Wednesday, February 20, 2008

For Successful Business, It's All About Retention

Copyright © Michael Laleye

There are two things that no business can do without in order to grow or even just survive. Without employees and customers there essentially is no business and all owners are in a constant battle to retain both. Unfortunately, many business owners do not see this need as important and make some common mistakes that cause them to lose both on a regular basis.

Employee turn over is not new and will it is unlikely that any business will ever have a 100 percent retention rate. Between retirements, employees striking out on the own or winning the lottery can never wanting to work again are some of the voluntary reasons people have for leaving an otherwise good job. There is little that employers can do to prevent this type of turn over, but the employees will still have to be replaced. There is what some employers consider good turn over, when a bad hiring decision was made and an employee has a negative attitude that is affecting the morale and productivity of others.

The cost of employee turn over can be high, considering that many employment experts put a price tag of between $2,000 and $3,000 on the search and training efforts to add each new employee. That is just getting them on the job, trained and ready to work and does not consider how long it takes to make them productive enough to become an asset.

Numerous employment surveys have shown that while money is important to many employees there are other things employers can do to keep them happy, productive and on the job. One of the most common complaints from employees is a lack of training to enable them to fulfill their job duties to the employer's expectations. Feeling that they cannot do their job properly leads many to seek out other opportunities.

Feeling appreciated for the job they do is another major complaint among employees and while they may be doing exactly what they are paid to do, just want to know that the boss knows they are there and doing it. Many employers only thank employees if they go above and beyond their normal job description duties, saying they are paid to some to work every day and do their job. Employees agree that yes, that is their responsibility but there is no incentive to do anything extra. Incentive can come from a certificate of appreciation or a certificate of attendance.

Customers are another matter in which some company owners fail to recognize the importance of keeping them happy. Studies have shown that when a customer is happy with a company they tell three or four of their friends. However, if a complaint is not resolved they will tell a dozen or so and word of mouth advertising can go both ways to help or hurt a business.

The customer may not always be right, but the owner needs to make them think that they are by making them feel important enough to take the time to explain to them why they are being told no.

DID YOU KNOW? The U.S. Social Security Board reports that 85 out of 100 Americans reaching age 65 don't possess as much as $250. And only 2% are self-sustaining (the rest dependent on family, church, or the government)! Want to know what the "2-percenters" know that you don't?

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