It should come as no surprise that companies that lead in employee engagement are often some of the most successful and profitable organizations.
On the flipside, poor employee engagement means turnover, low morale, poor customer service, and a general blow to your bottom line.
However, the issue becomes ultra-costly when high-performing employees start leaving because of low engagement.
Similar to keeping good customers, the cost of replacing high-performers easily outweighs the cost of retaining them. This easily illustrates why employee retention is important.
According to Gallup, just 13% of employees are engaged at their jobs.
But Gallup has spotlighted 40 companies that buck this trend and have employee engagement rates at around 64% — a huge, huge difference that pays many dividends for these organizations.
We took a closer look at what 10 of these organizations are doing to come up with some actionable employee retention ideas:
1. CarMax Makes Hard Times Easier on Employees
The recession in 2008 made for tough times for companies and their employees across the globe.
But instead of saving money for the company by cutting employee benefits, perks, and recognition programs — and frankly, employees themselves with layoffs — CarMax decided to go in the exact opposite direction.
During the 2008 recession, CarMax and its president and CEO Tom Folliard decided to invest more heavily in employee programs.
CarMax boosted its employee training and development programs, helping existing employees earn raises and jump through the ranks of the company.
The company also focused on cultivating its own employee ideas via feedback to better their customer experience. Those ideas were then rewarded in strong employee recognition programs.
In essence, the CarMax employee retention strategies became all about its employees.
In a statement during his speech at the Great Place to Work conference in 2012, Folliard said: “Take care of your associates, they will take care of our customers, and the rest will take care of itself.”
Since 2009, CarMax results have been summed up by the Motley Fool in a single word: impressive.
CarMax sales are up 116% in eight years, or 14.5% annualized.
Takeaway for leaders
- Your employee retention strategies need to focus on your team before any other business factors come into question.
- Don’t aim to save money when it comes to your human resources.
- Taking care of the people who are part of your business first results in greater general results and profits later.
2. Charles Schwab Treats its Employees as Well as its Clients
Charles Schwab doesn’t just care about the financial future of its clients. The brokerage firm invests that same care and attention into the financial future of its employees.
Schwab’s financial-based benefits plan is off the charts, offering a 401(k) matching system that can be boosted with rewards from its employee recognition program. Talk about looking out for staff’s future.
The majority of the company’s workforce also participates in the corporate bonus plan.
Perhaps most unique is that the company enables employees to help other employees, which has to be one of the most effective employee retention techniques.
Staff members are all offered complimentary personal Charles Schwab financial consultations and support as well as financial workshops and discounts and savings on their own trading and portfolio.
To make employee’s financial positions even stronger, they offer an employee stock purchase plan and comprehensive medical, dental, and visual plans, as well.
Takeaway for leaders
- Care for your employees as much as you care for clients.
- Make it an employee retention strategy to offer bonus plans and perks that other companies don’t.
- Try to offer all of the benefits your employees need from an employer.
SOURCE: glassdoor.com
3. Hyatt Trains its Employees for the Long Term
On average, an employee in housekeeping stays with Hyatt for more than 12 years.
Altogether, more than 14,000 of Hyatt’s approximately 75,000 US employees have worked at the company for more than 10 years.
Clearly, the hotel company is doing something to keep its staff around.
The training program at Hyatt is top-notch, and the company has a solid program of hiring from within by identifying potential leadership candidates from its existing workforce.
In the last few years, the company rolled out an entirely updated training program called “Change the Conversation,” which is based on principles from the Stanford School of Design that emphasize listening.
Employees are encouraged to find new, creative ways to solve problems and accomplish everyday tasks. It trusts its own employees so much that it’s number one source of new hires is via recommendations by its Employee Referral Program.
Moreover, Hyatt has championed diversity in its workforce.
For 10 years running, Hyatt has made the Human Rights Campaign’s Best Place to Work for LGBT Equality list; the AARP called out Hyatt’s commitment to hiring older Americans; and Hyatt has been featured by the NAACP and Hispanic Business magazine for its hiring of African American and Hispanic employees, respectively.
Takeaway for leaders
- Investing in high-quality education and training programs will keep employees within your company for longer.
- Support diversity within the workplace.
- Encourage your team to be creative and come up with their own solutions to problems.
Inchcape has an embedded employee engagement program called “Incredible Inchcape,” which focuses on building what it believes to be a great place to work by committing to its community.
A major part of Inchcape’s company values center around its societal and environmental impact.
It’s transparent about its carbon dioxide release levels and it has worked to continuously decrease its greenhouse gas emissions — keeping employees, clients, and the global community on top of all of their statistics.
