Employee Retention in the Twenty First Century

The business model in almost every department of modern business has undergone constant change in the past ten years to the point that it has become necessary to step back and review how we do business in all aspects of the company’s life in light of new markets and new ways even our employees do business. This is as true in our HR department as it is in marketing. The labor pool is changing and the impact on the bottom line of the business can be serious if we do not change the way we recruit and offer to retain employees in light of changes to educated labor available ‘offshore’ for drawing based on our staffing needs.

Employee retention and how we approach the concept of employee retention over many years is an area where certain assumptions must be challenged if we are to remain competitive. Some of the assumptions about employee retention that are quickly becoming obsolete include…

  • That there is an unlimited resource of motivated employees out there to meet my recruitment needs.
  • It is a good idea to cycle employees inside and outside the company as this keeps benefits costs low.
  • The “my way or the highway” approach to management is the right way to go to enforce your vision of how work gets done.
  • That employees are commodities. There is always more where they come from.
  • Employees should feel grateful just to receive a salary.
  • It is better to keep young employees and move older employees from the workplace.

The pool of workers changes with changes in the demographics of the country and these changes make these assumptions outdated and dangerous if we expect to retain employees who can provide good support for our business objectives. As the ‘baby boom’ is leaving the market and being replaced by fewer young and less skilled, we have to adjust our expectations in terms of employment and retention.

Perhaps the biggest change we should get used to is to start seeing employees as a valuable asset and paying a lot of attention to retaining them, not just once a year at the time of the performance review but on a daily and weekly basis. The assumption that employees will work with us for a salary and that we can exert influence in the management position because of the large pool of labor we can utilize to replace dissatisfied employees has become a flawed approach to people management.

The truth is that the talent pool is evading at an alarming rate. If you have a team of skilled people that you have invested in to raise their level of knowledge and skills, then it is worth the investment. There is a shortage of skilled and educated employees and, above all, they know they are needed so that they can move from one job to another without difficulty if they become dissatisfied with their current workplace.

These changes in the positioning model justify a company-wide reassessment of retention policies and strategies. The HR department must be at the forefront of changing the company’s attitude toward employees from one of “us against them” to one of employee empowerment and partnership.

The managers who will excel in retaining valuable, productive and trained employees will be those who see the working relationship as a contract in which management has responsibilities to employees to ensure their continued growth and success just as the employee must raise his weight in the company. A partnership approach to management will go a long way towards improving the company’s retention profile which will benefit the business in several ways.

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