Using retention management effectively in your business

What is retention management?

Retention management means keeping employees with the company through specific measures. The term comes from English and means something along the lines of maintaining or holding on to something. It is about keeping employees with a company in times of a skilled labor shortage and high turnover.

Above all, it is meant to prevent employees with high potential from turning to the competition out of dissatisfaction. That is why the most important factor in retention management is employee satisfaction. Dissatisfied employees toy with the idea of quietly checking out long before they finally take that step, and along the way their frustration can have a demoralising effect on other colleagues.

Retention management is closely linked to employer branding, or the employer brand. But while employer branding is mainly about winning new talent for the company, retention management aims to keep employees within the company.

What measures can small and mid-sized companies use

Employee retention is divided into emotional, calculative and qualification-oriented retention. As explained above, the point here is to increase employee satisfaction. But every employee is different, so it is not enough to concentrate on just one of these measures.

Emotional measures

Emotional retention is about increasing an employee's emotional satisfaction. There are various ways to approach this. One would be rewards and awards for long-serving employees. This is how you show appreciation for years of working together and give your employees a sense of recognition. However, this measure only works fairly short term.

Over the longer term, you can keep your employees by giving them a sense of trust. That works, for example, through open scope for action and greater responsibility. Opportunities to help shape things and take decisions also boost employee satisfaction on an emotional level. The most important factor, though, is company culture. This covers the atmosphere in the business, at work and within the team.  

Calculative measures

Young adults in particular look to a company for the chance to combine private life and work without one having a negative effect on the other. That is why incentives such as a sabbatical, but also work-life balance offerings in general, are effective for this group of employees.

In general, though, calculative measures are above all about above-average employment conditions. These include vacation time, fair pay, particular reassurance on occupational safety and other benefits that make the workplace more attractive for the employee.

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Qualification-oriented measures

Qualification-oriented measures are aimed above all at particularly ambitious and career-oriented employees. The point here is to create opportunities to develop your own skills and qualifications. The best-known measures in this context are trainee and development programmes. But career counselling, training opportunities and exclusive career offers also belong here, increasing employee retention by opening up development opportunities and prospects within the company.

These measures are not only feasible for large companies. Small and mid-sized companies can use them too, to see positive changes in their company culture - particularly in labour markets with a severe skilled labor shortage and in leadership and key positions, since these can have a direct effect on employee turnover.

What challenges can arise when implementing retention management?

For employee retention to succeed, you should also look at the possible challenges. We show you the classic hurdles and how to overcome them:

1. Individual needs and expectations

Employees have different needs and expectations, and you must not forget that. It can therefore be a challenge to develop a system of employee retention that is tailored to different personalities, stages of life and career levels.

We therefore advise you to draw up an overview of the various measures listed above and to think carefully about which of these measures really can suit your company and your employees. An important step here is to get in touch with your employees and listen to their point of view.

2. Flexibility and adaptability

Companies and employee needs change over time. Successful retention management requires flexibility and the ability to adapt to changed circumstances. So you cannot simply introduce agile working cultures and then stick with them for the next few years. Agile working also means that, as an employer, you always keep an eye on your company and are willing to change processes if they have a negative effect on employee satisfaction.

Close contact with your team matters here too. Keep an eye on your company and talk to your employees to find out what could drive their motivation even further.

3. Measurement evaluation

One factor that is always a struggle in this area is measurability. It may well be that you do not notice changes straight away - let alone measure them. Perhaps it will only strike you one or two years after introducing the retention measures that you have had to hire considerably fewer new employees. So give the process time.

Retention management strategies - betting on digitalization

One measure we have not covered so far: not making your employees' day-to-day work unnecessarily hard. Piles of paper and awkward processes have a direct negative effect on employee satisfaction – and therefore on how strongly people stay with the company. Yet with the right digital tools that is easy to change.

With clockin, the daily odds and ends run in the background instead of getting in the way. Vacation requests, sick leave notifications, working hours – all via the app, from anywhere, in a few clicks. Your team works independently, keeps track of its own data and does not have to fight through paperwork before the actual work begins. That creates room to breathe – and that pays straight into satisfaction.

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