The Importance of Staff Retention

Many companies are now beginning to view employee retention as a critical issue. High Employee turnover increases expenses and can also have negative effects on company morale.

Implementing strategies devised to retain good workers can help counterbalance replacement costs and reduce the indirect costs associated with high staff turnover such as lost clients and loss of morale.

Employee retention has become an important topic for many reasons.

These include:

• Social media networking tools such as LinkedIn make it easy to observe new job opportunities or get poached by another company
• Costs associated with hiring new staff, advertising, interviewing and hiring etc.
• Training new staff
• Loss of productivity. It can take up to 2 years for a new staff member to reach the same productivity levels as existing staff members
• Loss of engagement. Retained employees who see a high turnover often get disheartened and lose engagement

The longer staff stay with an organisation, the more productive they get .They get to know the systems, products and learn how to work together as a team.

Many high performing companies have loyal employees and each company has its own strategies for retaining their employees.

Some of the interesting things to consider:

• Compensation is a factor but does not play as big a role as you would think. Over-compensation will not offset a poor work environment
• Job fit is significantly important. Hiring the right people for the right positions by realistically advertising job positions will save you a lot of trouble in the long run. If you oversell a job you can suffer from high staff turnover. Effective retention strategies often begin during the employee recruitment process. Employees are more inclined to remain with a company that fulfils the promises made when their employment offer was extended. Companies that provide a realistic view of their corporate environment, advancement opportunities and job expectations to new hires can positively influence employee retention
• The work environment and culture matter. Staff want to feel appreciated, comfortable and included in their place of work. Employees that enjoy what they do and the atmosphere in which they work are more likely to remain employed with their company

Implementing an employee retention program is an effective way of making sure key workers remain employed while maintaining job performance and productivity.


In the end the most prosperous organisations are those that respect their employees and invest in building an engaged work place environment.

Effectively managing employee underperformance

What do you do with an employee who is not performing?  What options do you have in this area? 

You have a responsibility as an employer to ensure that they have been given sufficient opportunity to improve their performance before you resort to disciplinary action.  After all, they may be having a hard time outside of work or any number of other factors may be affecting their performance and this should be addressed with fairness.

Counselling the under performing employee is vital and entails advising them that their performance needs improving and setting out a plan for improvement.

Workplace Bulletin provides a good suggested couselling scenario for an underperforming employee:

1. Investigate the matter further

Investigate the issues before meeting with the employee so you can be sure of the facts. This may mean that you speak to other managers, employees and witnesses.

2. Hold a private meeting with the employee

Hold the session in private and retain a record of the discussions (this could be recorded in a diary).

Do not make the discussion a casual conversation. Counselling is a focused discussion that is meant to clearly show the nature of your expectations

Be specific in your comments, e.g. 'It is not appropriate to clean the roller on a machine while it is moving', rather than general, e.g. 'You need to clean the rollers properly'.

Allow the employee to respond, and take their comments into account.

Focus your recorded comments on the employee's conduct, rather than the employee as a person.

3. Develop a performance management plan

A performance management plan (sometimes called a performance improvement plan) is a document that outlines the performance goals an employer expects their employee to achieve. These can include health and safety objectives.

The purpose of a performance management plan is to:

• set out the goals or 'key performance objectives' that reflect the employee's role in the business; and
• provide measurable benchmarks for assessing the employee's performance.

Develop the plan with the employee and keep a copy in the employee's file.

If employee performance is handled correctly, problems are recognised and solved early and the need for disciplinary action is eliminated or reduced.

4. Set a review date for following up

Your performance management plan should identify further dates for reviewing the employee's progress.


Source Workplace Bulletin

Only one in 10 have innate management talent

From HR Daily:

Good managers are born, not made, but when people without this ability are promoted into management roles they use manipulation and politics to get by, often with devastating effects on employee engagement, says the CEO of global research company Gallup Consulting.

Gallup's ongoing workplace studies in more than 140 countries have found that just 13 per cent of employees globally are engaged with their jobs. In Australia and New Zealand, the proportion of engaged employees is higher, at 24 per cent, however 60 per cent are still not engaged and 16 per cent are actively disengaged, which some estimate is costing Australian employers $54.8 billion each year.

One of the keys to building an engaged workforce is hiring the right managers, because how employees feel about their job begins and ends with their direct supervisor. If employees feel, among other things, that their supervisor takes a real interest in their development, or offers frequent praise and recognition, they are very likely to be engaged.

Research has found, however, that just one in 10 people have the innate ability to lead and manage others, which assists them to become good managers with the right development.

A small number of employees without an inborn ability can manage people if they have the right support, but seven in 10 people should not be placed in leadership or management roles - regardless of the development they've received.  Employers should create alternative career paths for these "individual achievers" to avoid progressing them into management roles.

To ensure engagement across all levels, organisations need to reach a point where individual achievers are as highly esteemed as managers. One obvious mistake that many organisations continue to make is promoting employees to management based on their performance in their current role. The classic example of this is  the great sales person who is promoted to sales manager and flounders.

How else can we create engagement?

