How to Avoid One of the Costliest Mistakes in Business

One of the most expensive mistakes a business owner can make is underestimating the cost of employee turnover. According to a recent study by Gallop, “The cost of replacing an individual employee can range from one-half to two times the employee’s annual salary—and that’s a conservative estimate.” 

Right now may seem like an employer’s market, but that doesn’t mean your best employees aren’t able to find great jobs. According to the Global Workplace: 2023 Report, “51% of currently employed workers say they are watching for or actively seeking a new job.” So, what can you do about it? 

How to Retain Your People 

There are four keys to keeping great team members from leaving your organization. 

1.Invest in their wellbeing. 

The trend of better benefits is not going away. At least 70 percent of employers have enhanced their benefits in the past year. These updates include affordable healthcare, virtual mental health care, expanding PTO, generous parental leave, and more. 

 Employers are also getting creative and offering flexible work environments that allow team members to flex their hours and work remotely. 

 Prioritizing your employees’ wellbeing has been proven to result in increased productivity and reduced turnover. 

2. Connect the dots to your vision. 

It’s easy to assume your people know why their work is important. But if how their contributions contribute to your organization’s vision and mission is not consistently communicated, it’s easy for people to feel like they’re just checking off tasks. 

 You need a written vision for the future of your company and a plan that connects each department’s work to that vision. From there, your leaders can help your team members see how they contribute to your goals and your products or services. 

3. Invest in their future. 

High performers typically don’t like to be stagnant. If they can’t see a growth path for their position, they’ll likely seek it somewhere else. Employers are offering more professional development opportunities for their employees. Investing in your high performers is one more way to ensure they stay and continue to contribute to your business—which also means you continue to benefit from the knowledge they have gained during the time they have already put in. 

4. Keep communication open. 

Ask your team members for feedback. Feedback goes two ways. If you’re offering them coaching to help improve their performance, then asking them to do the same for you builds more rapport and trust. 

 Let your employees know they can come to you, even if they disagree with you. Have open conversations about their job satisfaction and what factors might make them consider leaving. Conduct employee surveys to engage their feedback and see trends among your team. 

 Be sure to recognize them for their hard work and achievements by writing them a note, having annual awards, and giving shoutouts in team meetings.  

Make Your People Want to Stay and Attract Top Talent 

The job market is tumultuous, and the employers who treat their employees with respect and prioritize their wellbeing are attracting the best talent. If you invest in your team members’ futures and stay in touch with your culture, you’ll save a lot of money that would otherwise be spent on turnover. 

If you need help connecting the dots between your vision and mission and your team’s day-to-day work, you will be interested in our Strategic Planning Workshop. Fill out this form more information. 

Sources: 

Matt Mosser, “Half of Your Employees Are Looking to Leave,” Gallup, https://www.gallup.com/workplace/506819/half-employees-looking-leave. 

Brian Bingaman, “The Top Employee Benefits Trends of 2023, Resourceful Finance Pro,” https://www.resourcefulfinancepro.com/articles/the-top-employee-benefits-trends-for-2023.