What is a retention strategy

A retention strategy is an organizational plan to retain existing employees by improving employee morale, job satisfaction, and employee engagement.

Most employee retention strategies focus on improving the workplace environment, company culture, benefits, rewards and recognition, and professional development.

Benefits of implementing a retention strategy

An employee retention strategy can do more than reduce voluntary employee turnover and attrition:

• Saves your organization time and money by developing current employees instead of hiring and training new employees

• Enhances your company culture by maintaining a stable environment where employees can foster long-term work relationships

• Helps teams stay productive by retaining top talent and avoiding disruptions caused by training and onboarding new employees

• Reduces employee burnout by providing workers with paid time off and implementing regular one-on-one check-ins to mitigate workload overwhelm

• Increases employee motivation and job satisfaction by enabling career growth and professional development

Examples of effective employee retention strategies

Effective employee retention strategies focus on five factors that improve the employee experience. Depending on your organization, you may need to use all of these strategies to improve your employee retention, or only a few.

1. Upgrade your work environment: Create a more efficient and enjoyable office space that reflects your team’s preferred working style. For example, introduce flexible work setups so employees can work at their desks or in a common area with colleagues, or offer flexible schedules and remote work options

2. Build a stronger company culture: Poor company culture can drive away your best employees. Focus on improving workplace relationships between leadership and employees, increasing transparency by communicating openly, and hosting social events so employees can get to know each other on a personal level

3. Provide modern benefits packages and perks: Offer a comprehensive benefits package that includes healthcare coverage, dental coverage, and retirement contributions, as well as perks that encourage employee well-being and work-life balance. Examples include paid time off, wellness programs, mental health initiatives, a public transport allowance, and memberships to gyms and co-working spaces

4. Reward and recognize hard work: Show employees you value their hard work and skills by rewarding them with monetary gifts, physical gifts, or an experience of their choice. Recognition comes in many forms, from private messages of congratulations to public displays of gratitudes in company-wide meetings

5. Offer professional development opportunities: Continue to provide top performers with challenging work and growth opportunities so they don’t get bored or restless in their roles. First, develop individual career paths for employees to identify career growth opportunities within the company. From there, you can help them hone their skills by providing personalized training, a development allowance or reimbursements for related courses and classes, or enrolling them in an internal mentorship or coaching program

How to design an employee retention strategy

Employee retention strategies should be designed as a preventative measure in order to avoid high turnover rates. Here’s how to get started:

1. Gather feedback from your current employees. Conduct pulse surveys to gain insight into what employees believe would improve their experience at the company

2. If you’ve experienced high employee attrition, you can use what you learned from departing employees to build your retention strategy. Review exit interviews from previous team members to identify common issues and areas of improvement

3. Using your employee feedback and guidance from human resources, design your retention strategy focusing on the improvements that will make the most significant impact on employee satisfaction

4. Introduce new initiatives to the team and provide support as needed. If you’re introducing new benefits programs, mentorships, or rewards and recognition incentives, provide employees with clear documentation on how to use them

5. In your onboarding process, highlight the initiatives, programs, and offerings you’ve developed so new hires know what incentives are available to them

6. Review your employee retention strategy annually—along with your organizational data on employee attrition, satisfaction, engagement, and retention—and make adjustments as needed