When your business is just getting started, you can rely entirely on yourself. And when it gets sufficiently large that you can’t do it all, you can hire some people just getting started with their careers or simply in need of opportunities: people who don’t have that many options and are primarily looking to be gainfully employed for a while. But that stage doesn’t last.
If things go well, your business will keep on growing, and it’ll complicate things significantly. Any new roles you devise will require more seniority and expertise, so you’ll have to do more to win people over. Most significantly, though, your early hires will feel emboldened by their success at your company and start to wonder what they could achieve elsewhere.
You could just sit back and let those long-serving employees head to new pastures, reasoning that you can simply replace them, but that would be a major mistake and a sign of dangerous complacency. Employee retention is vital. Those who’ve been at your company for quite some time will know so much about how it operates: how the processes function, where the strengths and weaknesses are, etc. They’ll also be trustworthy, and trust isn’t an easy thing to cultivate.
In this post, we’re going to consider how you can improve employee retention as your business grows, keeping high-value talent around. Let’s get started.
Pay people what they’re worth to you
When you’re shopping for staple goods, you should look to pay as little as you can. Hunting for bargains (and even haggling given the opportunity) is perfectly normal, and no one will think any less of you for it. Taking that attitude into the HR world, though, is a terrible idea — yet it’s something that many business owners make the mistake of doing. They see it as entirely sensible to dish out lowball offers and generally try to extract extra value.
You might wonder what’s so wrong with this. Well, there are two big problems. Firstly, treating your employees dispassionately will encourage them to return the favor by disregarding any notions of loyalty. If it’s clear to them that you want to pay them the bare minimum, they’ll have no compunctions about going elsewhere the moment a better offer arrives.
Secondly, the market rate for a particular role (or even what others would offer your employees in particular) should only set the baseline for what you pay. You can, and should, offer more than that, and you should determine it through considering what a given employee is really worth to you. If someone in a particular position does far more than that position might suggest, you should pay them an amount reflecting that. They will otherwise feel that their effort isn’t being rewarded and think about going elsewhere.
If you’re concerned about affording to pay people based on the value they’re generating, you’re likely wasting money elsewhere. Think about how you can trim your expenses, optimize your business services (use a comparison for business services if you’re unsure), and generally manage your finances more intelligently. Any business that doesn’t pay its employees what they’re worth will struggle to retain them.
Provide opportunities for progression
You may pay well, but are your employee roles growing with your business? People naturally want to develop their positions over the months and years: they want to improve their skills, pick up new responsibilities, and — of course — become more valuable so they can make more money. If you don’t allow roles to expand, your employees will need to leave to seek promotions elsewhere, so it’s vitally important that you don’t make that mistake.
This can be tricky, admittedly. You may have employees who aspire to administrative roles, yet not have any room for such roles. If that happens, the most important thing you can do is make it abundantly clear what the situation is. Look for ways to expand their roles without changing their titles. Give them new tasks on the side, and throw in some extra perks to compensate.
And when you think about what your company might be in five years, factor in employee development so those who stick around know that you’re making an effort to accommodate their preferences. It’s often better to stay working for someone who’ll actually try for you than it is to go somewhere with a position you prefer but a boss who’s largely indifferent.
Request and act upon employee feedback
Lastly, it’s essential that you don’t ignore what your employees actually think and want, particularly because personal preference is unpredictable. One employee might want more responsibility, while another might want less. One might want more variety, while another might want to cut out some extra tasks and focus on their core objectives. You won’t know until you ask — so make it a priority to engage with your employees and request in-depth feedback.
And once you have that feedback, you need to do something with it. If people are getting overly stressed, for instance, you should consider relaxing your expectations and/or finding ways to help them feel better about their work. The more you act on feedback, the more you’ll show that you’re invested in making the company great, and the more your employees will want to stick around to see what you achieve down the line.