Employee Retention involves taking measures to encourage employees to remain in the organization for the maximum period of time

. Corporate is facing a lot of problems in employee retention these days. Hiring knowledgeable people for the job is essential for an employer. But retention is even more important than hiring. There is no dearth of opportunities for a talented person. There are many organizations which are looking for such employees. If a person is not satisfied by the job he’s doing, he may switch over to some other more suitable job. In today’s environment it becomes very important for organizations to retain their employees. The top organizations are on the top, because they value their employees and they know how to keep them glued to the organization. Employees stay and leave organizations for some reasons. The reason may be personal or professional. These reasons should be understood by the employer and should be taken care of. The organizations are becoming aware of these reasons and adopting many strategies for employee retention.

They are not the ones who don’t have good opportunities in hand. Employees today are different. Relationship 5. Compensation 2. If they don’t. Support 4. It is the responsibility of the employer to retain their best employees. Compensation packages vary from . they switch over to the next job. A good employer should know how to attract and retain its employees. Compensation: Compensation constitutes the largest part of the employee retention process. they would be left with no good employees. Growth 3.WHAT IS EMPLOYEE RETENTION: Employee retention is a process in which the employees are encouraged to remain with the organization for the maximum period of time or until the completion of the project. The employees always have high expectations regarding their compensation packages. Retention involves five major things: 1. Environment. As soon as they feel dissatisfied with the current employer or the job. Employee retention is beneficial for the organization as well as the employee.

So an attractive compensation package plays a critical role in retaining the employees. bonuses. . While setting up the packages. It includes o o o o Basic wage House rent allowance Dearness allowance City compensatory allowance Salary and wages represent the level of skill and experience an individual has. benefits.industry to industry. Compensation includes salary and wages. leave travel concession. prerequisites. And this increase should be based on the employee’s performance and his contribution to the organization. Economic benefits: It includes paid holidays. Bonus: Bonuses are usually given to the employees at the end of the year or on a festival. vacations. etc. etc. the following components should be kept in mind: Salary and monthly wage: It is the biggest component of the compensation package. bonuses. stock options. Time to time increase in the salaries and wages of employees should be done. It is also the most common factor of comparison among employees.

It also shows the employee that the organization cares about the employee and its family. After retirement: It includes payments that an Employee gets after he retires like EPF (Employee Provident Fund) etc. If an employee can not foresee his path of career development in his current organization. Growth: Growth and development are the integral part of every individual’s career.Long-term incentives: Long term incentives include stock options or stock grants. The important factors in employee growth that an employee looks for himself are: Work profile: The work profile on which the employee is working should be in sync with his . etc. legal assistance etc). there are chances that he’ll leave the organization as soon as he gets an opportunity. These incentives help retain employees in the organization's startup stage. use of a company cars. Miscellaneous compensation: It may include employee assistance programs (like psychological counseling. It saves employees money as well as gives them a peace of mind that they have somebody to take care of them in bad times. Health insurance: Health insurance is a great benefit to the employees. discounts on company products.

individual meetings. Organizations can not keep aside the individual goals of employees and foster organizations goals. Many employers fear that if the employees are well rained. The profile should not be too low or too high. Organization should not limit the resources on which organization’s success depends. . Personal growth and dreams: Employees responsibilities in the organization should help him achieve his personal goals also. Employees’ priority is to work for themselves and later on comes the organization. he’ll not be able to contribute in organization growth.capabilities. These trainings can be given to improve many skills like: • • • Communications skills Technical skills In-house processes and procedures improvement related skills C or customer satisfaction related skills Special project related skills • • Need for such trainings can be recognized from individual performance reviews. If he’s not satisfied with his growth. Training and development: Employees should be trained and given chance to improve and enhance their skills. they’ll leave the organization for better jobs.

employee satisfaction surveys and by being in constant touch with the employees. counseling services. Supervisor should support his subordinates in a way so that each one of them is a success. Employers can also support their employees by creating an environment of trust and inculcating the organizational values into employees. Employers can also provide valuable feedback to employees and make them feel valued to the organization The feedback from supervisor helps the employee to feel more responsible. Thus employers can support their employees in a number of ways as follows: . childcare services. Management can support employees by providing them recognition and appreciation. Top management can also support its employees in their personal crisis by providing personal loans during emergencies. GROWTH: Lack of support from management can sometimes serve as a reason for employee retention. employee assistance programs. Management should try to focus on its employees and support them not only in their difficult times at work but also through the times of personal crisis. confident and empowered.

