 weeks is suggested.
Whatever the figure it is a preventable loss to the business.
Staff retention strategies are not costly. However they do require thought, effort and time. It is relatively easy to justify staff retention programs when you know the losses incurred through staff turnover. To get approval for a staff retention program, current losses are a powerful argument.
From a business point of view, the CISCO STAFF losses incurred through staff turnover will make a dent in their net profit. Staff retention is a low-cost initiative and represents a considerable return on investment. Every thinking business should invest in strategies to retain its staff because it is an economically sensible decision.
There are not many alternatives to an effective staff retention program. Paying higher wages has proved to be a limiting strategy. After a while you will find that you have recruited wage and salary sensitive staff. Just remember, if you employ somebody because you’ve offered a higher rate, they will be the first to leave when faced with an even higher rate.
The factors affecting staff retention are relatively simple but must be managed carefully. Income is only one of the many aspects of staff retention.
Surveys over the years in different countries show that there are different factors that have been identified as what people want from their work. High income typically is fourth or fifth on the wish list of desirable benefits that can be achieved from work. Things that come before income are, recognition, being involved, respect and personal development. Surveys and studies show that most employees want to do a good job and also work to their potential.
Sense of involvement. A lot of people need a strong sense of involvement with the business in which they work. They feel that a lack of information is a disincentive to put their hearts and mind into the work. They like to be a part of the organization with the opportunity to voice their opinion and add their ideas.
Because the workplace is a social environment, people do not want to be just treated as a number. Most of them enjoy belonging to a team and participating in teamwork. This teamwork does create a sense of obligation to the other members of the team. It obviously pays to recognize and create teamwork because of the contribution to staff retention.
Because of the diversity of human beings not everybody wants to be part of the team. These individuals have to be treated differently and not shoehorned into a team against their wishes. This is where the leadership skills of the immediate supervisor are put to the test.
Recognition. Recognition contributes to the sense of involvement. It takes many forms. Acknowledgement of a job well done and specific information of why the performance deserves your special attention is a good form of recognition. Recognition of a person who is working under difficulties such as pressure and stress, goes a long way to reducing the effects of the stress on the individual. It is surprising the number of managers and supervisors who do not use recognition and praise as part of their leadership style. It is one of the most effective leadership tools and costs very little.