High employee turnover and low retention rates are major challenges that often affect larger enterprises, but small business owners are not exempt from these issues.
The United States Bureau of Labor Statistics reports historically low levels of unemployment since 2016, but these macroeconomic figures do not tell the whole story about the job marketplace.
The reality of the situation in 2019 is that U.S. employees are quitting their jobs at a rate of three million per month.
This figure has a solid correlation with the strong labor market.U.S. workers see the low unemployment rate as an enticement to try their luck elsewhere.
They feel confident in their ability to land another job quickly if satisfaction is lacking in their present position.
Holistic Approach to Employee Retention
Developing employee loyalty is not an easy undertaking for owners of small and medium companies.
A holistic corporate culture is something that Japanese employers mastered in the 20th century through the renowned Theory Z of personnel management. It has proven to be very effective in terms of instilling a sense of loyalty among staff members.
The most important factor comprising Theory Z relates to establishing a culture of learning in an organization.
What they realized when they formulated Theory Z is that many of the most dominant samurai clans in the nation’s history were pretty serious about the use of learning to foment loyalty.
An interesting aspect of learning is that humans have a natural disposition to embrace it; to a great extent, this disposition unconsciously translates into loyalty because employees prefer to stay within organizations where they are constantly learning.
Why You Should Be Investing in Knowledge and Learning from the Start
First impressions last forever and as a business owner, it is in your best interest to introduce learning and knowledge acquisition to your employees from the beginning, ideally during the orientation process for new hires.
As previously mentioned, learning is something that people are not only familiar with but also come to appreciate, and this is an initial building block for retention and engagement.
You really want your corporate learning process to shine during new hire orientation. The goal should extend beyond showing new employees how things are done; this is an ideal time to introduce them to future learning opportunities they can look forward to.
Never be shy about highlighting the learning culture of your company.
Continuous Learning Opportunities Will Make Employees Stick With You
Business owners should not cut employee education short after the new hire orientation. A few years ago, retail banking giant BB&T discovered an important aspect of employee retention in their offices relates to learning opportunities.
The company’s Leadership Development Program involves several months of full-time classroom education, and subsequent retention among graduates of this program was 76 percent, nearly 50 percent higher than overall retention.
Small and medium-sized companies that cannot manage an internal college program such as BB&T has should consider implementing a learning management system (LMS) to improve retention.
LMS platforms are essentially centralized knowledge hubs that can be accessed from anywhere as long as you have credentials, thanks to cloud-based solutions.
This means that employees who work remotely from home or are out in the field can access it too, which helps with making them feel like a part of the team and improve their retention rates.
This is just one example of how cloud computing revolutionizes businesses. Now you can provide continuous learning and combat the forgetting curve for all team members, regardless of their location.
Learning Opportunities Help You Close the Skill Gap
Contrary to what many employers think, recruiting is not the best way to address skill gaps in their companies; developing an internal learning culture happens to be more efficient.
It is better to promote the adoption of an improvement mindset among staff members, and this can be accomplished with the right training and education programs, which is something that the Toyota Motor Corporation has been doing for many decades.
In fact, public school districts in the United States have been adopting some of Toyota’s educational strategies since the 1990s.
Japanese automakers rarely search for new employees when faced with emerging technologies; in the case of the Prius hybrid car, Toyota executives actually invested more in training for the purpose of closing the skill gap than they did in new parts and materials.
Empower Employees and Keep Them Engaged Through Innovation
This is an extremely important advantage of corporate learning because it is intrinsically tied to current business trends.
When personal transportation app Uber rolled out operations in San Francisco, taxicab use in that metropolitan area declined by more than 60 percent in just a couple of years.
Even though taxi fleet operators eventually responded with apps and other innovations of their own a few years later, the damage was already done and many of their veteran drivers started bailing out.
Innovation is going to be an even stronger driving force for business owners through the rest of the 21st century, and one of the best ways to find fresh and relevant new ideas is to get them from smart employees.
Learning environments are inherently conducive to the formulation of new ideas and inviting employees to brainstorming sessions is an excellent way to keep them engaged because they will make them feel appreciated.
Within the aforementioned Theory Z of personnel management, workers are entrusted to do perform their duties to the maximum of their abilities, and this includes being able to contribute in terms of promoting innovation.