Employee turnover is more than just a minor business hassle; it can have significant, widespread effects. It has the potential to diminish team morale, reduce efficiency, and tarnish a company’s brand image, all of which can be expensive to rectify. To tackle these issues, companies must reevaluate how well their organisational objectives align with the needs of their employees.

High staff turnover can feel like an insurmountable challenge, but it’s one you can conquer. At MyPeople, we’ve cracked the code, but before diving into our game-changing strategies, let’s explore the broader picture: employee retention.

What is Employee Retention?

Employee retention measures how well a company holds onto its employees over time. Typically calculated annually, an 85% retention rate means that 85% of employees stayed with the organisation throughout the year. While some industries and roles naturally experience higher turnover, maintaining robust employee retention is crucial for keeping top talent and cutting down on the exorbitant costs of replacements.

The Impact of High Turnover

Financial Blow

High turnover isn’t just a headache; it’s a financial drain. Research reveals the cost of employee turnover can vary depending on the role and industry, but ranges from 0.5 to 2 times an employee’s annual salary. In the UK, the average cost of replacing an employee is around £25,000, but this can increase to £40,000–£100,000 for specialist and Senior positions. C-level positions are even higher, up to 213% of their salary, not to mention factoring in job board fees, recruiter fees, interview/admin hours, and training expenses.

Productivity Loss

When employees leave, they take their expertise and experience with them. According to Allied’s Workforce Mobility survey, it can take a year or longer for new employees to reach the productivity levels of their predecessors. Employees coping with the departure of their colleagues often experience a decline in morale also, leading to disengagement. Research has shown that disengaged employees are 15% less profitable than their engaged counterparts, this productivity gap can severely hamper your organisation’s momentum.

Cultural Disruption

High turnover disrupts company culture. Departures create uncertainty and can prompt remaining staff to question their own roles. Building strong, genuine bonds among employees takes time, and high turnover can erode these relationships, leading to more exits and a diluted culture.

Research shows that the average employee retention rate in the UK is around 80%. Whether your rate is higher or lower, having data-driven insights that accurately illustrate what’s happening in your organisation, is the first step towards making improvements.

The Power of Data

Reducing employee turnover starts with a clear, data-driven assessment of your current situation. Skip the guesswork and turn to solid metrics. Workforce attrition and employee turnover frequently stem from a lack of alignment between employees and business objectives. When business leaders and human resources fail to coordinate effectively, it leads to an organisation where conflicting priorities, fragmented efforts, and dispersed resources greatly diminish both potential ROI and the employee experience. In such a misaligned organisation, employees often feel detached from the company’s goals, uncertain about their roles, and are more likely to seek a more unified work environment elsewhere.

Strong alignment is a foundation for building robust retention strategies, bolstering employee loyalty, and maximizing a workforce’s ROI. To recalibrate alignment, we have to look closely at employee retention, alignment’s role in employee engagement, and the ways to synchronize what workers want with what businesses need.

Achieving Alignment for Employee Retention

When alignment is attained, companies create a stable and consistent work environment, which promotes a positive workplace culture and supports organisational development. Alignment also fosters loyalty and dedication among employees, resulting in increased job satisfaction, productivity, and sustained profitability. It’s crucial to recognise that alignment is not a one-off effort but a continuous process. Keeping a workplace where employees feel appreciated and aligned with the organisation’s mission and vision necessitates ongoing assessment and adaptation. When employees believe in the company’s overarching goals and view their contributions as significant, they are more inclined to stay committed to their roles.

Tips to Combat High Staff Turnover

Tackling high turnover requires strategic, proactive measures. Here are some tips to kickstart your retention revolution:

Hire the Right Talent

One of the biggest drivers of turnover is hiring the wrong people. Focus on predictive hiring metrics to ensure you’re selecting candidates who are not only qualified but also committed to staying and thriving. At MyPeople, we leverage behavioural science and data to identify the best fit talent for your organisation.  We offer solutions that will help identify the best talent to fit into different teams and micro cultures across your organisation.

Align with the Mission

Ensure candidates resonate with your organisation’s mission and culture. Understanding the distinct dynamics between talent and the environment in which they’ll thrive. Employees who fit well within the company culture are more likely to stay with the organisation long-term, reducing turnover rates and associated hiring costs.  Those aligned individuals will be motivated and driven to perform (our research suggest up to 28% more productivity from a motivated workforce).

Match Values and Team Dynamics

When hiring, it’s crucial to assess how well potential employees align with your company’s core values and team dynamics as well as the micro-cultures created within the individual teams. New hires who share your organisation’s values, and those of the managers they work, are more likely to feel connected and committed. Additionally, considering team dynamics ensures that new employees can integrate smoothly, fostering collaboration and cohesion from day one.

Enhance Onboarding and Training

Leverage data to identify individual characteristics, traits, and work or learning preferences, to shape future onboarding plans and ongoing development needs. A stellar onboarding process helps new hires integrate smoothly and become productive faster. Continuous training keeps them engaged and sharpens their skills.

In Conclusion

High staff turnover can be daunting, but with the right strategies, you can turn the tide. By focusing on hiring the right candidates, aligning them with your mission and values, ensuring they’re compatible within the team(s) you deploy them, and fostering a supportive environment, you can dramatically boost employee retention. At MyPeople, we’ve perfected a method that helps organisations retain their top talent and reduce turnover. Discover how we can help by signing up for a free demo today.

Elevate retention strategies to unlock your workforce’s full potential.