Employee Retention Funnel
The employee retention funnel, just likes its cousin the sales funnel, shows the steps necessary and where on the employee continuum a prospective employee or employee is and what should be happening. Some of these steps might come in a slightly different order and some may happen simultaneously. There could be slight nuances, but these stages and steps will typically be constant in most situations.
While you should have a strategy for all elements of the employee retention funnel. More attention should be paid to those at the top. Those on the front end of the process. Particularly recruiting, screening, interviewing, and onboarding. It is much easier to retain a good hire than it is to retain a bad hire.
This amplifies that important of focusing on making the best hires possible. Then get them off to a great start with you company. Even a good hire can become frustrated and feel alone at company if not onboarded, given initial positional and company training, along with providing a mentor.
We can perform the bottom of the funnel activities perfectly but if it’s a bad hire, they will end up getting frustrated and leaving on their own or worse, you will end up letting them go. Then you start the cycle all over again. It truly is a waste of talent, time, and money.
It should be said that all employee turnover is not bad. Again, this sounds counter intuitive since my entire business premise is employee retention. As they say, not all employees were created equal. What is a healthy mix for your business?
While it really depends on the industry and types of workers, I would say that most business should have retention rates in the 15% to 20% range. There is going to be turnover you can’t prevent no matter how good you are. There will be deaths (off the job mostly), retirements, those that move with a spouse, staying home with kids, and others. These are perfectly legitimate and really non-preventable.
Then there are those that need to be turnover…dismissed or fired. Again, we are dealing with people and there is no full proof system to always be 100% in hiring. Also, people can change due to pressures at home, addiction, and greed. While we want to offer assistance to employees with these challenges it doesn’t always work. Its not easy, I have been there. Sometimes things just run their course and we have no alternatives.
The employee retention funnel is not a magic funnel. You cant just pour prospects into the top and expect to make long term employees. Not in the least. It takes work and planning to do everything necessary to hire and develop great employees that want to stay around for a long time. This is also a process that your entire teams needs to get on board and behind. One person in HR will not solve your employee retention problems. It will take you and your entire team to make a long term commitment to the process. This is one reason employee turnover is rampant in some companies. They will not take on the organizational transformation needs to accomplish increasing employee retention.
Be an employer of choice, NOT an employer of last resort.