The staggering cost of low retention
Low retention is a serious problem for many organisations. According to Life Work Solutions, an Australian provider of staff retention and consulting services, over 50% of staff recruited into an organisation will leave within two years. Also, one in four new hires will leave within six months.
A study conducted by Oxford Economics reveals that replacing staff members costs almost AUD$49,000. Amongst the staggering costs are the losses experienced when a replacement employee produces low output as he or she gets up to speed, as well as the various expenses involved with recruiting and training a new staff member.
Workstar’s Head of Sales, Sue Fell says, “Recruiting new staff is unnecessarily stressful, costly and time-consuming, so it’s in each organisation’s best interests to discover why their people are leaving, and then develop some key strategies to avoid low retention rates.”
What causes employees to leave?
There are various reasons for employees leaving organisations, but the common perception is that most people leave businesses simply because of inadequate financial reward. However, according to strategic planning consultant Leigh Branham, 88% of staff leave their jobs for reasons other than pay. These include low morale, stifling workplace culture, lack of autonomy and career advancement opportunities, boredom, stress, loss of trust in leaders, and lack of engagement.
How do successful businesses avoid low retention rates?
While it’s inevitable that employees will leave, there are a variety of strategies to avoid low retention rates. These include:
The final strategy, offering continuous training, is a bone of contention for some employers. Some organisations believe that after initial training, people can ‘learn on the job’ and that continuous, well-planned training is simply too expensive. They also believe that some employees don’t respond to training because it eats into their time and they don’t like being micro-managed. However, those organisations who believe continuous training is a waste are potentially suffering the lowest retention rates.
1. Developing a culture of learning
As a business leader, you should make it a priority to demonstrate that your company values each employee enough that you want to invest in their continuous development.
"Learning cannot just be an afterthought," says Kevin Griffin, CIO, GE Capital. "It must be a core focus of any strong organisation. There is never a point during your career at GE Capital when you're done learning."
Griffin’s ethos should be reflected in every successful business, because learning helps employees feel valued and respected, it helps them acquire new vital skills and develop confidence, it opens up doors for new opportunities, and when executed well, it can lead to true innovation.
When training is truly effective, productivity is increased, overall business performance is strengthened, and yes, profits are boosted. So, as a business leader, how do you cultivate successful learning strategies within your business?
2. Ensure your learning is engaging
Gone are the days when learning was only presented to groups in lengthy sessions within a classroom environment. This style of learning is outdated and only exposes the inconsistencies in trainers. There are a variety of exciting approaches to learning now available, such as digital and mobile solutions, interactive gamification, face-to-face training, and of course, blended learning.
3. Develop a sense of mastery
Employees are more and more driven by their sense of mastery, which is the willingness to achieve successful outcomes through long-term dedication and persistence. It’s crucial that you develop strategies that allow your people to self-discover and unlock real engagement in their learning pursuits.
4. Don’t let your learning interrupt workflow
Employees rarely have lengthy chunks of time to devote to learning. However, the introduction of mobile and digital learning solutions means that your people can learn when it suits them, and at a location that suits them (at work, at home or while travelling). If you’re not embracing technology to deliver your learning strategies, perhaps now is the time to discover how it can not only engage your workforce, but how it can also make your training more accessible and attractive.
5. Present it in digestible, bite-sized chunks
Over the last decade, extensive research has revealed that humans lose focus when presented with lengthy pieces of information. Today’s learners are drowning in a sea of data and they respond more positively to information presented in smaller chunks, usually under ten minutes in duration. Bite-sized learning presented on laptops or mobile phones suits people’s information-rich lifestyle, as opposed to traditional corporate strategies. This enables learners to access their learning anytime and anywhere.
6. Ensure it’s relevant
Is your learning entirely up-to-date, customised and applicable to the roles and tasks that are presently required of your people? Every team has specific roles to master, and the implications of presenting outdated, generic or irrelevant learning solutions will result in your learners simply switching off. It’s also imperative to design solutions that measure learning against business outcomes, and this ensures you can track real behavioural change.
Developing a culture of continuous learning within your organisation will have a profound effect on your success. If you’re investing time in empowering your people to learn new skills, grow in their roles, collaborate with their colleagues, and be actively inspired by advances in learning technology, you’ll increase productivity, profitability and ultimately, your retention rates.
If you’d like to learn more about our award-winning approach, please contact us on:
email@example.com | P +61 2 8302 6300
‘How to Improve Employee Retention’
Friefeld, Lorri (2013)
‘Training Increases Employee Retention’
Yazinski, Sarah K. (2009)
‘Strategies for Retaining Employees and Minimizing Turnover’
‘Training and Its Impact On Employee Retention’
October 28, 2014