Importance of Employee Retention During a Recession

Only available on StudyMode
  • Download(s) : 261
  • Published : December 5, 2010
Open Document
Text Preview
Importance of Employee Retention During a Recession

Introduction

During a recession companies have to constantly protect and plan for financial attacks from increased expenses, decreased sales as well as customer and especially employee retention. Management must realize that their employees are suffering just as their businesses are with increased expenses and costs for everyday items. All parties must work cohesively to transition through a down economy. Employers must be aware that their employees will be looking for other employment if the company is not providing the tools time and training in order for them to perform their jobs well. This is especially important during recessionary times when the focus needs to be on customer and employee retention. Numerous studies have found and experts agree that “company culture” is the leading factor in employee satisfaction and retention. Companies must embrace the importance of employee retention through the implementation of various retention practices so that they will be better prepared to continue to grow and be successful even through recessionary times. Companies that grasp that concept and incorporate an environment where employees feel empowered, motivated and engaged will result in greater productivity and teamwork and therefore greater customer loyalty. Company Culture

Company culture and in several instances lack of a positive company culture appears to be the leading factor in the retention ratio of employees remaining versus voluntarily leaving a company. The culture of a company is defined by many different aspects. Organizations that focus on employee retention and management programs have found some surprising indications. Employee retention has been a challenge for all companies big and small and across industry lines. Many have researched and studied the reasons why some companies have better retention rates than others similar. Many experts agree that a basic foundation of proven retention and management skills being implemented and used effectively will result in a higher retention rate. The consensus of decades of research has found that “high retention has little to do with formal programs and everything to do with culture” (Duggan, 2010). Companies that aim to make sure theirs is a company that values its most valuable asset, its employees. Years of analysis on employee retention and human resource directives have shown that an environment where employees are valued assets and treated as such as well as one where talent has been developed with the proper tools, time and training show higher retention levels over time in any economic environment. “Among those who strongly agreed that they work for a manager who cares about their well-being, 94 percent said they intend to stay with their current employer. Of those who strongly disagreed that their manager cared about their well-being, just 43 percent planned to stick around” (Ryan, 2010).

A well known gem known among informed and effective management is that employees do not leave companies they leave bad managers. With this knowledge companies should be able to make sure their focus and goal should be to ensure that their company and its management is effective, dependable and respected leaders. This focus in the long run will ensure there is a positive company culture that will allow them to maintain their most valued asset.

Importance of Solid Human Resource Practices
The human resource department should take the lead when implementing policies,

disciplining employees and layoffs or terminations within a company and especially during a

down economy. The human resource department can ensure that policies are implemented

smoothly and within legal guidelines. They are there to ensure that company policies and

procedures are communicated effectively. “HR must take the lead in workforce management,

including, when necessary,...
tracking img