Protect company valuation by ensuring retention of your key people
Labor challenges are a concern of just about every business owner today. These concerns begin with finding good employees and then once on board, moves to how to retain them. Our finding, more often than not, is the core retention issue relates to culture and less about compensation.
Of course, the amount of money an employee can make working at your business is essential to their decision to join your company and remain with you. But for many businesses, their comp and benefits are market competitive. But what is causing the employee turnover challenge goes beyond comp and benefits and speaks to the culture of the company. And unless the root issue of culture is addressed, throwing money at the situation will only mask an attrition issue short term, but it won’t address the issue longer term.
Here are good questions to discuss with your team relating to employee retention:
- Do our employees feel connected to the greater purpose of why our company exists? Do our employees understand how their job supports the reason our customers work with us?
- Do our employees (especially our key/high potential employees) feel like they are learning and progressing in their roles/careers with our company?
- Do we do a good job of making our employees feel a part of a team, especially now with workers that are remote
- Do we keep our employees updated in terms of what our key business priorities are and how we’re performing overall – or do they feel like they are operating in the dark?
- Do we do a good job as a leadership team of addressing personnel performance issues so that our good performers know that we don’t tolerate weak performers?
- Do our employees feel encouraged to bring forth ideas to help our company strengthen?
- Do we do a good job of monitoring our employee attrition at the department/function level so we know what it is company wide and by specific parts of our company? Meaning your attrition issue, if you have one, might be coming from just one area of your company.
- Do we know what the employee attrition numbers are for those employees that have been with us for less than 1 year versus those with us for longer time?
Bottom line is don’t assume that money is the issue people might be leaving your business. The expression is people vote with their feet and leave companies when they don’t like the culture. Investing time with your team and discussing your culture during these challenging times can help you retain key people and help you protect, even build the long-term valuation of your business.