Gallup Australia senior client service manager Allan Watkinson outlined three other areas HR professionals can focus on to improve engagement:

-Don't leave selection to chance - Employee selection at all levels is the most important element to get right in order to improve engagement, you can never invest too much in that recruitment process.

-Lead with clarity - One of the biggest demotivators is a lack of clarity about expectations. Every employee should be able to answer two important questions: what do I get paid to do and what does success look like.  If you can get every employee in your company to answer those two questions, people will be much clearer and much more motivated

- Focus on what's strong, not what's wrong - Gallup's research shows that employees are happier, more engaged, develop faster and perform better when managers focus on their strengths.


from the article  "Only one in 10 have innate management talent" at HR Daily

Real Life Case Study - Performance review process

Continuing our series with real life examples of End2end Business Solutions success stories - 

One of our clients has recently undertaken a new performance review process which has been underpinned by having the 'right' conversations with staff.  

The system is a simple management by objectives (goals), with a key focus on the “having the conversation” rather than focussing on the forms and paperwork.   The staff were very excited about the introduction of the new process, as previously there had not been consistency in the review process; and the management team were also very supportive of it.

As part of the review process, the directors/owners of the business were also reviewed based upon the operations aspect of their roles.  Initially there was concern amongst the director’s, however, once the process was completed they appreciated the concept of focussing  on, and reviewing their current period achievements, and identifying the goals to focus on moving forward.  

Remuneration and development requirements also formed part of the process, and increases and bonuses were paid accordingly.   A customised training plan for the company is now being developed to be implemented as an ongoing program for all staff. 

The review process also included End2end Business Solutions individually coaching the managers, to train and give them confidence in “having the conversation” regularly with their staff.  A large number of the staff receive their bonuses monthly or quarterly,  and now the managers have the tools and system in place to have these conversations regularly,  so that there is consistency and employees know exactly what is expected of them.   The managers are finding that the more they have ‘the conversation’, the more confident they are becoming in conducting the review process.

The outcome of the new review process has been greatly improved morale, as employees are seeing the benefits of the review and of the company implementing resulting changes.

Cyberbullying in the Workplace

According to Industrial Relations tribunal statistics in Australia, workplaces are experiencing increasing claims of bullying and cyberbullying, and the problems of cyber-bullying are only expected to increase over time.

Many businesses and companies would typically have current workplace policies for internet and email usage, harassment, racism, and discrimination, however, few would have a specific Bullying and Cyber-bullying policy in place.

Employers have a duty of care under the Workplace Health and Safety Act ‘take all reasonably practicable steps’ to provide a working environment that is healthy, safe and without risks to the health of employees, contractors or other persons in or near the workplace. Australian courts have demonstrated that an employer’s common law duty of care to employees encompasses not just their physical well being but extends to their psychological mental and emotional well being as well.

Cyber-Bullying is a relatively recent workplace issue, and is on the increase with the increased prevalence of take-home laptops and smart phones, making cyber-bullying a problem outside of the physical work environment and traditional working hours.

Cyber bullying is often defined as a form of covert bullying that is carried out through the use of technology. Examples of what constitutes cyberbullying include :

• Offensive, malicious or intimidating emails or SMS communications
• Email threats, malicious or threatening comments
• Posting blogs and comments on social networking sites
• Spreading lies, malicious gossip or falsely discrediting others on blogs or social networking sites, or via email to other employees
• Sharing a person’s private data online
• Sharing embarrassing, offensive or manipulated images or videos of an individual
• Screen savers or desktop backgrounds featuring offensive content.
• On Line Harassment & Cyberstalking: repeatedly sending offensive messages and/or the posting of racist, nasty and hurtful comments using electronic means;
• Identity theft
• Exclusion, deliberately excluding another from an online group, mailing list or electronic conversation.

The nature of the internet is that it is not possible to guarantee that any content published or transmitted can be erased, removed or corrected. Cyberbullying therefore has the potential to be more aggressive and escalate considerably faster than traditional methods of bullying because of the immediacy of the medium. It is important that employers recognise that addressing cyberbullying is essential for creating a safe and productive working environment.

Cyberbullying can seriously affect morale, cause undue fear and stress, emotional exhaustion and serious health and psychological issues with employees. This can result in productivity drops, absenteeism rises, staff turnover increases, morale slumps and difficulty retaining staff in an unhealthy work environment. Cyber-bullying is a serious matter for businesses because its effects on the psychological health of victims can be far reaching, lasting and more damaging that from the traditional physical bully.

Employers who recognise the significance of cyberbullying and take it seriously will be in a much better position to avoid the negative consequences and potential legal implications of incidents. Being proactive and introducing or amending workplace policies that are specific to Cyberbullying is highly recommended.  It is recognised that the best way to prevent cyberbullying is through policy, education and training of all levels of employees.  Your policy should cover or include areas such as:

• acceptable use of technology,
• how to deal with bullying in the workplace,
• give concrete examples of what constitutes cyberbullying,
• remind staff that anything posted on the internet is out of their control and is potentially there forever
• encourage staff to draft sensitive emails and re-read them a few hours later before sending them.
• Develop a reporting and investigation process for bullying and cyber-bullying- any reports of bullying made by employees - regardless of how incidental they may appear initially - must be investigated
• Set out the consequences for engaging in bullying or cyber-bullying behaviour.

