In today’s economy, organizations are faced with the challenge of continuously improving efficiency to remain competitive. This means strict oversight and tight controls on those elements that effect an organization’s cost structure. Historically, the focus has been on tangible costs that are easily identifiable and can be accurately measured. Now, in order to continue down the path of efficiency, many businesses are focusing on costs that do not appear on the financial statements and that may not be easily measured with traditional systems. One such intangible is turnover costs. These consist of a variety of smaller expenses such as administrative costs to process candidates, interview costs, severance pay/unemployment pay, advertising expense, training time and expense, lost opportunities, and relocation costs. 

In order to design, implement, and maintain a successful employee retention program, the organization must have a thorough understanding of what motivates employees. Surprisingly, the primary motivators for most people, regardless of their employer’s industry, size, or workflow pace are the same. Employees need to feel they are appreciated, valued, and trusted. The business should get past viewing employees as an expendable resource and begin treating them as integral parts in the organization’s long-term success. This is not about family, love, or friendship; it is about respecting people and their contributions to the company effort. Psychologists tell us that once basic physiological needs are met, the individual seeks safety. In the next level of the need hierarchy, humans desire a sense of belonging and then to satisfy their self-esteem needs. The wise employer builds dynamic career paths among valued employees, discusses personal growth opportunities, outlines goals, takes action, and delivers recognition for good work. 

Beyond an employee’s need to feel valued and the desire for development, the business should provide opportunities for the employee to receive higher levels of responsibility and accountability. Increased responsibility in decision making processes within the business can encourage innovation and creativity.