Inchcape also regularly contributes to charities across the globe — in China, Ethiopia, Latvia, Singapore, Macedonia, and more — with an emphasis on donating to orphanages and local environmental causes.
And they don’t just contribute money; they contribute time and attention as well. For example, an Inchcape team spent Christmas day at a village in the Jiangxi Province in China where most of the children are orphans.
They celebrated the holiday with 150 children with games, music, and crafts.
Moreover, Inchcape has worked to align its employee recognition program with these values, rewarding employees who live the company culture with discounted new cars, services, and financial rewards.
Takeaway for leaders
- Help employees make an environmental and societal impact.
- Create an entire work culture around goals that are shared on a company-wide level.
- Reward your team for giving their best to help the world as an employee retention strategy.
5. Mars, Inc. Is Pretty Sweet to its Employees
It’s not just that employees get to munch on free M&Ms — though that doesn’t hurt. The colossal chocolate and snack food empire knows that it can show its appreciation for employees by living its company values.
Maybe that’s just how it’s done in a 100% family-owned business.
The Mars family is notoriously private. But it seems that characteristic only boosts employee (or Martian) pride in the company.
According to research by Fortune, turnover is only around 5% in the United States, and Mars can claim families who have had generation after generation working for the company.
Mars knows that to inspire this kind of dedication, it has to earn it.
The five principles of Mars — quality, responsibility, mutuality, efficiency, freedom — are on every wall of every Mars office and manufacturing site across 73 countries. And as employee Will Turnipseed told Fortune, “they’re cult as much as culture,” but “they don’t tattoo them on us or anything like that.”
And Mars takes its values seriously. Take, for example, “quality.” Around 2% of all M&Ms produce are discarded for “blemishes” or other failures in quality.
Takeaway for leaders
- Create a set of shared principles and promote them in your workplace.
- Ensure your team and company delivers upon the promised value.
- Show appreciation on a day-to-day basis to retain employees for many years to come.
6. Buffer Changing up the Remote Work Game
The Buffer team has been a pillar example of outstanding culture for distributed teams and employee retention strategies. Their retention rate is a whopping 94% with a mere turnover rate of 5.8%.
The team is fully distributed and has been focusing on creating a fulfilling workspace from day one. They believe that ensuring employee happiness and getting them committed to the brand will also help the company maintain positive customer experiences and retain customers as well.
The core value within the Buffer team has been providing transparency in order to build trust within the company. This being said, all of their salaries are public so no one will ever feel like they’re left behind or not getting paid realistically for the work they deliver. And, yes, you can check out the formula they use to set their salaries too.
Above this, they took their transparency into their product as well, making their code open source and free for anyone to use as well as showcasing a public product roadmap.
They have five more core values which they’ve incorporated into their day-to-day work routine to ensure employees have their needs met:
- Cultivating positivity
- Showing gratitude
- Improving consistently
- Practicing reflection
- Acting beyond oneself
Not to mention the extra benefits they get — including health insurance, profit sharing, 401(k) plan, fun retreats, free books, and even sabbaticals. No wonder that 59% of Buffer employees want to stay with the company for as long as possible.
Takeaway for leaders
- Offer to pay for everything a remote employee might need to do their work.
- Do not leave out the core benefits when employing remotely.
- Maintain transparency within the team so no one will ever doubt another colleague and feel like their treatment or pay is unfair.
Source: buffer.com
7. Zappos Is Putting Employees First as Part of Their Employee Retention Strategies
Staff retention rates at Zappos are at 85%, a number most of us dream of. So how did they do it?
A common trend among companies with high employee retention rates seems to be the transparency they turn to as they choose to publicly highlight the core values of the company.
In this case, they focus on 10 key values with #1 and #8 standing out specifically:
- Deliver WOW Through Service
- Embrace and Drive Change
- Create Fun and A Little Weirdness
- Be Adventurous, Creative, and Open-Minded
- Pursue Growth and Learning
- Build Open and Honest Relationships With Communication
- Build a Positive Team and Family Spirit
- Do More With Less
- Be Passionate and Determined
- Be Humble
Zappos, which is owned by Amazon, is also one of the few companies that integrate a variety of all positive values into their retention strategies. Even their own brand and partnerships are part of this culture as they help define every single employee’s path.
As the team has become a family and trust is the top priority in the company, Zappos has been hiring with cultural fit in mind. Beyond this, what they encourage is individuality and creative freedom. They’ve been recognizing employees for their performance while also allowing them to self-manage their work in order to speed up the creative process.
Since so many individuals and companies have already shown interest in their culture, they’ve even released their own book on work culture.
Takeaway for leaders
- Promote your company’s values like you promote your brand.
- Aim to increase and maintain strong trust levels within your employees.
- Give your team the freedom to manage their work the way they want.
