The Secret of Employee Retention

Written by Channel 8 News Reno. Posted in Employee retention program, Employee retention project report, Employee retention techniques

Importance of employee retention

The importance of employee retention is manifold. Not only do high employee retention rates indicate that a business is being run well, they also contribute to a smoothly running business. Retaining employees who are already well versed in company policy and procedure means less expenditure of time and money on training and less frequent recruitment and hiring process. There are many employee retention techniques that businesses rely on, most of them are based around the same general principles.

Most retention strategies for employees take Herzberg’s theory into account. This motivation theory is essential to talent retention and bears a striking resemblance to Maslow’s Hierarchy of needs. Also called the Motivator-Hygiene theory, Herzberg’s theory for talent retention implies that the addition or removal of the same need stimuli will either enhance or detract from employee satisfaction. Basically, Herzberg’s findings indicated that the factors contributing to job satisfaction are not the same factors leading to poor employee satisfaction and employee turnover. Herzberg segments his system into two categories: motivators and hygiene factors. Motivators are unexpected bonuses that encourage employees to excel, while hygiene factors include expected conditions that, when absent, will create dissatisfaction. Motivators might include recognition for achievements, opportunity for greater responsibility, or intrinsic interest in the work. Hygiene factors are not necessarily hygienically related, though they could be. They might include job security, salary, fringe benefits, and quality work conditions. Though they, in and of themselves, are not enough to promote talent retention, they will result in high turnover rates when absent.

In practice, Herzberg’s theory can be applied to boost talent retention. There are essentially four possible scenarios:

High Motivation and Hygiene Factors

In this scenario, employees are motivated to stay based on job satisfaction brought about by the presence of motivators. Because hygiene factors are also present, they are not negatively influenced and are likely to remain with a company.

High Motivation, Low Hygiene Factors

This scenario is not common and produces a feeling of conflict for employees. Though they may feel valued and enjoy the work they do, the absence of hygiene factors causes them to consider employment elsewhere.

Low Motivation, High Hygiene Factors

This scenario is also not likely to result in talent retention. Workers do not feel sufficiently motivated to do their jobs well, despite hygiene factors like job security and fringe benefits. They might be motivated to look for employment with another company that provides basic needs as well as job satisfaction.

Low Motivation, Low Hygiene Factors

This scenario results in the lowest talent retention rates and probably in a difficult hiring process. Employees don’t feel motivated to do their work well and have no reason to stay, because hygiene factors are also missing.

In order to experience positive employee retention, companies need to cultivate high motivation while providing hygiene factors readily. Consider the environment of your own company. Which of the four models do you fit? Unless it’s the first, there’s something you can improve to help employee retention.