Employees are a company’s most valuable asset and finding the perfect candidate for your role is an arduous task, one that takes time and patience. However, once you’ve found the perfect candidate, how can you ensure longevity? For all companies, hiring staff is one of the biggest expenditures but for start-ups this is precious cash. In an increasingly competitive environment and unemployment rates at a 42 year low, employees are in the driving seat so staff retention is one of the most important strategies to implement and execute.
Recognising hard work, keeping an open line of communication and rewarding with company perks are all a good way of keeping staff happy and stopping them from calling quits. If you’re worried that your staff turnover is slowly growing, take a look at these steps to help you out.
Don’t wait until a valued employee’s exit interview to realise that your processes aren’t inspiring your workforce. When someone leaves, you need to remove all sense of stubbornness with comments such as, ‘oh they just weren’t us…’ or ‘they didn’t fit into our culture.’ Instead, take a step back, think about your environment, structure and processes and decide if anything needs to be changed. You want to continuously progress and grow your company with a positive working environment, so listening to your employee’s concerns will help guide you in how you develop as a team. Having meetings with your staff, every six months or so to discuss the good, the bad and the ugly of your company will give you a well-rounded view of how people view you and your business. These meetings never take long but are so important to make sure your employees feel their opinion is valued.
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As you develop as a company, helping your staff grow and learn new skills is a great way to reduce staff turnover. Ask your employees what skills they want to achieve in the long term and investigate how you can help them achieve these goals. You could create a contractual agreement, if you agree to finance their training, they can stay with you for a certain period of time, so you see a direct return on investment. This will motivate your team to achieve their goals with you, rather than on their own, or worse with another company.
Additionally, empowering your staff with opportunities to upskill will reduce the need for hiring new people. As a growing business, hiring new staff is extremely costly, so spending money on courses to upskill your employees will be a short-term cost that generates endless long-term results.
As a start-up, you might not be able to compete with large corporates on providing perks but listening to your staff and providing perks that are purposeful and unique to your company will help with staff retention. Use your connections to get deals on perks that are unusual to set yourself apart from other businesses in your sector. Partner with local shops, coffee shops and businesses in your network that would also benefit from your business. This mutual beneficial relationship will help businesses like yours succeed as well as maintaining great morale in your team.
A great way to incentivise people to remain part of your team long-term is to give them a share of the upside. I always say, think pound signs rather than percentages. A share of the profits, or ownership for the more senior members, can be a great motivator.
Rewarding your original, loyal team members with equity will give them a sense of pride as if it was their own, removing the feeling of a hierarchy and deterring them to leave, giving you more employee security. Providing team members with profit shares based on targets, or even shares in the company will weed out those who are only in the job for a quick pay-cheque. Instead, your team members will be motivated to grow the company, from a start-up to a large successful firm with you. Think outside the box, sometimes staff members may have had some inheritance or other monies they want to invest into you, they may even buy in to get some shares.
There are many different routes to go down when giving staff equity, and something that shouldn’t be taken lightly but when done correctly, it can really work. One important point to note, is that you make sure that you avoid overpromising and underdelivering as this can create a really toxic work environment.
Create the right culture
Ultimately, the most important factor to get right is the company culture. Make sure that you create an environment that inspires open debate and discussion and explicitly shows that you value everyone’s opinion, no matter their position. There is nothing worse than staff feeling unheard and in turn, is one of the leading reasons for quitting. When running a start-up, long hours are expected, and it can get extremely stressful but it’s imperative that you don’t force this upon your staff. Make sure that you create a happy environment that will motivate and drive everyone to succeed, not drive them into the ground.
There are numerous factors to take into consideration when seeking to improve staff retention. As a start-up, money is tight but it’s important to encourage and inspire your staff to grow with your company. Partnering with likeminded companies can give you the opportunity to provide unique perks to reward your staff, which also benefits your relationships in the long term.
Andy Scott is an entrepreneur, property developer and chairman of REL Capital