Why good employees leave
What is happening in the business world? 41% of all businesses with 10 or more employees report they find it harder to fill vacancies, and in 2021, the U.K. tech industry had 100,000 open vacancies per week in the first half of the year. Not only that, once you find the right person for the job, it’s harder to keep them. What has changed in the past years?
There are currently three generations on the job market who grew up very differently: Generation X (those born between 1965-1980), those born between 1981 – 1996 (Millenials) and 1997-2012 (Generation Z).
Generation X grew up in a world where many jobs were forever, and loyalty to a company often paid off. True, that was often at the expense of their work-life balance, but the rewards were worth it for many.
That doesn’t hold true for Millenials or Generation Z. They have never experienced a safe work environment with guaranteed employment. Instead, they were born into a world of zero-hour contracts, a worldwide recession and austerity. They might have also seen their parents working long hours, sacrificing their own personal happiness for a company’s growth. And they began to ask why they would do the same if they wouldn’t benefit as their parents had.
Finally, it seems like the job market is working in their favour: there’s a shortage of qualified staff in almost every sector, especially in the tech world. Companies compete for the right people and are now willing to offer perks once unthinkable.
Now the question is: what do employees are looking for in a company? And how can it provide those benefits without a reduction in productivity? Could things like a 4-day week or working from home help not only the staff but the company as a whole?
What employees really need
Herzberg’s two-factor theory
What do employees need to be happy and productive? Frederick Herzberg, a U.S. clinical psychologist who later became a Professor of Management at the University of Utah, asked himself that question very early on. He believed that ‘mental health is the core issue of our times. His theory is based on two factors.
First, employees have physiological needs that their job should fill. He calls them “hygiene factors.” They are:
- Working conditions
- Peer relationships
- Leadership quality
- Job security
The second one is dependent on the job conditions and motivation. Employees need a reason to come to work besides the pay, and these conditions give them that. They are:
- Job satisfaction
- Growth opportunities
Keeping good employees is similar to client retention. Like the people that spend the most money on your business, your best employees deserve extra attention and the occasional reward. Everyone wants to feel seen and valued, and acknowledging that will create a positive atmosphere in the workplace that keeps people motivated. How can you find out if your organisation is lacking in any of these areas? Shannon Miller, HR manager at Observe.AI, shares her ideas:
It is important to send out pulse surveys to collect data on the perception of the org such as trust in leadership, team and cross-functional experience, manager dynamics, role motivation, compensation and benefits evaluation. In tandem, hosting live listening sessions such as cross-functional smaller round table discussions or anonymous company wide AMA (Ask Me Anything) sessions as part of all hands meetings can gage what’s happening in the organization. With the data, you can get a better understanding of what needs to be done for the sake of improvement and how to appreciate the talent you currently have at the organization. This will ideally help retain your top performers and gather an accurate perception of what it’s like to work at your organization from the lens of the employee experience.”
Let’s look at a few of Herzberg’s points and how businesses can use them to keep the best talent.
Working conditions- is remote working the answer?
Most companies have realised that the old working model of 5 days a week in an office has fallen out of favour. A recent survey revealed that 43 out of 50 of the U.K.’s biggest companies have embraced a hybrid working model of two or three days working from home.
It can be done: in 2021, the accountancy group PwC ran a so-called summer hours pilot. For the first time, employees could finish at lunchtime on Fridays between June and August. It went down so well with their staff that they extended it for a month this time. As Kevin Ellis, chairman of PwC, stated, “the positive impact on wellbeing surpassed expectations.” Three-quarters of its workforce said it helped their general wellbeing greatly. In addition, PwC has also changed its stance on hybrid working. Staff have to be on-site with clients two or three days a week, but they can fix their own working patterns.
Deloitte, another of the industry’s so-called “Big Four”, now allows its employees “to work where, when and how they wish in the long term.” EY’s 17,5000 got a financial boost: they shared a £20 million lockdown bonus last summer.
But Ian Whiteford, founder at Rebel HR Consulting, thinks there isn’t a one-size-fits-all solution:
“The companies I am advising with solid retention rates are the ones focused on personalising the employee experience to meet the needs of each individual. A one-size-fits-all approach to working location, working hours, employee benefits, role creation, etc, no longer works in this competitive market. Higher flexibility creates higher retention and ultimately leads to more successful businesses.”
What if our company can’t offer remote work?
