The Role of Recruitment and Retention in Strategic Management

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April 4, 2017
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The Role of Recruitment and Retention in Strategic Management

By Cynthia Deaton

With a national unemployment rate of 4.7% and the job outlook for many occupations increasing at a rate of 10% or better in the coming years, it is imperative for your organization to consider recruitment and retention strategies.

Employers should find that their most valuable assets are the skills, expertise, and resources of their workforce. Without the workforce, most businesses would cease to exist. These strategies are why recruiting and retaining the best employees can only improve the value of your organization. Within just a few years we have seen employers go from having their pick of top candidates, to desperately trying to fill open positions with available people.

In addition to the value your employees contribute to your team, there is a substantial cost to turnover. Employee turnover expenditures include much more than the amount of placing an ad on a recruitment website. Some of the hidden expenses include administrative time, lower productivity, training, client loyalty, lost knowledge, overtime and an overworked remaining staff. The turnover amount is unique to each business and industry, but many case studies have shown that the loss of an employee earning $40,000.00 or less could average at least 20% of their salary. This amount increases significantly, up to 40% for the loss of managers or individuals in a leadership position. Consider that replacing ten median income individuals could cost an employer $80,000.00 to $160,000.00 annually!

Retention strategies start with the recruitment process. Employees are more inclined to stay with an organization that sets realistic expectations and fulfills the promise made before the offers extended. It is human nature to try to sell your candidates on why they should come to work for your company, but it is imperative, the full expectations of the position are understood before applying. Share the job description with the applicant. Organizations that inform candidates of the right job duties, advancement opportunities, and true earning potential are more likely to attract candidates that will commit to your organizational goals and perform better. In short, set accurate and realistic expectations and fully disclose these to the potential employee.

How you onboard your new employee establishes the tone for their entire work experience with your company. The process starts before they join your team. Announce the incumbent to your staff and share details about the new hire and what they will bring to your organization. Help your employees connect with the new individual before they even start. Let your team know what your expectations are for onboarding the incumbent and their involvement with this process.

Create a structured schedule for the first day. It should not be up to your new hire to figure out what to do, or where to jump in. No matter how busy or short staffed you are, your new hire should never enter your company with a sink or swim mentality. A simple schedule for the first day could involve completing new hire paperwork, conducting orientation, reviewing the rules and expectations, having a welcome lunch and starting the initial training.

Communicate with your new employee before their first day and involve them in the onboarding process. Call or send an email to your new employee with an outline of what their first day will entail. An understanding of what to expect can alleviate the first day jitters and be the initial step in making the new hire feel welcomed.

Set your expectations from the onset and never assume the new employee will figure it out on their own. It does not mean you hand someone your employee handbook to read at their leisure. No matter if it is the employee’s first job, or they are an experience professional, they need to learn about your expectations and the uniqueness of your business culture. The foundation of this process is the employee’s job description, which they should be given on their first day. Take time to review specific acronyms and functions that are unique to your business. Also, you need to consider the rules and expectations that go beyond the scope of their position. You cannot hold anyone accountable for adhering to your expectations if they do not fully understand what they are.

Proper training is an essential tool for success. Consider, would you want to have a heart transplant performed by a doctor who is not board certified? This may be an extreme example, but the same principle applies to every position. Have you ever had a waiter who didn’t know the menu, a stylist that poorly cut your hair or a mechanic who couldn’t repair your car? While it is easy to say that training is an investment in time and money for your organization, it is still substantially less expensive than the cost of losing quality employees. While you may have hired a highly knowledgeable employee, most people have some weakness in some areas of their skills. Training can help develop these areas of weakness into strengths which enhance better productivity in your employees. Employee success is a success for your organization.

Commitment on your part will ensure your new hire receives the training necessary and understands the expectations to be successful in their position.

Take time to meet with your new hire, both formally and informally. Create an open-door culture, so your new hire feels comfortable approaching you to discuss any needs for development. Conduct structured performance reviews with your new hire at 30 and 90 days. Don’t wait until an annual review to discuss successes and areas of necessary improvement. Having a strong performance management process means improving performance. Employees learn what they did right, and employers learn how to coach them to even higher levels of success. This process translates to improved morale, a happier workplace, and higher profits.

Lastly, have fun. Have you ever heard the term that a happy employee is a productive employee? Studies have shown the productivity of an employee, and professional fulfillment is directly linked.

An enjoyable work environment can lead to better customer service, improved initiative, and better employee loyalty. Take time to create a culture that encourages satisfaction in the workplace and the rewards will be yours to reap.

DNet Video — A short video on Pinnacle’s upgraded online portal for clients and their employees.