A company's employees have always been a key asset but today, more and more companies are realizing that their people are by far their most important asset because in a world where technologies, processes, and products are quickly duplicated by competitors, and the pace of change and level of competition are constantly increasing, people are the key to the most reliable sources of advantage—better service, increased responsiveness, stronger customer relationships, and the creativity and innovation that keep a company one step ahead. Now that so much is being done by organizations to retain its employees, why is retention so important? Is it just to reduce the turnover costs? Well, the answer is a definite no. It’s not only the cost incurred by a company that emphasizes the need of retaining employees but also the need to retain talented employees. Companies have now realized the importance of retaining their quality workforce. Retaining quality performers contributes to productivity of the organization and increases morale among employees. Four basic factors that play an important role in increasing employee retention include salary and remuneration, providing recognition, benefits and opportunities for individual growth. But are they really positively contributing to the retention rates of a company? Basic salary, these days, hardly reduces turnover. Today, employees look beyond the money factor. A positive recognition for work boosts the motivational levels of employees. Recognition can be made explicit by providing awards like best employee of the month or punctuality award. Project based recognition also has great significance. The award can be in terms of gifts or money. Every individual is worried about his/her career. He is always keen to know his career path in the company. Organizations can offer various technical certification courses which will help employee in enhancing his knowledge. : A provision of performance linked bonus can be made wherein an employee is able to relate his performance with the company profits and hence will work hard. This bonus should strictly be productivity based. Recreational facilities help in keeping employees away from stress factors. Various recreational programs should be arranged. They may include taking employees to trips annually or bi-annually, celebrating anniversaries, and sports activities. Giving out some gifts at the time of one or two festivals to the employees making them feel good and understand that the management is concerned about them.
Questions
- What are the basic factors in Employee Retention?
- How performance linked bonus can be relate to employee retention?