Employee retention is one of the biggest challenges to any organisation. Your SME business may suffer from high turnover and you feel powerless to change this. Keeping everyone happy all the time is difficult.
As an SME owner you must be pragmatic. Try multiple strategies to boost your employee retention rate; some internal and some external. Keep trying. You can try all the tricks in the book but if the job market in your area changes suddenly, then you may face a mass exodus. Preventing this involves being and staying on top of your game.
Economists will offer you many explanations of the benefits of a minimum wage. The reality is that many minimum wage employees feel they are working in a job that they have no interest in. They can find many similar jobs nearby. This maybe because the employee lacks the education level to obtain a higher paying job. There may also be a shortage of good opportunities in the locality.
One strategy for an SME owner to overcome minimum wage staff turnover is to offer your employees educational opportunities. Help them to advance their personal and professional skills. By investing in your employees, they may feel more loyal to your business. Even if they leave, they will have a better impression of your SME that they will tell to others.
Another strategy is to give your employees real transferable skills. Teach them how to use and manage new business software that adds value to a business. Malaysia will have a uniformed minimum wage of RM1, 050 per month or RM5.05 per hour beginning Jan 1, 2019. So, giving your staff something more than just the minimum is essential.
Get to know your employees well. This is one strategy for trying to increase retention rates. Training your staff properly to make them more competent, higher valued added and more satisfied in their role. It will also make them more employable. You don’t want to see your staff grow and then leave. So make them sign a bonded agreement. If you give them the relevant training, they may be yearning for then make sure that they stay for a year of two afterwards to add value to your business.
Be aware of the external job market in your area. Some folks like to stay close to home and are unlikely to take their education and then go to work overseas. Others may move to a local competitor for just a few dollars more. This is a particular trend in developing countries in SE Asia. So, to prevent your SME from suffering from massive fallout as a new, more sexy business starts up in your locality, get your staff bonded. Don’t forget to bond with your staff too; staff lunches and drinks after work.
The shortage of talent in Asia, and globally, is no secret. If you have talents in your SME business hold on to them. Talent management is attracting, developing and retaining good employees. It has become a business process for HR professionals to master. At the heart of recruitment lies the motivation for an employee to move. Finding out what this motivation or motivations are can be achieved simply by asking the relevant questions.
An ambitious person may not always be driven by increased financial compensation. There may be personal factors that are stronger. A mid-career professional with a good salary who accepts your offer may be simply looking for a change. To be nearer their family or to get away from something they are not currently comfortable with.
On boarding an employee then follows but people professional and personal circumstances change once they become your employee. Developing them with education and mentoring are key to employee retention. There may then come tipping points in your SME where current staff are no longer needed and you will need to let them go.
Your challenge in improving employee retention is to figure out the motivations of your staff to stay or leave. Then give them what they really want to stay and add value to your business. One good way is to train new and existing staff how to use business and accounting software.