One of the best indicators of success is the growth of your organization. Growth not only in terms of revenue or the amount of clients you have, but also in the number of employees on staff. It only makes sense that as your business grows, you’re going to need more team members to handle the additional responsibilities.
Employee recruitment and retention are major challenges that many employers and HR teams struggle with. For instance, these days employees are increasingly demanding a more balanced work life and aren’t willing to sacrifice everything for their careers. Lifelong employment with one organization is no longer the core desire. Instead, they’d rather continue to search for the best pay, benefits, and culture & work environment.
Whether times are changing (like a sudden shift to remote work) or you just want to make sure your own strategies are up to par, reviewing your HR and compensation plan is always worth it. That way you ensure you’re doing all you can in terms of recruitment and retention. This guide will walk you through the following:
- Employee Recruitment and Retention: FAQ
- Employee Recruitment and Retention Myths
- Best Practices for Employee Recruitment and Retention
On top of managing day-to-day tasks and tracking long term goals, leaders like you need to keep the best & brightest employees and attract the same from the outside. Let’s begin.
Employee Recruitment and Retention: FAQ
To start off, we’ll be answering some of the frequently asked questions on employee recruitment and retention:
Both employee recruitment and retention are important to the growth and success of your organization or business. However, there’s no point in recruiting new team members if you can’t keep your current ones. In the big picture of business success, employee retention of skilled talent is more important.
Many organizational leaders turn to talent management tools to help facilitate their recruitment plan. The right recruitment strategy will require plenty of thought behind it and should be backed up by data in your talent management solution. Whoever you recruit will become a part of your team, so it’s crucial that you aim for top talent.
Employee retention is another important function of HR and describes the number of employees you retain year over year (or any other specific period of time). Jobs with a higher retention rate often point to happier and more satisfied employees.
Your HR team should be careful to consider what will go furthest to retain employees, especially in regards to your compensation plan. How you compensate employees, both directly and indirectly, is a huge factor into whether they continue (and grow) in their roles. Many HR consultants recommend taking a Total Rewards Approach to your compensation plan.
Both employee recruitment and retention are important to the growth and success of your organization or business. However, there’s no point in recruiting new team members if you can’t keep your current ones. In the big picture of business success, employee retention is more important.
Aim to keep a balance between your employee recruitment and retention efforts. In many cases, retaining your employees is more beneficial and cost-effective than trying to constantly acquire new ones. That’s because exhausting your resources to find new staff won’t really be worth it if they don’t stay for a long enough time to add value to your team.
Employee recruitment is vital to ensure that your organization grows. However, that doesn’t mean you should be asking just anyone to join your team. Not only is a dedicated and well planned recruitment strategy critical to reaching out to the right people and finding the best candidates, it can also ensure that they are excited to join your team and properly onboarded.
Once you recruit and hire the right prospects, it’s then time to retain them. High employee retention rates are a solid testament to just how great working for your organization is. This not only results in motivated and hardworking employees but also rewards your organization with a positive and attractive reputation.
5. What are some common employee recruitment and retention challenges?
Recruiting and retaining employees is no walk in the park. Here are some common challenges that employers and HR leaders often face:
- Developing fair pay and compensation. It’s hard balancing all the factors of a fair compensation plan, especially if you’re not sure which benefits are best and how to calculate pay. Our article on employee compensation may offer some guidance.
- Not finding the best fit for your organization. Recruitment efforts and resources can go wasted if you end up never finding the “best fit” for your organization. This might be because your job descriptions need adjustments or you’re not looking in the right places.
- People keep leaving under similar patterns. Do you find team members often leaving after one year? If retaining your employees becomes a consistent issue, it’s worth it to find out what that specific driving force might be. Consider implementing an exit interview process.
6. What are the key components of an employee recruitment and retention strategy?
In order to attract and retain top employees, make sure your own strategy addresses these four key components:
- Effective internal management. Without an organized internal structure with clear distinctions as to who manages who, it’s certainly difficult to work on both recruiting and retaining employees. After all, no one is going to want to join an organization when they have no idea how any of its internal processes work. In addition, those managers must communicate frequently with their staff, to build a positive working relationship and share necessary information.
- Career development opportunities. An effective way to retain employees is to offer various career development and advancement opportunities. This can come in the form of training or coaching sessions to help individuals advance in their roles. Intertwining these opportunities in your work culture is also a top recruitment tool! This way prospects know that your organization is invested in them for the long run.
- Work-life balance programs. Employees these days are looking for a balance of work and life, so ensure you have specific programs pertaining to that. For instance, having a detailed paid time off plan as well as a schedule of fun work cultural events—both in-person and virtual—can show employees and prospects that you genuinely care about their wellbeing.
- Strong compensation & recognition programs. When your employees do hard work, it’s imperative that you recognize their contributions, particularly during times of economic disruption. Otherwise, they might take their talents elsewhere. Incorporate compensation and recognition programs such as sales-based incentives and as hoc rewards to ensure you don’t miss out on someone’s big achievement.
Organizations that pay attention to these components have a better chance of attracting and retaining the talent required to remain competitive in the marketplace.
Employee Recruitment and Retention Myths
Because employee recruitment and retention are such hot topics in the world of human resources, there are often many myths that leaders have to address every day when executing their duties. It’s important to be aware of these misconceptions so that you don’t risk derailing your own employee recruitment and retention efforts.
These myths include the following:
- Myth: People most often leave for more pay.