To help minimize your risk as an employer, or to find out more about Cyberbullying, contact Annette at End2End Business Solutions on (02) 8977 4002 for advice on establishing workplace policies for your business.

Hiring Wisdom: Top 10 Ways to Guarantee Your Best People Will Quit

Do you have an up to date Retention Program for you staff? 
What about your staff induction program - is it conveying the right message to your new staff members? 
If you want to retain your best staff, these are things to consider. 
For more, read this article from TLNT :
http://www.tlnt.com/2013/04/08/hiring-wisdom-top-10-ways-to-guarantee-your-best-people-will-quit/?utm_source=twitterfeed&utm_medium=linkedin&utm_campaign=Feed%3A+tlnt+%28TLNT%3A+The+Business+of+HR%29

How to retain employees and enhance job enrichment

The Insync Surveys 2012 Retention Review into why employees resign surveyed more than 11,000 employees from 40 Australian organisations over a four and a half year period, focusing on those who left their job between January 2011 and April 2012. It found that lack of job enrichment is the leading cause of staff turnover.

The research found that employees leave an organization or business:

• primarily due to the job itself, and not because of pay or relationships with managers or peers, or
• because of one or more factors, such as job enrichment, interpersonal, structural, home life, & environmental.

                               

The average Australian turnover rate of 18 per cent costs organisations with 100 employees around $1 million every year but they could save around $280,000 annually, by reducing turnover by just five per cent.

To improve your chances of retaining your employees and enhance job enrichment, employers can:

• Provide adequate resources for each employee to perform well. ie IT, communication technology, and personnel training and development.
• Create a supportive corporate culture. This includes peer support networks, supportive management, have a culture that fosters the ability for people to openly share their knowledge
• Ensure a free flow of information, and try to eliminate secrecy.
• Provide enough freedom to facilitate job excellence. Encourage and reward employee initiative by providing adequate recognition, appreciation, and other motivators.
• Provide professional development and skill improvement opportunities. This could include paid education at universities or on the job training.
• Provide job variety. This can be done by job sharing or job rotation programmes.
• Offer meaningful work as part of each role and link each role to the success of the organisation
• Be flexible in how, when and where people can complete their work.
• Have career development plans for your staff
• Ensure that new employees are offered sufficient training and do not overload them with a full workload the minute they walk in the door.

There are also other steps an organisation can take to boost retention and reduce staff turnover such as:

• Ensure that you are measuring turnover, and understanding whether it is the high performers who are departing, or the poor performers.   
• Create enriching and meaningful jobs – this allows organisations to match staff with the right job for their skills and interests, thus reducing turnover
• Be flexible – be accommodating of changing life circumstances - This is the second biggest contributor to staff turnover. Be creative in the use of both short and long-term flexible work arrangements.
• Put a value on transparency – trust and honesty are important in a team.
• Impartiality is also essential to employee retention. Everyone must believe they all have the same chance and every decision must be unbiased.
• Recognise performance – and offer rewards that are not just contingent on a behaviour or result. Think outside the square and consider other types of rewards – access rewards such as discounted insurance or mobile phone packages.
• Where possible, empower staff members to make decisions and take ownership of what they do.
• Conducting exit interviews and regular staff surveys, seeking informal feedback from managers and establishing a retention strategy.

 Reducing staff turnover should not be considered solely a HR issue, all areas and levels of management should give this attention in order to boost employee retention and ultimately help the bottom line of your business. Giving due attention to all areas of the hiring & training process,  actively working to maintain and improve staff morale and having an effective employee retention will go a long way in preventing a high employee turnover.

For help with retention programs, performance reviews, or any staffing issues, please contact Annette at End2End Business Solutions for a customised solution.

Looking beyond the Performance Review for your next leaders

A mistake that many businesses make is to ignore or dismiss an employee’s leadership potential based on their current job performance, and focus instead on the perceived highest performers who may not actually have the ability to manage and lead a team or implement and deliver on strategy. Employees with skills such as the ability to work well under pressure, great communications skills, motivation and a real passion to progress further should be identified as they may be the future leaders of your organization.

To identify employees with genuine leadership potential, managers will need to look beyond what their current results may indicate, and assess their real performance potential in a future role. Some important factors to consider are:

• Assessing the employee’s motivation– a simple but often overlooked measure is to ask if the individual is actually interested in moving into a leadership role. Does the employee want career progression and leadership development – if they don’t actually want it, and would rather be comfortable and high performing in their current role, then there is no point in promoting them. Sometimes they may be best left in their current role.
• Behaviour– exhibiting the desired corporate behaviours for your industry/business, having good communication skills, maturity and an ability to motivate others are all important.
• Potential– not all high performers have high potential!

So take the time to really know your employees, not just from their current performance review, but from their potential performance review.