The business world is currently facing a really difficult economic environment and many people are wondering about how to keep their key people. So here are my top 10 tips on doing just that.

These tips for retaining your best staff are based on experiences with clients at Amplify HR, and discussions with employees. It’s also based on research from organisations like Workday, Employment Hero, McKinsey and Boston Consulting Group. 

1.  Check the Market

Cost of living pressures mean that employees are currently very keen to make sure they are paid correctly. We’re seeing this in many research surveys at the moment, for example Workday reported that people quit when they can’t discuss their pay, not necessarily when they’re not paid enough. 

That is a really important insight, and we’ve seen it in our work at Amplify HR as well. Employees want to have some transparency around how pay rates are decided, the process for pay increases. 

‘people quit when they can’t discuss their pay, not necessarily when they’re not paid enough’

You need to have a salary review process in place where you check the market rate for roles in your business. If you were to try to hire that role tomorrow, what would it cost you? There are lots of free online tools that you can use to check what those roles are worth. 

You can also look across your own business to check the relativities between your people. If you have two people who are equally valuable to you and the responsibilities in their jobs are about the same, are you paying them the same amount? 

This is really important, particularly because of the changes that started in 2022 making it an offence to have pay secrecy clauses enacted in your employment contracts. We’re going to see more employees talking to each other about their pay. They’ll be wondering, why is that person earning more than me? Or in some cases, why is that person earning less than me when they’re worth the same as I am?

You need to have a process and a policy for determining salaries and salary increases. And these need to be as transparent as possible. 

2. Listen

These 10 retention tips are based on leading practice developed through research and our own experiences at Amplify HR. But they are your employees. It is really important to understand what your people want. And the way to do that is to set up listening mechanisms. 

Sometimes I hear from business leaders that say, ‘Well, I have an open-door policy, anybody can come to me.’ But that’s not enough, because people aren’t always comfortable making the approach. Instead, we should have structured listening mechanisms:

• Staff satisfaction engagement surveys Conducted at least yearly. 
• Monthly one-on-ones between managers and team members These are not just weekly work meetings, they are focused on how the employee is feeling, including challenges or barriers. 
• Quarterly review process These are looking at performance, but also at development. You should be looking at what the employee is missing from the workplace, or what they are enjoying in the workplace so you can make sure you’re leveraging the best experience for them. 
• Roundtables (aka skip-level meetings) Depending on the size of your organisation, you may have meetings where employees meet with their manager’s manager. This is a really valuable way to learn things like:
  • Why do people work here? 
  • Why do they leave? 
  • Why do they stay? 
  • What are we doing well? 
  • What aren’t we doing well? 

‘Sometimes I hear from business leaders that say, “Well, I have an open-door policy, anybody can come to me.” But that’s not enough.’

There’s nothing more valuable than listening to what people say about why they work in your business, what they do and do not like. There’s no research in the world, and no seminar that you can attend that is going to give you these answers about your own business. It’s really important to set up listening mechanisms in your workplace.

3. Be Clear on Culture

When you’re listening to your employees, you can also use the information you gain to give you a picture of your culture, including what it is now, and what you want it to be. If you’re not intentional with your culture, it can really slide into dysfunction without you noticing. You may have experienced this before if you have hired someone in the past who was ‘a really bad hire’ and infected the entire organisation for a long time. 

Culture is a slippery slope sometimes and it is not set-and-forget. You need to think about what you want your culture to be. You need to think beyond, ‘we want to have a great culture’;  everybody says that. But what are the components of the culture you want to have? And what are the components that you have right now?

These might be things like:

• Kind
• Open
• Friendly
• Fast-paced
• Purpose-driven
• Customer-centric
• Performance-driven 

A word of warning on performance culture, though. This is overused, and for many employees, when you say ‘performance-driven’, they hear ‘sweatshop’. They think ‘that’s an organisation that’s going to grind me into the ground’. 

‘for many employees, when you say “performance-driven”, they hear “sweatshop”.’

Think about the words you want to use to define your culture. This is important because these become the lens you use to retain people. You may have your purpose, your mission and your values, and you may say, these define our culture. But who are the people that meet those cultural expectations, and what kinds of people do we need to hire to fit into this type of culture?

Once you can express what your culture is, you can state it clearly, in your job ads and interviews. It then becomes a magnet to people that thrive in your kind of culture, and a filter for those that don’t. 

4. Develop Your Managers

I’ve very deliberately used the word ‘managers’ here, not ‘leaders’. We’ll get to leaders, but first, we need to look at managers. Research from Gallup shows that managers can account for up to 70% of the variance in employee engagement scores. In other words, people do not leave their jobs, they leave their managers. Managers play a vital role in organisations and they have a massive impact on your workplace culture. 

When you have managers in your business, you must make sure that you are investing in their ongoing development as managers. They must have the basics right, including how to:

• manage leave
• employ people under the right conditions 
• manage performance
• have difficult conversations. 

