Motivational and Performance Management to Increase Retention Rates
A business can improve the quality of their employees through an effective employee retention program. An employee retention strategy is simply a plan that companies develop and implement to reduce employee turnover, avoid attrition, increase retention, foster improved employee engagement, and increase customer satisfaction. Companies spend millions of dollars annually on recruiting, training, retaining, and promoting new employees. It is important for businesses to follow up on the recommendations of customer satisfaction surveys, feedback, and evaluations to determine if new strategies are impacting retention and engagement.
A company can measure the effectiveness of their customer retention strategies by measuring key factors such as customer satisfaction and retention history, staff turnover, and recruitment and attrition. One of the best ways to track customer retention and engagement is to provide strong predictor of customer return on investment (ROI) through customer retention and engagement measures. A strong predictor of ROI gives managers an idea of which retention and engagement strategies are working and which need to be changed. These strategies could include updating policies and technology, creating an environment of continuous improvement, streamlining internal procedures and practices, implementing new metrics in place, or aligning future objectives with past objectives. In all of these cases, changing a policy or procedure is not cost-effective, but providing strong predictors of customer return on investment can help managers evaluate if it is necessary.
If a company wants to know how to increase retention and employee engagement, they should also closely monitor turnover and attrition. A good measure of turnover is the number of people who leave a company every year. This number is easily influenced by an existing trend toward exit, which companies can control through effective training, motivating employees, offering benefits, or changing other variables. An effective retention strategy will focus on recruiting and hiring experienced leaders, developing a work environment that is diverse, rewarding, and fun, and providing incentives for high performance.
A key strategy for improving customer retention and customer engagement involves understanding customer wants, expectations, and their motivation for purchasing. Understanding customer behavior is especially critical for smaller businesses that must compete with larger competitors. While size may not make a difference, the current mix of products and services may not be enough to retain customers. Smaller companies must understand that to increase retention and customer engagement, they need to offer more than a larger company could. Customers want value and quality, even when it costs them money. Building a customer base by offering a comprehensive product and service package is an excellent way to increase retention and engagement.
The first step to understanding retention and employee engagement is to understand why employees leave a company. There are several common reasons employees quit a company, including boredom, lack of direction, poor working conditions, bad boss/employee relations, and a negative climate. Many of these problems can be solved by increasing employee retention and improving employee welfare and participation. One of the best ways to improve conditions and make employees happy is to provide an effective work environment through an organized, competitive work environment.
Another important factor in customer retention and engagement is customer satisfaction or perceived value of products and services. If customers perceive value in a product or service, they will return and recommend the company to others, increasing customer retention. Companies must provide a significant benefit to potential customers in order to have high retention rates. A good example of a customer service enhancement can be providing training, information on products and services, or discounted products and services for returning customers to maintain customer loyalty and engagement.
Resume reviews are often conducted to identify strong candidates for retention or induction into new positions. Employee evaluation surveys are also a valuable tool for identifying strong candidates for retention or induction. A strong predictor of success in retaining staff can be determined by conducting surveys that collect data on key factors related to retention. A good measure of a company’s progress in retaining staff includes the ratio of employees who leave the company vs. those who remain (commonly called attrition). Statistics such as this provide valuable insights into what aspects of the business need the most attention to increase retention and how these factors relate to the management style and vision of the company.
In addition to feedback from current employees, hiring and development programs can provide informal feedback or evaluation system for the employer to assess progress in retaining employees. This evaluation can provide a wealth of information for the HR department to learn about its current or past success in retaining employees. This informal feedback can help HR determine where gaps are currently weak and develop training or other initiatives to help close these gaps. It can also identify areas that could use some additional attention to increase retention and motivation among employees. These evaluations can be combined with formal feedback from a customer satisfaction survey of other employees to identify areas for future improvement.