Retention and employee experience are two sides of the same coin. Here’s a quick story: In one of my previous roles at a different company, a new senior leader came on and laid off half of our department. Those of us remaining were in shell shock. We knew this happens at companies all the time. But little was done to alleviate the fears of those who remained (and had a lot more work on their plates) and the culture seriously suffered. I started looking for a new job almost immediately and accepted an offer a few months later. The day before I was going to give my notice, my manager started a discussion about compensation but for me, it was too little, too late. And for most people, money can’t make up for a negative work experience.
My story is not unique, which is why retention remains a serious issue for HR and business leaders. This article is the first in a series on findings from the new SHRM/Globoforce Employee Recognition Survey (sent to nearly 800 HR professionals).
The first finding is:
The top three workforce management challenges faced by organizations today are retention/turnover, engagement, and recruitment.
This is the second consecutive year that retention tops the list of HR challenges – cited by nearly half of the organizations surveyed (46%). Keeping talent from leaving companies has nearly doubled as a concern over the years, with only 25% of organizations listing it as a top challenge when we started the survey in 2012.
The job market today is unrecognizable compared to only a few years ago. We know this because the Bureau of Labor Statistics publishes data on the ratio of unemployed persons per job opening. The ratio peaked at 6.6 in 2009 and has been steadily declining ever since. In September 2016, the ratio was 1.4. A few years ago, workers may have tolerated a less than satisfactory experience at work for the sake of job security. Today they don’t have to.
What’s more, retention has very real financial implications. A recent Bersin by Deloitte report estimates that companies lose more than $100,000 for every employee who leaves; this doesn’t even include indirect costs such as lost client relationships, institutional knowledge, or previous training for the employee leaving.
Here’s an interesting question: When do people typically leave organizations? Brian Kropp from CEB says, “We’ve learned that what really affects people is their sense of how they’re doing compared with other people in their peer group, or with where they thought they would be at a certain point in life. We’ve learned to focus on moments that allow people to make these comparisons.”
For example, CEB has found that job-hunting activity increases by 6% during work anniversaries. Why not consider a more human approach to celebrating service anniversaries – one that reminds people how much impact they’ve made in the organization?
Celebrating anniversaries is just one way of creating a positive work experience. How do you keep that going all year? The new Employee Experience Index from Globoforce and IBM captures the core facets of a positive employee experience, including:
Belonging – feeling part of a team, group, or organization
Purpose – understanding why one’s work matters
Achievement – a sense of accomplishment in the work that is done
Happiness – the pleasant feeling arising in and around work
Vigor – the presence of energy, enthusiasm, and excitement at work
Based on the survey of more than 23,000 employees in 45 countries, people who score highly on the above facets are 53% less likely to intend to leave their organizations.
So we know experience is directly linked to retention, but how do you create that positive experience? According to the Index, one of the top drivers is feedback, recognition, and growth. When employees agree that they receive recognition when doing good work, 83% report a more positive employee experience, vs. only 38% when they do not receive recognition.
Sarah Payne writes for Globoforce, where she supports the marketing programs team in creating intriguing content for lead generation, presentations, and events. She can be reached at email@example.com.
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