Let’s be clear: there will always be jobs that can’t be done remotely. But what these jobs are changes according to our perception. I found this article from 2017- all of the positions listed were done remotely during the pandemic, and many CEOs are now working remotely. In a sector where remote work is genuinely impossible (for example, in construction), it pays to ask your employees if they would like flexible work patterns instead. Maybe your company can make it easier to change shifts or be flexible with breaks. Listening to your employees and creating a work environment where they thrive is always possible, regardless of the work itself.
A single employee can ruin the atmosphere in a team. Certain behaviours shouldn’t be tolerated as they can decrease productivity and make good employees leave. Sometimes, a business holds on to an employee like that because they are excellent in their job. But can you afford to have one employee who exceeds at the expense of others?
Much has been written about leadership. Studies show that people who are average at their job but good with people are better leaders than those who lack empathy for their colleagues. It’s worth paying attention to this detail when choosing a team leader.
Wendi Cochrane, head of HR at Magdalene, recommends the following when speaking with people in a leadership role:
“Really get to know them (the employees). Find out what their motivators are, treat them how they would like to be treated (not how you wish to be treated), and maintain respect at all times.
Be honest and be authentic. Help them get to know you, both personally and professionally. Act as a mentor and coach sharing your own career highlights and lowlights. Allowing them to see your flaws is a strength not a weakness.
Identify and build on their strengths. Provide them with a safe space in which they can learn and develop in the direction and pace that meets their career goals.
Although getting the reward package right is important, I strongly believe that if you get these basics right first then reward becomes secondary.”
In an economy like ours, this one is tricky. Here it’s essential to be honest and straightforward: if the business isn’t doing well and might need to axe a specific job, it’s better to let your team know right away. No matter how many perks a business hands out, people never forget how they were treated in times of crisis- and the colleagues who remain won’t forget it either. Treating people as a commodity will only motivate the remaining ones to leave that company as soon as possible.
It’s simple: when people feel they can’t grow in their current job, although they want to, they have no choice but to leave the company. Looking for ways someone can show their value for the business they work for is essential for keeping them. It’s a good idea to ask them at their annual review what they would like to try, but also to give them opportunities they feel they’re not yet ready for. Overcoming a challenge makes us feel good and increases our skills faster than any theoretical learning could.
Recognise your employees’ achievements
Make it personal
Nothing is worse than receiving a pre-printed postcard or an otherwise generic acknowledgement. Your team member went beyond their call of duty; why not tod the same? EON boosted morale by scores by up to eight percentage points due to its successful (and very personalised) recognition scheme. It can be done, and it will make a measurable difference to your retention rate.
Celebrate a work anniversary
Every culture marks special occasions like birthdays, marriages and religious festivals. There’s a reason for that: celebrating something gives us a dopamine hit and makes us feel good. It can also strengthen your network to celebrate with work colleagues, and it’s a great way to stop and appreciate what someone has achieved in their time at the company.
How to onboard a new employee
Retention starts with recruiting. Often, companies don’t set clear goals for this process. First, you need to identify what parts of your company culture are most important to you. Then, look for employees who embody the qualities you need to emphasise. You have to drive the recruitment process and be results-oriented. That can mean rejecting an otherwise great candidate and requires courage. But it will save you long-term problems and increase your retention rate.
It takes the average employee around four months to get a job. By the end of that time, they’re likely to be exhausted from the process and elated they found the right position. A good onboarding process will reassure them that they have made the right choice in joining your company. And it’s not hard to do: first, the paperwork the employees need to fill out should be easy to understand and limited to what’s necessary. Simple fonts, clear language and good visuals go a long way (and are surprisingly rare).
Then, welcome them. The first day should be kept simple: show them around, let them meet their colleagues and answer any questions they might have. It helps if team members take the newbie with them when going out for lunch.
Next comes the training phase. Here, it’s crucial that your new employees have easy access to the learning management system and know how to use it. A high turnover rate is often the result of employees feeling lost and dissatisfied with their training. It’s stressful to make it up as you go along. Companies with a well-drafted hire plan have a definite advantage here.
New employees need to know what success, quality of work, and productivity look like in your company and their new role. Assuming they’ll learn by watching others is a recipe for disaster. Open communication will make all the difference here.
Would your People Team like support in increasing employee retention? Book a call about a custom programme or workshop for your team to change the narrative in your company.