The job market is increasingly competitive for companies looking to attract the top talent and many are willing to one-up rival companies in order to do this. However, concentrating all your efforts on attracting and hiring talent without equal effort on retention will cause problems for SMEs further down the line.
High employee turnover costs SME business leaders in time, money and productivity. What can be done to reduce staff turnover in SMEs and the effects it has?
Why do staff move on from SMEs?
Staff retention is an issue for many SMEs for a variety of reasons. Initially, SMEs are often the preferable choice over larger companies. Recent graduates and those taking a change of direction in their career find SMEs can offer them a job ‘on the frontline’ of a business – watching the outcome of their work first-hand.
A role in a smaller company will also encompass many areas of a certain field to gain a larger breadth of experience – as opposed to being a small cog in a giant company machine.
However, after fighting off fierce competition to gain the best talent, staff at SMEs soon desire to move on for career progression and a pay rise – which they see as coming from larger companies.
There is now more of a need that ever for SMEs to review staffing levels and to retain those with the experience, skill and knowledge to carry the business forward through ongoing economic and political uncertainty.
Staff engagement and motivation need to be high on your list of priorities – but especially in tough times. This is crucial for retaining your workforce as well as being the key to creativity, innovation and increased productivity.
So what can you do to retain your staff and key players?
Communicate your company’s goals
Gymshark, one of the fastest-growing fitness apparel and accessories brands, recently came second as the top British startup to work for in 2018, according to LinkedIn. Part of the reason for this is thought to be their view of their employees as ‘visionaries’ who work together as a ‘family’ of like-minded people.
SMEs need to make sure that employees feel like they are an asset to the company, not an overhead. You need to ask staff for their input on changes and decisions and clearly state what is expected of them.
More than ever, employees want a culture of shared information and openness. They want to know that the future of the company is positive and what you are all collectively aiming for in the future. If you communicate the goals of your company and employees feel part of the team working towards a common goal, they will feel valued.
Analyse your employee benefits package
Employee benefits are an invaluable tool for effective staff retention, which keep a long-term emotional attachment to the employer. Good employee packages are not just for the tech companies. The Hakim group of independent optical practices, proved this by coming top of The Sunday Times 100 Best Small Companies to work for 2018. The Hakim Group in Lancashire have 62 employees who enjoy a range of benefits such as a health plan, pension scheme and access to the financial flexibility scheme.
Offer employee perks and get smart with them
Free fruit to snack on in the office and pay-day pizza delivery may seem like small gestures, but perks like these all work towards creating an environment where staff wants to be.
SMEs can also offer financial rewards such as profit sharing or an ownership stake in the company.
Rewards don’t have to be seen as an expenditure, but rather an investment in your employee productivity and can even be said to contribute to marketing activity. They also don’t have to be cash rewards.
Get smart with employee perks and look for some of the more outlandish rewards, taking your staff for a helicopter ride for example, which offer company branding as part of the corporate package. When shared by your staff on social media your brand is returned with valuable coverage online.
Memorable rewards will also provide an incentive to staff to go that extra mile for the company and the impact will remain with them long after the event. These rewards will also make staff feel valued as they gain recognition for their hard work.
Poor work-life balance often comes at the top of employee’s complaints about a company and given as a reason to move on.
Family time is often non-negotiable for employees and can be negatively impacted by certain jobs. Those experienced and valued staff members will look to find another job elsewhere. Company perks can look to find solutions to this such as offering parental leave above the statutory minimum.
Companies can also make sure that returning to work is as easy as possible for new mothers and fathers. The companies that are highlighted as being the best are the big companies, yet often these perks are not expensive and easy for an SME to action. For example, Spotifysendsd employees who have just had a baby a simple yet thoughtful gift package including ear defenders to raise a smile, while Yahoo/Oath gift new parents returning to work with a Starbucks card for that much needed caffeine fix.
SMEs also need to focus on new fathers as well as mothers, with flexible working options which result in fewer absences and costly recruitment drives. By creating a pro-paternity leave environment, SMEs will be seen to fight the gender gap. This leads to a more loyal workforce who will admire and promote the company they work for.
Identify existing development and training needs
Staff training doesn’t only increase their skill-set to the benefit of your business, but also increases employee retention by reinforcing the value of the employee. It also boosts their self-confidence – employees want to feel that the job they do is done at the highest level and helps the business.
Deverell Smith are a recruitment consultancy who offer a management training program led by the firm’s Talent Director and a non-executive director who has 20 years of experience in Learning and Development. The Deverell Smith Training Academy provides continuous training alongside informed and impartial counsel from an industry expert. They also provide regular workshops with motivational speakers and external trainers.
Start conducting ‘stay’ interviews
Exit interviews are common, but it is also helpful to interview long-tenured employees. ArcelorMittal USA, a global steel and mining company in Chicago, cited that incorporating a stay interview process has had a positive impact on retaining their key employees.
A stay interview will allow you to find out why they have stayed so long and what they would change and improve. You can then use this information to improve your staff retention strategies.
You don’t have to be a trendy tech company or a company with a big budget to make your company the place where your employees want to stay. You can make small changes to the working environment and tailor them to the needs of your business and your staff.