Your company’s profitability and productivity suffer when employees leave. You can’t control some degree of employee turnover, as it is inevitable.
However, you should know how to increase employee retention. How do you achieve this?
What is the most effective solution to turnover?
You’re just in luck.
In this article, we’ve gathered valuable tips from team management experts on reducing employee turnover in small businesses.
After reading this article, you will be able to retain your best employees, increase productivity and grow your business.
But first, let’s discover what causes employee turnover in small businesses and how to reduce it.
What are the causes of employee turnover in small businesses?
Regardless of how many you have, your employees have probably experienced some work-related frustration.
So, before implementing strategies to reduce employee turnover, it is essential to identify what causes your employees to leave.
Let’s take a look:
- Bad managers: Managers who ignore their employees’ development cause them to leave their companies.
- Stagnant wages: A lack of bonuses, raises, and minimum wage increases might cause employees to feel undervalued and unappreciated.
- Bad corporate culture: Employees who feel appreciated and respected by their colleagues are likelier to want to stay with their current employers.
- Flexibility: Businesses that adhere to rigid schedules may indicate that their leader(s) must be more open-minded, which could lead to employees feeling that they can’t thrive there.
- Excessive workload: Tired and burned-out workers are 31% more likely to consider looking for a new job than their colleagues who aren’t.
Now you know what causes employees to walk away from an organisation. Let’s explore what experts say about employee turnover and retention.
How can a small business reduce staff turnover?
Finding and training a new employee consumes time and money. So, how can you minimise employee turnover in your small business?
Below are 6 expert-recommended ways to reduce employee turnover.
1. Ensure fair compensation
Qudsia Piracha, a Product Owner at Getbravo.io, says this about employee turnover:
“Competitive salaries and a clear promotion path can decrease employee turnover and increase employees’ motivation, engagement, and productivity.”
So, don’t be surprised if your employees leave or look for new jobs when you fail to compensate them fairly.
You can compensate your employees fairly by promoting them and providing them with better salaries.
Furthermore, you can implement talent management processes aimed at identifying top performers.
Analysing racial and gender pay equity can also correct pay imbalances. As a result, you can limit turnovers related to compensation.
2. Invest in training your employees
Mark Gandy, Creator of the Financial Operating System, says:
“You need to train your employees to retain them. Training leads to mastery in the role your employees are performing. Keep raising the bar on your employees’ training as the person or role evolves.”
Training that strengthens existing skills or builds new skills is important to employees.
Investing in your employees’ training will increase their commitment to your company’s future. So, introduce a training program for your employees.
For instance, introducing workshops on professional development can be practical and appealing training initiatives, but only if your staff is interested in learning about those topics.
“With outside expertise, we’ve done workshops covering everything from yoga to personal finance to anti-oppression,” says Kelsey Raymond, co-founder and president of Influence & Co.
“The team told me that they appreciated us investing in them in learning about a wide range of topics other than marketing.”
3. Provide flexible work arrangements
Qudsia Piracha gives one more employee retention tip and says, “Providing flexible working arrangements can help small businesses retain, engage, and satisfy their employees.”
Flexibility permits employees to balance work and family life.
An online job board, Flexjobs, reported that 30% of workers had left a job due to its lack of flexibility. Another 80% said flexible work options would make them more loyal to their company.
Telework and remote work aren’t the only types of flexible work.
Flexible work schedules can include flextime (where employees must work a prescribed number of hours but can choose when to work them). You can also offer compressed work weeks, part-time schedules, or job-sharing, where workers rotate days in the office.
Managing remote workers poses challenges. But as a leader, you should explore whether other options are effective for your organisation.
4. Develop true relationships with your employees
Philip Williams, 3-time Inc5000 CEO and Business Coach gives a practical employee retention tip.
“When you invest in your employees’ dreams and goals as a leader, they reciprocate by investing in yours through their performance. It’s called the reciprocity law.”
It makes sense that when you care about your employees’ dreams and goals, they feel compelled to return the favour.
But how to do that?
Why don’t you offer career coaching to your employees the same way you offer health coaching?
Alternatively, you can offer discounted sessions with a certified career coach as part of a mentoring program. As long as employees understand you support them in achieving their goals, you will succeed.
5. Show your employees their career path
Patriot Software’s CEO, Mike Kappel, says employers should demonstrate a clear career path for their employees.
From their current position, what are their options? It might be an upward or lateral move. You can give your employees more responsibilities in their current position. It doesn’t matter what it is; let your employees know how they can advance.”
Employees may seek another job where they can advance if they remain stagnant for too long in one position.
Many employees hope to advance their careers by gaining more skills and knowledge. An employee’s career path helps them feel purposeful and orientated.
Allowing employees to discover and apply for other opportunities within your company is one way to show them their career path.
People are more likely to look inside than outside if they believe their career development is a priority.
Create a job search site for your company and communicate it through posters and newsletters if you still need to create one.
6. Make work and communication easy
When your employees don’t have proper work tools and don’t know where to communicate their challenges, they get frustrated.
Having enough practical tools within your organisation makes them consider other organisations where it’s easy to communicate and have a streamlined workflow.
So, ensure you introduce tools like Talk Magnet to streamline organisational communication. As a result, your employees will always know what is happening in the company and what the workflow entails.
When you introduce tools like Talk Magnet, a communication and collaboration app, your employees can quickly transfer information.
Talk Magnet is a lightweight and easy-to-use app. You can have your employees share important files, make specific groups to share the company’s goals and challenges, and ask employees to update their daily tasks.
This way, you provide your employees with essential tools to streamline organisational communication.
Ready to implement employee retention strategies?
There you have it. Proven ways to retain your employees and what causes them to leave the organisation.
To attract and retain more employees within your small business, you need a practical tool to make your employees’ work more accessible.
Talk Magnet is that tool. It is hands down the most straightforward yet powerful team communication and collaboration app.
So book a demo today and sign up to try it for free.
Want more information? Please read our article on the best team communication app for SMEs.