- While research shows that most people do not leave a job for more money, very low-income workers will leave for more money in order to make ends meet. Others use pay to express a perception of unfairness in how the organization values their contributions. More often than not, the deciding factor on whether an employee chooses to stay or not can be based on the indirect forms of compensation that are offered.
- Myth: Productivity-based incentive programs produce long-term impacts and improved morale.
- Studies show that carrot-and-stick motivation programs do not pay off with long-term employee retention. Employees want a chance to learn and grow in the job, perform meaningful work, collaborate with good supervisors, and receive appreciation for a job well done.
- Myth: Employees do not want more responsibility.
- Employees are not looking for more work, but are looking for opportunities to grow and develop their skills. Employees want to try new things, to feel skillful, and to experience personal satisfaction that comes from higher levels of achievement.
- Myth: Loyalty is dead.
- Employees want greater work-life balance as well as the opportunity to make higher contributions to the success of the organization. Employees express loyalty when given the opportunity to better serve customers and when given more learning opportunities.
- Myth: Improving employee satisfaction is expensive.
- Research tells us that employees cannot be bought. Employees want a manager who listens and responds to employees’ ideas, supervisors who support people’s growth & initiative, organizations that provide more training in how to do jobs better, and effective, positive co-worker relationships. Meeting these needs does not have to be an expensive undertaking. It simply requires more thought and care behind each compensation plan and engagement strategy.
- Myth: Employee satisfaction is fluff.
- Studies show that lower turnover and greater satisfaction levels have a positive impact on customer satisfaction & organizational financial success.
- Myth: Supervisors are the problem.
- Supervisors today on average have more staff reporting to them than in the past, yet the amount of training provided to supervisors is minimal. The root issue of underperforming supervisors may rest more with the organization than the supervisors themselves.
- Myth: My organization’s employees are different.
- Don’t skimp out on a compensation or benefit program because you think your employees just “don’t need it.” Most employee issues & needs are universal and not dependent upon industry or geographic location.
Employee recruitment and retention are crucial to the success of your organization, so it makes sense that there’s a lot of noise around the topic. Make sure to keep these misconceptions in mind and not fall into common pitfalls.
Best Practices for Employee Recruitment and Retention
In order to plan the best employee recruitment and retention strategy, it can be helpful to turn to other experienced leaders.
According to research conducted by Dr. Jim Harris and reported in his book Getting Employees to Fall in Love With Your Company, there are five principles embraced by the best-run companies in America, including Walt Disney, Southwest Airlines, Marriott, and Ben & Jerry’s.
These principles are as follows:
- Capture the Heart. The highest achievable level of service comes from the heart. The organization that reaches its people’s hearts will provide the very best service. Organizations that help employees balance work and life demands, inject fun into the workplace, and create compelling visions of how they contribute to the organization’s success capture the hearts of their employees.
- Provide Open Communication. Employees are more loyal when they feel connected to the organization. Successful organizations encourage their employees to ask questions of their supervisors regarding the business and to have them involved in critical business decisions.
- Create Partnerships. Many of these organizations create partnerships by sharing financial numbers with employees, both in good times and bad, and by linking incentive compensation programs to both individual and team performance.
- Drive Learning. These organizations require employees to develop their skills to perfection and ask their employees to learn something new every day. A number of these organizations make available industry-specific reading material and provide in-house seminars, allowing employees work time to develop their skills.
- Promote Employee Action. These organizations understand that to increase employee loyalty and retention, they must go beyond traditional empowerment programs. Rather, they give employees the freedom to succeed. A rule at many of these organizations is to use your good judgment at all times.
These five principles can help guide you when you’re thinking about your own recruitment and retention practices. Using these principles, we also brainstormed our own best practices that organizations should follow when wanting to recruit and retain key employees:
- Pay attention to top employees to make sure they are being developed, rewarded, and recognized for their contributions. Develop a reputation for this in the industry to attract future talent.
- Build and maintain relationships with top employees, so that departure from the organization will be a personal and very difficult decision for the employee. Top employees also will share this sense of belonging with potential new employees.
- Increase confidence and hope among employees through a participative vision and strategy. Engage your employees. Develop a reputation as an open organization that really listens to employees and their ideas.
- Build loyalty, commitment, and trust, so that employees offer these back to the organization.
- Create clear communication pathways so employees always learn important information first hand.
- Invest in dedicated talent management software to help you organize your recruitment and retention processes.
Your employees are the heart of your organization. With the right tools and best practices in mind, you’re sure to attract top talent and implement programs and benefits that make them stay for the long run.
Your organization’s employee recruitment and retention efforts stem from a lot of other HR processes and tasks. For instance, how you compensate team members and facilitate employee engagement are essential components of HR and can directly impact employees’ experiences when joining and staying on your team.
To expand your research, we recommend exploring these additional articles:
- Employee Compensation: Everything you Need to Know. Employee compensation is a driving factor in attracting top prospects as well as retaining them for the long run. This guide will walk you through everything you need to know, from how to measure fair compensation to how to take a Total Rewards Approach.
- HR Consulting Firms for Small Businesses: 15 Leading Experts. For more dedicated help on your overall HR strategy, working with an expert consultant may be your best bet. Read this article to find our top 15 choices.
- Talent Management Software | 12 Top Providers & Buyers Guide. We mentioned how talent management software can really bring your recruitment and retention processes to the next level. To learn more, check out our complete guide to the basic features and tools you should look for.