If you lose a key employee what impact will it have on your business? Don’t you agree that Employee’s are your most valuable asset? So what can you do to retain them and mitigate human capital risk?
Let’s first define “human capital risk.” It is the uncertainty arising from changes in a wide range of workforce and people management issues that affect a company’s ability to meet its strategic and operating objectives. In a recent survey Fortune 100 leaders reported that the top 5 HR risks are:
- Talent management and succession planning
- Ethics and tone at the top
- Regulatory compliance
- Pay and performance alignment
- Employee training and development
Most companies lose talent. Here’s what you can do to prevent it:
Don’t hire out of desperation Do not just hire an employee because you needed someone to fill the position yesterday. That is what temporary employees are for.
Test skills If you want to decrease employee turnover, you should assess skill by testing competencies. This is one of the tools that will help you determine whether you have found the best fit for each position.
Profile behaviors The job description should include more than tasks. You should identify the behaviors of your best employees to ensure you are hiring the right fit.
Pay should be competitive If you’ve gone through the trouble of finding the right person for the job, you want to make sure you can get them to say yes. Benchmarking the jobs and identifying competition for your labor market is an essential prerequisite.
Say Thank You Encourage your employees by saying thank you and telling they are doing a good job. Conduct regular performance reviews. When management communicates with employees they feel more involved and appreciated.
Conduct exit interviews When an employee leaves it is very helpful to know the cause of why the employee chose to leave. Knowing what problems to address, and taking action on them, will eventually reduce turnover.
Start by measuring turnover Benchmark the cost of turnover against industry competitors. Then calculate the cost of replacing and training new employees to show the dollars saved and the cost that could have been avoided by turnover.
Determine where to focus retention efforts You should identify groups of employees whose ability to achieve would significantly impact your organization. What would be the cost of to your organization if you lost critical knowledge through attrition?
Change your recruiting strategies Focus on groups or individuals in key roles. Identify the skill gaps and the behaviors that make them essential to your organization. Conduct a job analysis and write job descriptions that match your best talent.
Conduct a salary survey Identifying similar occupations in your labor market area. Identify what your competition is paying. Ask your employees why they stay? Analyze job satisfaction studies to determine what is motivating them. It may not be money, but you need the answer to retain top talent.
Finally, use a strategic approach to aligning employees with business. Identify the best behaviors for engagement. Weigh the gaps between talent capabilities and business goals. Address your selection/staffing process and the compensation and incentives paid. Don’t let valuable employee age out or jump ship for a dollar. Put strategies into play to reduce turnover for your organization.
If you need help, contact us.