Employee Turnover - Is There Anything I Can Do?

Have you ever stopped to consider that employee turnover can cost you 30 percent of an annual salary? According to the American Management Association, this is a conservative estimate. Translated - if you employed 20 part-time people who were earning minimum wage and experienced a 100 percent turnover, your average cost to replace an employee would be $500 and you annual replacement cost would easily be $10,000. Have you ever considered investing in an employee retention plan?

The top two reasons people stay with a company are:

1. They feel the company cares about them

2. They add value to the company

In a national survey on employee job satisfaction, income and benefits ranked fifth and sixth in terms of importance. Although income and benefits may attract someone to your company, these alone are inadequate to foster long-term relationships. The development of long-term relationships should be fairly high on your priority list.

Here are some ideas to help you improve employee retention:

Personal recognition: How many times during a week do you tell your employees what a great job they are doing or how important they are to the growth and longevity of your company? Put it on your daily schedule to recognize at least one person for something he/she has done.

Keep a box of notes on your desk so you acknowledge someone weekly in a written format. A hand written note tells that person you took time out of your day to acknowledge them.

Recognize special occasion. Birthdays, employment anniversaries, wedding anniversaries or other special achievements are milestones in individuals' lives. I receive a birthday card every year from Southwest Airlines. I am one of 71 million people that flew with them last year but it puts a smile on my face every year when I receive their birthday greeting and makes me glad I do business with them. Think how it makes an employee feel.

Feedback is a requirement! Typically in a group of 50 managers or business owners, only two or three people have told their employees how they are doing. Spend 20 minutes a week with your employees letting them know what they are doing well and the areas for improvement. Most people are willing to help improve a situation if they know what you expect or need.

Information is power! Get your employees involved in reading and understanding a balance sheet. Let them know what sales and expenses are for the month. Ask them for their suggestions on ways to increase sales and decrease costs. They see things from a different perspective and notice things you might not.

People with a common mission can accomplish amazing things! If employees understand the status of your business in real terms/numbers and if you explain what results you are trying to achieve, you might be amazed at the end result.

Let the family know.  Send a letter to every employee's family, spouse or significant other expressing your pride in their performance and commitment to the company. Every month identify those that have gone the extra mile and drop a quick note to the employee's family letting them know what an impact that employee had that month in the company.

Reward! Reward! Reward!  Get your employees involved in defining what rewards would motivate them. A national company with 900 locations set up a study to compare cash versus non-cash rewards. The non-cash group out performed the cash group by a 46 percent margin while generating a 37 percent increase in sales, in comparison to the previous 6 months without an incentive program. Simple, inexpensive rewards can make a big difference in the bottom line of your sales, customer service efforts and employee retention.

It's the small things that tell your employees you care. Take just one idea  and implement it over the next 60 days. Measure your results- you might just be amazed!