No one wants to lose their best performers. They are the most productive, the people you lean on, and the foundation you build your organization on. In spite of these facts, we sometimes take them for granted. The easiest way to decrease hiring costs is to increase the retention rate of those who perform best! Keep reading for some ideas on how to do this.
In case you were not aware, the total cost of losing an employee can equal two times or more of that employee’s salary. These costs include:
- Loss of productivity
- Hiring costs
- Potential errors during transitional period, especially in healthcare and customer service industries
The top two reasons top talent leave their current companies for others is their management and a perceived lack of empowerment in their roles. No one wants to work in a negative environment. Many times their direct report is to blame for the working environment. Having a boss that they believe is inflexible, doesn’t listen, etc., is the number one reason the best talent leaves an organization.A lack of empowerment is cited as the second most common reason for a job change. Even great bosses can trigger a job change if they do not empower their team to solve problems or influence decisions.
Internal politics is the third reason why top talent leaves their current positions. The feeling that new opportunities in their current role or ways to climb the corporate ladder are inaccessible is a huge turn off. Top talent will passively or actively seek out a new position with a new company to navigate their way to a higher position within their industry.What about compensation? You might think this is the final reason for turnover, but it is not. Recognition is the fourth most common reason the best talent leave their organizations. Money talks, but often just a simple “good job” or lunch with members of your team will do more for employee morale than most think. Giving credit where credit is due shows team members that they are respected. Invest some time to find people doing something “right” and reinforce that behavior by recognizing it. This takes very little time and the returns are phenomenal!When a company acknowledges their weaknesses in these areas and that they are reasons why your best people might leave, employee retention will increase, often significantly. Implementing a simple talent management system will decrease hiring costs while increasing employee satisfaction.