Retention ppt

1. 1. RETENTION ISBETTER THENRECRUITMENTBY: SAVITA

2. 2. "A bird in the hand is worthtwo in the bush"
3. 3. What is Retention? Employee retention refers to theability of an organization to
retainits employees.OrEmployee retention refers to thevarious policies and practices
whichlet the employees stick to anorganization for a longer period oftime.
4. 4. What is Recruitment?Recruitment is a process ofsearching for prospectiveemployees
and stimulating themto apply for jobs in theorganization.
5. 5. Why do Employees Leave ? Leave an organization out of frustration Constant
friction with their superiors orother team members. Low salary Lack of growth
prospects Lack of motivation Lack of recognition Lack of teamwork
6. 6. Lack of tools and resourcesExcessive workloadLack of trainingPoor senior
leadershipPoor communicationsPoor management
7. 7. Why is retention soimportant? The Cost of Turnover Loss of Company Knowledge
Disruption of Customer Service Turnover spirals into more turnover
8. 8. Reasons of Retention Existing employeeskills, talents, values, aptitude,
commitmentand contribution is known better based onperformance Potential of new
employee, sometimes, maybe a myth. Existing employees cultural fit is judged
andtested Existing employees aspirations andexpectations are clear.
9. 9. Existing employees has alreadycompleted adjustment stage and is incontributing and
performance stage. Existing employees is aware ofcompany and community
environmentand climate There wont be further cost ofrecruitment, relocation and
training,in case of existing employees.
10. 10. The Advantages of EmployeeRetention Employees are an organizations
intellectualasset that is responsible for the day-to-daybusiness operation. Employee
retention is a financial gain fororganizations. Acquiring Talent Training and
Development Skilled Labor Force Impact on Customer Service
11. 11. Known devil isbetter thanunknownangel

Employee retention
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From Wikipedia, the free encyclopedia

Employee retention refers to the ability of an organization to retain its employees. Employee
retention can be represented by a simple statistic (for example, a retention rate of 80% usually
indicates that an organization kept 80% of its employees in a given period). However, many
consider employee retention as relating to the efforts by which employers attempt to retain
employees in their workforce. In this sense, retention becomes the strategies rather than the
outcome.
A distinction should be drawn between low-performing employees and top performers, and
efforts to retain employees should be targeted at valuable, contributing employees. Employee
turnover is a symptom of deeper issues that have not been resolved, which may include low
employee morale, absence of a clear career path, lack of recognition, poor employee-manager
relationships or many other issues. A lack of satisfaction and commitment to the organization can
also cause an employee to withdraw and begin looking for other opportunities. Pay does not
always play as large a role in inducing turnover as is typically believed. [1]
In a business setting, the goal of employers is usually to decrease employee turnover, thereby
decreasing training costs, recruitment costs and loss of talent and organisational knowledge. By
implementing lessons learned from keyorganizational behavior concepts, employers can improve
retention rates and decrease the associated costs of high turnover. However, this isn't always the
case. Employers can seek "positive turnover" whereby they aim to maintain only those
employees whom they consider to be high performers.
Contents
[hide]

1Cost of turnover

2Herzberg's theory

3See also

4Retention Programs

5Retention Tools and Resources

6Join, Stay, Leave Model

7Employee Retention Best Practices

8Outsourcing Employee Retention Program

9References

10External links

11See also

Cost of turnover[edit]
Studies have shown that cost related to directly replacing an employee can be as high as 50
60% of the employees annual salary, but the total cost of turnover can reach as high as 90
200% of the employees annual salary.[2] These costs include candidate views, new hire training,
the recruiters salary, separation processing, job errors, lost sales, reduced morale and a number
of other costs to the organization. Turnover also affects organizational performance. Highturnover industries such as retailing, food services, call centres, elder-care nurses, and
salespeople make up almost a quarter of the United States population. Replacing workers in
these industries is less expensive than in other, more stable, employment fields but costs can still
reach over $500 per employee.[3]

Herzberg's theory[edit]
An alternative motivation theory to Maslows Hierarchy of Needs is the MotivatorHygiene (Herzbergs) theory. The theories have overlap, but the fundamental nature of each
model differs. While Maslows Hierarchy implies the addition or removal of the same need stimuli
will enhance or detract from the employees satisfaction, Herzbergs findings indicate that factors
garnering job satisfaction are separate from factors leading to poor job satisfaction and employee
turnover. Herzbergs system of needs is segmented into motivators and hygiene factors. Like
Maslows Hierarchy, motivators are often unexpected bonuses that foster the desire to excel.
Hygiene factors include expected conditions that if missing will create dissatisfaction. Examples
of hygiene factors include bathrooms, lighting, and the appropriate tools for a given job.
Employers must utilize positive reinforcement methods while maintaining expected hygiene
factors to maximize employee satisfaction and retention. [4]

