3 Ways That Leaders Can Improve the Employee Retention Rate

BY C. Lee Smith
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If the labor market is cooling off slightly, your employees may not be as quick to jump at the next shiny offer that gets dangled in front of them. But that’s no reason to stop worrying about your employee retention rate. If the right opportunity comes along, you could be saying farewell to your best and brightest team members, unless you take action. Specifically, as a company leader, you should address:

  • Manager training
  • Employee incentives
  • Corporate culture

The Connection Between Manager Training and the Employee Retention Rate

Our research shows that over 30% of sales professionals have changed jobs because of their unhappiness with their manager. Top issues that reps have with their managers range from lack of motivating team members (35%) to poor coaching and team member development (32%). These trends are nothing new. But they should serve as a wake-​up call regarding how you are setting and measuring your managers’ goals.

Managers need to be measured against a new set of metrics that reflect their focus on the development of organization-​wide people potential. These metrics could include the number of career experiments they’ve sponsored within their team and supported for people to explore outside of their team," Helen Tupper and Sarah Ellis say

If your managers are rewarded only for what they do on an individual basis instead of how well they are developing the employees in their unit, there’s a disconnect. What motivation do your managers have to provide additional training and opportunity for team members? If you don’t have a good answer to that question, it’s time for a change.

Set up a system that rewards managers for developing the employees in their department. Whether it’s onsite training, job rotation or outside professional development, make it possible for your managers to offer these benefits to employees. Younger team members, in particular, want to learn. They’re eager for professional development and a career path. If you don’t offer it, someone else will.

Employee Incentives

Businesses spend a significant sum to retain their customers. Why shouldn’t they do the same to improve their employee retention rate? TaMika Fuller and Juana Lang, at the University of Phoenix, based on their research, proposed an employee incentive loyalty program. However, the same incentive may not work for every team member.

The path to a better employee retention rate is to offer what team members want in terms of incentives. Your managers should have access to what motivates their team members. Their psychometric assessments will reveal whether an unexpected bonus or a tuition remission program will be most effective as a retention strategy.

Corporate Culture

As a business owner, I strongly believe a company’s culture is built from the ground up. Over time, key employees may establish practices such as Takeout Thursdays for lunch or celebrating birthdays in the break room with cake. Leaders should celebrate the positive traditions in their business.

On the other hand, business owners must set boundaries for the types of workplace behavior they’ll tolerate. That goal means paying attention to what’s happening on a daily basis in the organization. Mark Miller asks, “…are you seeing unhealthy competition, lack of cooperation, apathy or loss of procedural discipline?” If so, you should swiftly address the issues with the team members who need to work on improving their positive workplace interactions. 

All employees deserve an environment where they feel safe and are encouraged to bring forth innovative thinking and their best ideas. When managers encourage them to develop their skills to advance to the next level and reward their progress in a meaningful way, the employee retention rate will soar.

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