Some managers utilize strategies like sales incentive programs and employee reward and recognition programs to foster employee engagement.
Some managers utilize strategies like sales incentive programs and employee reward and recognition programs to foster employee engagement. Not only are engaged workers generally more productive and innovative, they're also more likely to be happy with their jobs – and will probably stick around longer. Unfortunately, recent studies have revealed that organizations are struggling to retain high-potential workers.
Retention saves money and bolsters talent
Having high employee turnover isn't cheap. Not only do companies have to invest in recruiting, hiring and training new workers, they also have to deal with a short-handed staff and loss of knowledge resources, which can impact overall team morale and inspire other employees to leave. A quick glance at a few numbers indicates how urgently businesses should be refining their retention strategies:
- Fifty-five percent of high-potential employees leave their organizations within 5 years, despite businesses spending $3 million on leadership and development programs, reported CEB, a leading member-based advisory company.
- Corporations lose an average of $14,000 for every position that stays open longer than three months, a CareerBuilder survey found, according to Baseline Magazine.
- Twenty-two percent of business respondents to the same survey said that prolonged job vacancies caused additional employees to seek career opportunities elsewhere.
- Aetna estimates that the cost of replacing an employee is as high as 93 percent of his or her annual salary, with other analysts placing those expenses at 200 percent, GoSmallBiz reported.
Decreasing turnover by increasing engagement
CEB noted that pouring money into professional development for employees who leave within a few years basically amounts to grooming them for the competition. One way to mitigate this problem is to better identify the "high-potential" workers that businesses select for educational and leadership opportunities. The source suggested measuring potential objectively through talent assessment resources. Employee reward program technology can assist this effort by providing managers with metrics about workers' performance.
Additionally, CEB explained that it's important to consider engagement when investing in employees. Beyond asking for workers to make a commitment in return for professional development activity, managers can proactively gauge engagement levels and use strategies like reward programs to bolster workers' passion for their teams throughout the organization. These strategies can help companies benefit from the investment they make in their top workers, while also avoiding the other negative effects of turnover. By creating a system in which workers feel like they can thrive and be rewarded for their efforts, supervisors help increase job satisfaction while motivating better performance.