Strategic Ways to Increase Employee Retention While Reducing Costs
The US in 2019 reported a labor force shortage as the number of open job exceeded the number of applicants. This might be symptomatic of a global trend. A study of 25 major economies released in 2014 by the Boston Consulting Group predicted widespread labor force shortfalls starting from 2020 to 2030.Is your company one of those finding it challenging to fill certain vacant roles? Here are some strategic ways to increase employee retention while reducing costs:
Challenging, Rewarding Work
Among the factors that bind employees to their company is the opportunity to do exciting, challenging, interesting and varied tasks that demonstrate their skills and talents. These opportunities also enable them to achieve a level of personal success, sense of purpose and contribution to the company.
Good Management and Leadership
The most effective and sustainable employee loyalty measure is also the most cost-effective: good leadership, whether it is from the direct supervisor or the highest executive levels. Good leadership includes:
- Positive perspective
- Appreciation and praise for employees’ achievements
- Support for training
- Ability to motive employees with challenging, interesting work
- Listening to ideas opinions from all, respecting decisions
- Active participation
Employees should be able to know the value of their work. Purposeful activities, goals, and perspectives are important. This is helped by the corporate culture that leadership establishes and encourages, and is manifested in values such as respect, trust, appreciation, honesty, and credibility.
Good employees appreciate being consulted, being given responsibility and room to take initiative and mistakes. These practices enable them to self-motivate and keep improving.
Flexible Working Hours
Flexible working hours are one of the biggest reasons that employees stay in the one company for a long time. If you want to encourage your employees to stay or attract new specialists, innovative work-time models are almost indispensable. Employees who are allowed flexible hours to meet personal and family needs are usually more responsible and more motivated.
Company Organization and Structure
Employees remain with companies that are well-managed, and practice good organizational and structural frameworks, core values and goals. Company policies should be published for transparency. This includes the use of modern management tools such as:
- Transfer of responsibilities
- Appraisal interviews
- Goal alignment in employee development opportunities