It leads to less satisfaction and eventually attrition. This decreases employee’s interest and he becomes demotivated. A supportive work culture helps grow employee professionally and boosts employee satisfaction. Respect for the individual: Respect for the individual is the must in the organization. the management should keep the following points in mind. This bitterness could be due to many reasons. Relationship with the immediate manager: A manger plays the role of a mentor and a coach. To enhance good professional relationships at work. It is his . The management is sometimes not able to provide an employee a supportive work culture and environment in terms of personal or professional relationships. He designs ands plans work for each employee. There are times when an employee starts feeling bitterness towards the management or peers. By providing feedback  By giving recognition and rewards  By counseling them  By providing emotional support Relationship: Sometimes the relationship with the management and the peers becomes the reason for an employee to leave the organization.

etc. Promote an employee based culture: The employee should know that the organization is there to support him at the time of need. educational courses. availability of resources. not only among teams but in different departments as well. Deliver what is promised. Employees should know what the organization expects from them and what their expectation from the organization is. Otherwise he’ll feel useless and will be dissatisfied. certifications.duty to involve the employee in the processes of the organization. This will induce competition as well as improve the relationships among colleagues. open door policy. Individual development: Taking proper care of employees includes acknowledgement to the employee’s dreams and personal goals. So an organization should hire managers who can make and maintain good relations with their subordinates. Create opportunities for their career growth by providing mentorship programs. . Relationship with colleagues: Promote team work. Show them that the organization cares and he’ll show the same for the organization. Recruit whole heartedly: An employee should be recruited if there is a proper place and duties for him to perform. etc. An employee based culture may include decision making authority.

Organizations should focus on managing the work environment to make better use of the available human assets. Try to make the current employees stay instead of recruiting new ones. employee retention will take care of itself. People want to work for an organization which provides  Appreciation for the work done  Ample opportunities to grow  A friendly and cooperative environment  A feeling that the organization is second home to the employee Organization environment includes • • • • Culture Values Company reputation Quality of people in the organization .Induce loyalty: Organizations should be loyal as well as they should promote loyalty in the employees too. ENVIRONMENT: It is not about managing retention. It is about managing people. If an organization manages people well.

Work life balance includes: o o o o o o • Flexible hours Telecommuting Dependent care Alternate work schedules Vacations Wellness • Work environment: It includes efficient managers. involvement in decision-making. .• • • • Employee development and career growth Risk taking Leading technologies Trust Types of environment the employee needs in an organization • Learning environment: It includes continuous learning and improvement of the individual. supportive co-workers. Support environment: Organization can provide support in the form of work-life balance. clarity of work and responsibilities. challenging work. certifications and provision for higher studies. etc. and recognition.

Interruption of Customer Service: Customers and clients do business with a company in part because of the people. training costs and productivity loss). the investment is not realized. industry experts often quote 25% of the average employee salary as a conservative estimate. IMPORTANCE OF EMPLOYEE RETENTION: The process of employee retention will benefit an organization in the following ways: . The environment should be such that the employee feels connected to the organization in every respect. Often much time and money has been spent on the employee in expectation of a future return. Relationships are developed that encourage continued sponsorship of the business. customers. While it is difficult to fully calculate the cost of turnover (including hiring costs. When an employee leaves. Loss of Company Knowledge: When an employee leaves. he takes with him valuable knowledge about the company. When the employee leaves. the relationships that employee built for the company . The Cost of Turnover: The cost of employee turnover adds hundreds of thousands of money to a company's expenses. current projects and past history (sometimes to competitors).Lack or absence of such environment pushes employees to look for new opportunities.

And even after this you cannot assure us of the same efficiency from the new employee . Co-workers are often required to pick up the slack. then good amount of time is lost in hiring a new employee and then training him/her and this goes to the loss of the company directly which many a times goes unnoticed. Higher retention rates motivate potential employees to join the organization. Regaining efficiency: If an employee resigns. Goodwill of the company: The goodwill of a company is maintained when the attrition rates are low. The unspoken negativity often intensifies for the remaining staff. the effect is felt throughout the organization.are severed. Turnover leads to more turnovers: When an employee terminates. which could lead to potential customer loss.

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