See also[edit]

Occupational health psychology

Equity theory in business

Retention Programs[edit]
It is important to first pinpoint the root cause of the retention issue before implementing a
program to address it. Once identified, a program can be tailored to meet the unique needs of
the organization. A variety of programs exist to help increase employee retention. [5]
Career Development It is important for employees to understand their career path within an
organization to motivate them to remain in the organization to achieve their personal career
goals. Through surveys, discussion and classroom instruction, employees can better understand
their goals for personal development. With these developmental goals in mind, organizations can
- and should - offer tailored career development opportunities to their employees.
Executive Coaching Executive coaching can be used to build competencies in leaders within
an organization. Coaching can be useful in times of organizational change, to increase a leaders
effectiveness or to encourage managers to implement coaching techniques with peers and direct
reports. The coaching process begins with an assessment of the individuals strengths and

opportunities for improvement. The issues are then prioritized and interventions are delivered to
target key weaknesses. Assistance is then provided to encourage repeated use of newly
acquired skills.
Motivating Across Generations - Todays workforce includes a diverse population of employees
from multiple generations. As each generation holds different expectations for the workplace, it is
important to understand the differences between these generations regarding motivation and
engagement. Managers, especially, must understand how to handle the differences among their
direct reports.
Orientation and Onboarding An employees perception of an organization takes shape during
the first several days on the job and continues throughout their first six months, with 90% of
employees still deciding whether or not to stay at the organization during this time. [6] It is in the
best interest of both the employee and the organization to impart knowledge about the company
quickly and effectively to integrate the new employee into the workforce. In addition, providing
continual reinforced learning through extended onboarding over the first year can increase new
hire retention by 25%.[7] By implementing an effective onboarding process, new hire turnover
rates will decrease and productivity will increase.
Womens Retention Programs Programs such as mentoring, leadership development and
networking that are geared specifically toward women can help retain top talent and decrease
turnover costs. By implementing programs to improve work/life balance, employees can be more
engaged and productive while at work.[8]
Exit Interview and Separation Management Programs

Retention Tools and Resources[edit]

Employee Surveys By surveying employees, organizations can gain insight into the motivation,
engagement and satisfaction of their employees. It is important for organizations to understand
the perspective of the employee in order to create programs targeting any particular issues that
may impact employee retention.
Exit Interviews By including exit interviews in the process of employee separation,
organizations can gain valuable insight into the workplace experience. Exit interviews allow the
organization to understand the triggers of the employees desire to leave as well as the aspects
of their work that they enjoyed. The organization can then use this information to make
necessary changes to their company to retain top talent. Exit interviews must, however, ask the
right questions and elicit honest responses from separating employees to be effective.
Employee Retention Consultants An employee retention consultant can assist organizations in
the process of retaining top employees. Consultants can provide expertise on how to best
identify the issues within an organization that are related to turnover. Once identified, a
consultant can suggest programs or organizational changes to address these issues and may
also assist in the implementation of these programs or changes.[9]

Join, Stay, Leave Model[edit]