8. Cadence Promoting Respect and Acknowledging People as Their #1 Asset
The Cadence workplace culture is already well-known for its focus on general world issues like sustainability, diversity, and pay equity. They foster inclusion and welcome professionals from multiple backgrounds and work experiences. The company runs a College Hires and Internship Program to work with recent graduates who can get a first look at what a collaborative team environment that’s also aimed at personal growth can be like.
The culture direction at Cadence has received numerous awards in time including Great Place to Work around the world, Fortune's list of the 100 Best Companies to Work For, World’s Best Multinational Workplace, features in lists for Best Workplace for Millennials, Giving Back, Parents, and other recognitions.
They’ve also been supporting giving, sustainability, and worldwide causes through programs such as Volunteer Time Off, Season of Giving, and Matching Gifts. All of these allow every individual within the company to bring their own contribution to the cause of their choice while being fully supported by the company.
Taking everything into account, the “One Cadence—One Team” motto is also a perfect representative of what the company is all about. And 92% of employees being proud to tell others they work at the company is not a feat to ignore either.
From corporate social responsibility to diversity and inclusion, Zappos has rightfully earned the various awards solely for the work culture they provide.
Takeaway for leaders
- Divide your company values in multiple directions so every employee can find a cause to support.
- Let people take time off to do what they love and help their community.
- Aim to turn your office into a place your team will always love coming back to.
9. Patagonia Is Helping Employees Fight for Common Values
Patagonia made the list thanks to their work-life balance focus, shared values, and help for working parents. Their main ideals lie at the following statements:
Build the best product. Use business to protect nature. Don’t be bound by convention. Implement solutions to the environmental crisis.
All this being required from a single person, it certainly isn’t easy to hire a Patagonian. The HR manager has admitted he reads the full resumes for all candidates to make sure they’ll work with the right people for their culture.
Patagonia is looking to bring in unique individuals that don’t necessarily have the same interests so they can provide their one-of-a-kind feedback and input. However, they do need to share similar values including helping others and volunteering.
Given the nature of their brand, the largest company value is activism. All employees are driven by activism that gives them a sense of accomplishment. In turn, this helps Patagonia retain their employees since they offer the perfect environment for anyone who wants to leave their mark on the world.
The benefits are just as great, too. They encourage taking time off and paid sabbaticals more than your average company and have been providing an on-site child care center since 1983:
Takeaway for leaders
- Employ the right people based on culture fit.
- Pay more attention and dedicate extra time towards the recruiting process.
- Create diverse teams so everyone can bring their own points of view to the table.
10. MailerLite Switched up Their Hiring Process
Another employee retention example comes from MailerLite.
They’ve been using remote work as part of their branding process like no other team. Yet, beyond the remote work perk, they excel as retaining employees by simply choosing the right people to come on board.
To do this, they ditched the common cover letter and turned to their own tool to create a unique hiring experience. Candidates now send a newsletter created with MailerLite to showcase their skills, personality, and creativity.
At the same time, they learn to use the tool and have a better opportunity to highlight why they belong to the team compared to a plain cover letter.
The switch to this nonconformist method was a result of lots of research which concluded that talented people were more likely to be excited about a challenge. They’d also spend more time researching the company and reading their blog where they talk about their own work culture as much as possible.
This single change has made it possible for MailerLite to filter out the people who couldn’t be bothered to take the time and do this task. Above all else, the company also ensures team fit by allowing every single person to choose their next team member.
The HR manager was hired after they already had 50 employees just to ensure team bonding and happiness and take care of the more administrative and legal aspects. Ultimately, it’s every employee who decides who would be better suited for their team based on skills and values.
Takeaway for leaders
- Use your workplace culture as part of your branding and company identity.
- Don’t be afraid to experiment with new recruiting methods until you find the one that works best for you.
- Let your current team members have a say when you’re hiring a new person.
Source: mailerlite.com
How Does Your Employee Retention Strategy Stack Up?
These 10 companies know the right employee retention strategies to boost engagement. Do your best to mimic your favorite takeaways to drive your employee retention rate through the roof.
Keep in mind that you don’t have to reinvent the wheel. Learn your lesson from the ones doing it the best.
Some of the common things all of these companies do is publish their company’s core values, offer unique benefits to their employees, and create a sense of shared purpose.
Before you get started with rethinking your work culture, make sure that you don't have an unseen retention problem in your office. Spotting problems as early as possible will let you create a complex plan of tackling these issues to boost your employee retention rates.
Editor’s Note: This post was originally published in July 2015 and has been updated for freshness, accuracy, and comprehensiveness.
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The Secret Weapon to Your Employee Retention Strategy
Effective Employee Retention Strategies for the Retail Industry
