Employee retention is defined as an organisation’s ability to hold on to its employees. It refers to the strategies an organisation develops to mitigate employee turnover risks and the processes it puts in place to increase the retention of top talent. At Wasoko, the true measure of our success is in our workforce’s unwavering dedication and collective energy. Employee retention isn’t a sideline endeavour; it’s a mission-critical strategy that breathes life into our growth.
Employee retention is crucial for the sustained success of any organisation. It significantly impacts productivity, morale, and the bottom line. When employees are retained, a company benefits from their accumulated knowledge, experience, and skills, which leads to increased efficiency and innovation. Moreover, high retention rates foster a positive work culture, enhancing employee satisfaction and engagement, reducing recruitment and training costs. As one of the fastest-growing companies in Africa, Wasoko actively incorporates initiatives and strategies to ensure high employee retention rates.
Causes of Low Employee Retention
Low employee retention can be caused by;
- Limited career advancement and development opportunities: Employees who perceive a lack of growth prospects within their current organisation or have no opportunities for skills development may become disengaged and seek new roles where they can achieve their career aspirations, resulting in higher turnover. Companies can invest in their employees using both formal and informal development methods to drive growth and keep their performers engaged.
- Ineffective management and leadership: Poor leadership, characterised by micromanagement, lack of support, frequent erratic changes, unrealistic targets, unstructured performance management, or inadequate communication, can create a hostile work environment and drive talented employees away. A successful company should prioritise strong leadership that fosters an environment where employees feel supported in accomplishing their tasks effectively. Wasoko takes proactive measures to prevent toxic leadership by carefully vetting potential managers, providing comprehensive management training to ensure they are well-equipped to be effective leaders, and measuring leaders on deliverables and soft skills.
- Insufficient communication and feedback: Lack of clear communication channels and constructive feedback can leave employees feeling disconnected and unsure about their performance. When individuals feel excluded from the organisation’s decision-making processes, it can create a sense of isolation. This makes it challenging for employees to share their ideas and thoughts with leadership, ultimately diminishing their interest and commitment to the organisation. To combat disengagement, companies must foster an inclusive and collaborative environment where employees at all levels feel valued and empowered to contribute to the organisation’s success.
- Poor work-life balance: Organisations that demand excessive working hours or fail to accommodate personal life commitments can cause burnout and dissatisfaction. Employees who feel their personal lives are neglected due to work commitments are less likely to be satisfied with their jobs. This dissatisfaction can erode their motivation and enthusiasm for work, prompting them to seek employment elsewhere. To improve this work-life balance, organisations should provide flexible working arrangements or accommodate employee personal commitments that push talented individuals to improve their lives outside of work.
- Inadequate compensation and benefits: Fair and equitable salary structures are essential to ensure that employees feel adequately rewarded for their skills, experience, and responsibilities. When employees perceive that their efforts are not adequately rewarded, they are more likely to seek higher-paying opportunities elsewhere, leading to poor retention rates. To complement the basic salary, an organisation can offer benefits and perks, such as health insurance, performance based bonuses, ESOPs, and flexible work arrangements. For instance, at Wasoko we award shares to all our employees and not just management. Employees are owners of the company which not only improves engagement but has improved our retention rate over the years.
Why Employee Retention is Important
Improves employee expertise. Longevity within a company cultivates skills without career interruptions. An effective retention strategy becomes the catalyst for nurturing employee prowess and aligning competencies with our objectives. As their journey lengthens, so does their dedication to our collective pursuits.
Reduces hiring costs. An effective employee retention strategy reduces the overall cost of hiring for any company by saving the time, costs, and resources for hiring and onboarding new employees. An e-commerce company must resolve not only to retain top performers but to meticulously tailor its retention strategies, preserving their contributions and perpetuating productivity.
Improves employee satisfaction. Employee satisfaction is a key indicator of a successful retention strategy. Wasoko’s exemplary approach underscores this truth. As part of its initiatives, Wasoko runs frequent employee satisfaction surveys to assess employees’ satisfaction rate. A report by Quantum Workplace says that 88% of highly engaged employees agreed that they would be at their organisation in a year, compared to 49% of disengaged employees. Highly engaged employees are 1.8 times more likely to be working at their current organisation in a year, compared with those who are not highly engaged.
Key Themes to Improve Employee Retention
In the unpredictable landscape of employee turnover, the key to fortification lies not in predicting departures, but in building a robust framework for extended employee engagement. The path to achieving this lies in strategic practices that underscore the value of employees as investments in its shared success. Companies concerned about retaining their employees can take key actions to lower the turnover rate.
Wasoko’s retention success, reflected in its remarkable 93% average retention rate, sets a trailblazing example. The measures put in place, underpinned by the following strategies, echo our dedication to nurturing an engaged and committed workforce.
Hire the right people. Our commitment to cultivating a steadfast workforce begins with carefully selecting individuals who resonate with our values, fit our culture, and excel in their roles. Recognizing this, we prioritise identifying individuals who are aligned with our vision, capable of contributing meaningfully and primed for advancement. 80% of employee turnover is due to bad hiring practices, so it is important to be aware of possible mismatches in experience and culture during the interview process.
Develop a strong company culture: A robust company culture is pivotal in bolstering employee retention by creating a workplace where employees feel valued and motivated to stay. Prioritising a positive and inclusive work environment, where ideas are welcomed, feedback is encouraged, and concerns are promptly addressed, fosters a sense of belonging among team members.
Additionally, promoting work-life balance as part of this culture demonstrates the organisation’s commitment to employee well-being, further solidifying their attachment to the company. Moreover, a culture that emphasises collaboration and teamwork across departments and hierarchies enhances camaraderie and encourages the cross-pollination of ideas, which is crucial for the organisation’s continuous growth and, ultimately, for retaining its valuable talent.
Prioritise reward and recognition: When top-performing employees are consistently acknowledged and rewarded for their exceptional contributions, it creates a workplace culture of achievement and success. This recognition serves as a powerful motivator, inspiring employees to not only meet but exceed expectations in their roles. Such positive reinforcement bolsters individual dedication and job satisfaction and encourages employees to consistently deliver their best work, driving overall organisational performance to new heights.
Drive employee growth and development: Driving employee growth and development is a fundamental strategy for enhancing employee retention within an organisation. When employees are provided with opportunities to advance in their careers and take on increased responsibilities, it not only boosts their job satisfaction but also instills a sense of purpose and commitment to the company.
Furthermore, facilitating easy access to learning and development opportunities is essential for nurturing employee skills and competencies. When employees have the chance to acquire new skills or enhance existing ones, they not only become more valuable assets to the organisation but also feel more engaged and motivated in their roles. This sense of personal and professional growth can significantly contribute to employee longevity within the company
Employee retention is not just a practice, but a long-term strategy that defines the company’s brand image and culture. In the current e-commerce space, where technology reigns, prioritising employee well-being is paramount.
Grace Galaty is entrusted with the stewardship of excellence in all facets of people transactional services at Wasoko. Her expertise is intricately interwoven with the very fabric of Wasoko’s culture and values, enabling the harmonious orchestration of all people-related policies, systems, and processes. In close collaboration with cross-functional teams and valued stakeholders, she is dedicated to delivering flawless administration of end-to-end people-related transactions, thereby propelling business productivity to unprecedented heights.Grace Galaty, Head of People Shared Services