For organizations and employers, understanding the environment is the first step to developing a
long-term retention strategy. Organizations should understand why employees join, why they
stay and why they leave an organization. This join, stay, leave model is akin to a three-legged
stool, meaning that without data on all three, organizations will be unsuccessful in implementing
a proper retention strategy.
Why employees join- The attractiveness of the position is usually what entices employees to join
an organization. However, recruiting candidates is only half the problem while retaining
employees is another. Understanding what your employees are looking for in the job while
simultaneously making sure your expectations are correct are both important factors to address
in the hiring process.[10] High performing employees are more likely to be retained when they are
given realistic job previews. Organizations that attempt to oversell the position or company are
only contributing to their own detriment when employees experience a discord between the
position and what they were initially told. To assess and maintain retention, employers should
mitigate any immediate conflicts of misunderstanding in order to prolong the employees
longevity with the organization. New-hire surveys can help to identify the breakdowns in trust that
occur early on when employees decide that the job was not necessarily what they envisioned. [11]
Why employees stay- Understanding why employees stay with an organization is equally as
important to understanding why employees choose to leave. Recent studies have suggested that
as employees participate in their professional and community life, they develop a web of
connections and relationships. These relationships prompt employees to become more
embedded in their jobs and by leaving a job; this would sever or rearrange these social networks.
The more embedded employees are in an organization, the more they are likely to
stay.http://www.shrm.org/templatestools/toolkits/pages/managingforemployeeretention.aspx Addi
tionally, the extent to which employees experience fit between themselves at their job, the lesser
chance they will search elsewhere. Organizations can ascertain why employees stay by
conducting stay interviews with top performers. A stay survey can help to take the pulse of an
organizations current work environment and its impact on their high performing employees.
Employers that are concerned with over-using stay interviews can achieve the same result by
favoring an on-going dialogue with employees and asking them critical questions pertaining to
why they stay and what their goals are.[1]
Why employees leave- By understanding the reasons behind why employees leave,
organizations can better cater to their existing workforce and influence these decisions in the
future. Oftentimes, it is low satisfaction and commitment that initiates the withdrawal process,
which includes thoughts of quitting in search of more attractive alternatives. If administered
correctly, exit interviews can provide a great resource to why employees leave. Typically,
employees are stock in their responses because they fear being reprimanded or jeopardizing any
potential future reference.[11] The most common reasons for why employees leave are better pay,
better hours and better opportunity. These typical answers for leaving, often signal a much
deeper issue that employers should investigate further into. By asking relevant questions and
perhaps utilizing a neutral third party provider to conduct the interview, employers can obtain
more accurate and quantifiable data. Contrary to what most organizations believe, employees
often leave due to relationships with manager and/or treatment of employees and not
compensation, as this is often a response that employees are uncomfortable expressing to their

organization directly.[11] Retention Diagnostic is a rapid benchmarking process that identifies the
costs and can help uncover what affects employee loyalty, performance and engagement. [12]

Employee Retention Best Practices[edit]

By focusing on the fundamentals, organizations can go a long way towards building a highretention workplace. Organizations can start by defining their culture and identifying the types of
individuals that would thrive in that environment. Organizations should adhere to the fundamental
new hire orientation and on boarding plans. Attracting and recruiting top talent requires time,
resources and capital. However, these are all wasted if employees are not positioned to succeed
within the company. Research has shown that an employees first 10 days are critical because
the employee is still adjusting and getting acclimated to the organization. Companies retain good
employees by being employers of choice.
Recruitment- Presenting applicants with realistic job previews during the recruitment process
have a positive effect on retaining new hires. Employers that are transparent about the positive
and negative aspects of the job, as well as the challenges and expectations are positioning
themselves to recruit and retain stronger candidates. [1]
Selection- There are plethora of selection tools that can help predict job performance and
subsequently retention. These include both subjective and objective methods and while
organizations are accustomed to using more subjective tools such as interviews, application and
resume evaluations, objective methods are increasing in popularity. For example, utilizing
biographical data during selection can be an effective technique. Biodata empirically identifies life
experiences that differentiate those who stay with an organization and those who quit. Life
experiences associated with employees may include tenure on previous jobs, education
experiences, and involvement and leadership in related work experiences. [1]
Socialization- Socialization practices delivered via a strategic onboarding and assimilation
program can help new employees become embedded in the company and thus more likely to
stay. Research has shown that socialization practices can help new hires become embedded in
the company and thus more likely to stay. These practices include shared and individualized
learning experiences, activities that allow people to get to know one another. Such practices may
include providing employees with a role model, mentor or trainer or providing timely and
adequate feedback.[1]
Training and development- Providing ample training and development opportunities can
discourage turnover by keeping employees satisfied and well-positioned for future growth
opportunities. In fact, dissatisfaction with potential career development is one of the top three
reasons employees (35%) often feel inclined to look elsewhere. if employees are not given
opportunities to continually update their skills, they are more likely to leave. Those who receive
more training are less likely to quit than those who receive little or no training. Employers that
fear providing training will make their employees more marketable and thus increase turnover
can offer job specific training, which is less transferable to other contexts. Additionally, employers
can increase retention through development opportunities such as allowing employees to further
their education and reimbursing tuition for employees who remain with the company for a
specified amount of time.[1]