Once you have those basics, then you can start the leadership training. If you’re going straight into leadership training, and you’re not doing manager training, you are missing a huge opportunity. 

5. Provide Flexible Ways to Work

PWC has reported that some of the key things people are looking for in their workplaces are flexibility, autonomy and the right technology. 

Flexibility is not just about working from home, it is also about the days and the times that employees are working. For example, it might mean they can start late if they need to, or they don’t need to get permission for a dentist appointment. The question then becomes, how do we put guidelines in place in the organisation, and implement the technology to support it?

I’ve spoken to business leaders in the last couple of years who said, ‘We don’t want to have guidelines or policies, we just want people to do whatever they want to do’. But then the employees are saying, ‘We don’t have a guideline, we don’t have a policy. We don’t know what’s allowed and what’s not. It’s not consistent. Why does that person get to do things that I don’t get to do?’

You don’t need to have a lot of red tape. But it is better to have written guidelines about the way you work. 

6. Reward and Recognise

A recent report from Employment Hero said the key trend for 2023 is companies investing more in rewards and recognition. There’s plenty of research around this, including one report that showed almost 70% of employees said they would work harder if they feel like their efforts are better appreciated. Another study published by Forbes found that two-thirds of employees say they would quit if they didn’t feel appreciated, and that actually jumps to 76% for millennials. 

There’s a lot of research about the best way to recognise employees showing that it is best when it is:

• Personal
• Differentiated
• Specific
• Timely

So you should have different recognition for different employees for different achievements. Have a look at my post on the Pros and Cons of Employee of the Month for more on this.

7. Upskill

Another piece of research from Workday suggests that people leave when they don’t see a path for personal development. This data shows that nine months before someone quits, they start to show a decline when asked questions relating to their ongoing development. That’s when employees feel that:

• their growth is stalled
• they’re not able to grow professionally
• they don’t have a career path
• they’re not in a job that enables them to learn and develop new skills
• they don’t have a manager who’s encouraging development. 

It’s fascinating that a full nine months before they quit, their engagement data starts to decline. There’s another report from Capterra, around remote work that looks at how larger businesses are increasing their spending on learning and development, whereas smaller businesses under 100 employees are saying they’re keeping their spending the same.

To me, this suggests that if you’re a smaller business, and you’re competing with larger businesses that are paying higher salaries and also increasing the development of their employees, it’s going to be really difficult for you to retain key people. They may be getting calls from recruiters saying, ‘Hey, do you want to come over here for an extra $20,000, and we have career paths, upskilling programmes, and ways to develop you.’

It can be difficult to have career paths in smaller organisations, but it’s not impossible. You do need to think about how you are upskilling, and if you don’t have an upskilling programme in place, now is the time. For more on this, check my previous post, 8 Easy, Inexpensive Tips for Upskilling Employees in Small Business.

8. Invest in Wellbeing 

Financial wellbeing is rising to the top of many employees wish lists in 2023. It’s not a surprise, with many people’s mortgages going up well above where they thought they would be. There are things you can do for your employees around financial wellbeing, including offering seminars or other educative resources. You can talk to your superannuation provider and see what they can provide, even if it’s a pre-recorded webinar, to give to your employees.

Outside of that, you can look at overall wellbeing. If you don’t have an employee assistance provider (EAP), then perhaps it’s time to look at developing one this year. Choose one that’s proactive, that goes beyond reactive solutions like counselling sessions. 

9. Define Career Paths

Career paths are about upskilling, but upskilling taken a step further. You’re showing employees how upskilling develops into a career path. 

You can start this process even in smaller organisations, by having development ladders, for example, levels within roles that show how staff can go from level one to level two to level three. You can also offer mentors to your staff and that can show that while you’re here, we’re going to give you what you need to be able to build your career. 

You’re saying to your employee, even if your career ultimately isn’t with us, we’re going to help you to get there. This will help you to retain them for longer. It sounds counterintuitive, but if someone doesn’t feel like they’re developing a career path with you, they will leave sooner.

10. Develop Your Leaders

Earlier I talked about manager training, and how it’s important to get back to basics. But you also need to look at development and feedback mechanisms to evaluate how your managers are doing as leaders.

I’ve seen plenty of examples of people managing the way that they were managed, which may be five, 10, 15 or 20 years ago. The workplace is changing at such a rapid pace, we’ve got five generations in the workforce at the same time. What was considered perhaps good, ordinary, maybe even great management decades ago may now be completely antiquated and not motivating for your teams at all. 

This is why you need to have continual development. Employees are looking for a two-way relationship. They want to be accepted as adults and as humans in the workplace. They want leaders who understand that they’re self-motivated, they want to feel valued, trusted, listened to and appreciated, and to feel like they belong. 

You should be doing leadership training long before someone ever takes on a management role because you can be a leader in the business without being a manager. It’s really important to get that basis in place within the organisation. 

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