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Employee Turnover and Retention Strategies - Essay Example

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Employee Turnover and Retention Strategies

Every department, be it operations, finance, human resources, or sales and marketing, must invest in motivating, training, and retaining their best human resources to make a difference through their core competencies. As Susan Heathfield said: "Managers readily agree that retaining your best employees ensures customer satisfaction, product sales, satisfied co-workers and reporting staff, effective succession planning and deeply imbedded organizational knowledge and learning."
Today organisations are willing to look upon their staff not so much as employees or workers but as 'knowledge workers'. As Peter Drucker observed, "while the more than fifty-fold increase in productivity of the manual worker was the greatest achievement of the 20th century manager, the most important work of the 21st century is to increase the productivity of the knowledge worker." (Pottruck and Pearce, 131). The more competent workers your company or organisation loses, the more will it set your clock back in finding and training suitable replacements at much greater costs. In the meantime your loss becomes your competitor's gain, which again has adverse implications on the success of your operations.
Among the major causes that propelled employees to quit an organisation, the following conditions mostly relating to work culture have been identified as contributing to employee dissatisfaction and consequent exit:
Lack of clarity in company policies, practices, and procedures
Excessive controls and autocratic leadership
Bureaucratic work environment with lack of trust
Inadequate remuneration and unjustified cost cuts
Poor quality of supervision
Lack of opportunities for growth
Absence of facilities for training and development
Lack of scope for utilization of skills and talents
Poor communication (with the employee not knowing what is expected of him daily)
Lack of rewards, recognition and encouragement
Unfair and inequitable treatment of employees
Overbearing attitude and threatening by supervisors
The Case of Solution's
Solution's began operations on a small scale in 1967 as a recruitment agency for social care specialists. Headquartered in London, Solution's expanded in a big way in four decades to establish itself as the largest social care agency in the UK, with 160 employees spread over18 branches. The year 2004 proved to be a disappointment for the company in terms of financial performance, compelling it to slash commissions given to consultants for recruitment mostly in branches located in London. The weak performance also resulted in the retrenchment of up to 15 branch administers, apart from the voluntary exit of many employees who signed up with rival agencies. An analysis showed that the major cause for high employee turnover (91%) in 2004 was the cost reduction strategy adopted by the company. With a view to putting the operations back on rail, the company opted for a change of leadership at the top.
A new managing director joined the board in January 2005 with a mission to improve the health of the company in general and the turnover situation in particular. He believed that the key to success through increased sales lay in ensuring employee satisfaction. Accordingly he straightway set about implementing certain remedial and innovative measures for a ...Show more


This paper attempts to analyse the major causes of employee turnover and recommends solutions for employee retention in light of organisational policy and practices. The success story of Solution's, a social care agency that demonstrated winning strategies for enhancing the retention rate, is also discussed to illustrate the points.
Author : aileen49
Employee Turnover and Retention Strategies essay example
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