Compensation and rewards- Pay levels and satisfaction are only modest predictors of an
employees decision to leave the organization; however organizations can lead the market with a
strong compensation and reward package as 53% of employees often look elsewhere because
of poor compensation and benefits. Organizations can explicitly link rewards to retention (i.e.
vacation hours to seniority, offer retention Bonus payments or Employee stock options, or define
benefit plan payouts to years of services)[13] Research has shown that defined compensation and
rewards as associated with longer tenure. Additionally, organizations can also look to intrinsic
rewards such as increased decision-making autonomy.
Effective Leaders- An employees relationship with his/her immediately ranking supervisor or
manager is equally important to keeping to making an employee feel embedded and valued
within the organization. Supervisors need to know how to motivate their employees and reduce
cost while building loyalty in their key people. Managers need to reinforce employee productivity
and open communication, to coach employees and provide meaningful feedback and inspire
employees to work as an effective team.[14] In order to achieve this, organizations need to prepare
managers and supervisors to lead and develop effective relationships with their subordinates.
Executive Coaching can help increase an individuals effectiveness as a leader as well as boast
a climate of learning, trust and teamwork in an organization. to encourage supervisors to focus
on retention among their teams, organizations can incorporate a retention metric into their
organizations evaluation.
Employee Engagement- Employees who are satisfied with their jobs, enjoy their work and the
organization, believe their job to be more important, take pride in the company and feel their
contributions are impactful are five times less likely to quit than employees who were not
engaged. Engaged employees give their companies crucial competitive advantages, including
higher productivity and lower employee turnover.

Outsourcing Employee Retention Program[edit]

Turnover costs can have significant negative impact on a companys performance. Turnover cost
can represent more than 12 percent of pre-tax income for the average company and nearly 40
percent for companies at the 75th percentile for turnover rate.[15] Organizations and managers
understand the importance of implementing an effective retention program but arent proactive in
implementing one and often leave it for another day. That day hardly ever comes. Organizations
that dont have the time or have limited resources can outsource employee retention programs to
specialists. Companies can hire third party specialists to pinpoint the root causes of their
workforce challenges. By identifying the root causes, customized action plans can be tailored to
fit your organizations need to and create a retention program customized to your organization.
Another benefit of outsourcing is that organizations can get quantifiable justifying the actions
needed to improve their organization.

What is Employee Retention ?

Employee retention refers to the various policies and practices which let the employees stick
to an organization for a longer period of time. Every organization invests time and money to groom
a new joinee, make him a corporate ready material and bring him at par with the existing employees.
The organization is completely at loss when the employees leave their job once they are fully trained.

Employee retention takes into account the various measures taken so that an individual stays in an
organization for the maximum period of time.

Why do Employees Leave ?

Research says that most of the employees leave an organization out of frustration and
constant friction with their superiors or other team members. In some cases low salary, lack of
growth prospects and motivation compel an employee to look for a change. The management must
try its level best to retain those employees who are really important for the system and are known to
be effective contributors.
It is the responsibility of the line managers as well as the management to ensure that the employees
are satisfied with their roles and responsibilities and the job is offering them a new challenge and
learning every day.
Let us understand the concept of employee retention with the help of an example:
Misha was a talented employee who delivered her best and completed all her work within the desired
time frame. Her work lacked errors and was always found to be innovative and thought provoking.
She never interfered in anybody elses work and stayed away from unnecessary gossips and
rumours. She avoided loitering around at the workplace, was serious about her work and no doubts
her performance was always appreciable. Greg, her immediate boss never really liked Misha and
considered her as his biggest threat at the workplace. He left no stone unturned to insult and
demotivate Misha. Soon, Misha got fed up with Greg and decided to move on.
Situation 1 - The HR did not make any efforts to retain Misha and accepted her resignation.
Situation 2 - The HR immediately intervened and discussed the several issues which prompted Misha
to think for a change. They tried their level best to convince Misha and even appointed a new boss to
make the things better for her.
Situation 1 would most likely leave the organization in the lurch. It is not easy to find an employee who
gels well with the system and understands the work. Hiring an employee, training him and making him
fit to work in an organization incur huge costs and thus sincere efforts must be made to retain the
employee. Every problem has a solution and the management must probe into the exact reasons of
an employees displeasure. Employees sticking to an organization for a longer time tend to know the
organization better and develop a feeling of attachment towards it. The employees who stay for a
longer duration are familiar with the company policies, guidelines as well as rules and regulations and
thus can contribute more effectively than individuals who come and go.
Employee retention techniques go a long way in motivating the employees for them to enjoy
their work and avoid changing jobs frequently.