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Agrimarketing : April 2009
THEIMPORTANCEOFRETENTION The Scoop on Recruiting C ompanies talk about retention and howto retain employees. Leaders develop plans and rewards to keep employees engaged. Butwhat is retention andwhy is it so important? By definition, retention is the process inwhich employees are encouraged to remainwith an orga- nization. Employee retention is bene- ficial to both the organization and the employee. Businesses that have employees that are engaged in their organiza- tion and/or job,which leads to higher retention rates,mighty say things like: “I believe inmy organi- zation’s reputation, products, and services”; “Mymanager doeswhat they say they’ll do”; and “I’mappre- ciated and recognized formy contri- butions.” On the contrary,employees that are disengagedmight say things like: “Mymanager doesn’t care aboutme as a person;” “I’mnot sure howmy performance is beingmea- sured”; and “I feel like I don’t have a goodwork/life balance.” The tricky thing about retention is that organizations very rarely ask the employees questions that lead toward understanding employee engagement and in turn retention.Another factor is thatmost often, especially the negative thoughts, are things employees are thinking and don’t verbally share until it is too late. WHY RETENTION IS IMPORTANT Sowhy is retention so important? There are a lot of reasons. The bene- fits of employee retention to an orga- nization can be linked back to the bottomline—employee retention ensures customer satisfaction, prod- uct sales, satisfied coworkers and reporting staff, effective succession planning and organizational knowl- edge amongst your employees. Turnover is very costly—several Web sites suggest that you can figure 150%of the person’s salary iswhat it costs an organization, up to 200%for managerial level roles. The cost of recruiting for an open position alone gets expensivewhen you consider costs like advertising, interviewer 22 Agri Marketing s April 2009 time, andmany other costs. These things can be assigned a dollar fig- ure, but there are hidden costs that don’t often get figured into the equa- tion, such as lost productivity,cus- tomer dissatisfaction, and lower employeemorale. INDUSTRY IMPACT Another factor thatwe’ll need to consider thatwill impact retention over the next couple of years is expected retirement.According to theOccupationalOutlook Handbook total employment is expected to increase by 15%in 2012, which is an addition of nearly 21 million additional jobs. This is not only in agriculture, but across all sec- tors. Based on research there are about 80million baby boomers and only 50million generation Xers. Therewill be an obvious gap! IMPROVING RETENTION There are a lot of simple things that can be done to improve retention. The first step is to find the right per- son for the organization and the par- ticular job. This can be done through effective recruitment strategies and conducting effective interviews. The next key step after finding the right person ismaking sure to on-board the employee effectively. Remember that on-boarding goes beyond typical administrative tasks and lastsmore than the first day, week ormonth, but rather the employees first full year.Helping the employee understand the impor- tance of their rolewithin the organi- zation and the overall objectives and goals of the company set the stage for employee retention. Alot of time, retention comes down to the leadership ormanager. This is a large topic and something for us to explore in a future issue. Keep inmind though that this plays a role in employee retention and an investment in leadership training for managers isworthwhile. Many feel that salary is the thing that retains employees.While a competitive salary is important, it doesn’t play as large of a role in retention as other items, such as achievement and recognition. Salary is reallymore of a factorwhen it comes to recruitment, not retention. In terms of retention, employees want to knowthat they are con- tributing to the organization and be recognized for their contributions. These don’t cost an organization anything. Finally,many companies that want to focus on employee retention invest on special programs. They can be simple and require littlemonetary investment, such as conducting exit interviews or offering a suggestion box. Or, they can be larger and require an investment, such as gym membership reimbursement or advanced education support. Either way, if you seek input fromemploy- ees for ideas on to improve retention or feedback on improving the orga- nization, be ready to act.Nothing is more demotivating to an employee than providing feedback and then seeing nothing change. Retention programs need to start early.Research shows that the initial excitement of a newjob typically wears off after the first 90 days and engagement drops fromthere. For further information or assistance developing a retention program, contactAgCareers.comat firstname.lastname@example.org. AM Upcoming AgCareers.com EVENTS WesternNAAgHR Roundtable May 4-6, 2009 Monterey, CA IntegratingHispanic Talent into YourOrganization May 8, 2009 Webinar U.S. AgHR Roundtable August 3-5, 2009 Champaign, IL Visit www.AgCareers.com for details
May 2009 Supplement