Employee retention is a significant problem in businesses, regardless of whether they are small, mid-sized, or large. Across the board, employee turnover is costly and can bring production to a grinding halt. Almost 78 percent (4 out of 5) leaders in business consider employee retention to be important and even urgent. With approximately a third of new hires quitting by around the six-month mark, these business leaders have good cause to be concerned.
The cost of employee turnover can be substantial. Several studies have analyzed the associated costs and have determined that it costs anywhere from 6 to 9 months’ to a year’s salary of the employee being replaced. A study conducted by the Center for American Progress further broke down the costs of employee turnover:
- $3,328 – Cost to replace an employee working retail, earning $10 an hour – 16 percent of annual salary (low paying and high turnover jobs)
- $8,000 – Cost to replace a manager earning $40k – 20 percent of annual salary (positions that are mid range)
- $213,000 – Cost to replace a CEO earning $100k – 213 percent (executive positions, highly educated employee)
Many businesses are realizing the benefits of hiring a business coach. Employee retention numbers can fall with the right coaching. A good coach will help you create effective employee retention strategies to help you improve retention rates.
Business Coaches Put a Fresh Set of Eyes on Your Organizational Issues
Business coaches are often able to identify issues that your employees have been worrying about or that you have been unaware of for the past few months, and will help you to solve those issues. A good business coach will come into your organization with a fresh set of eyes and see the issues with employees, policies, and business practices that you are too close to see clearly. They can root out employee morale problems and advise you of ways to create a more cohesive environment within your company so that your employees feel like they are a part of something important. They can teach you invaluable team building skills and empower your employees to take ownership of their jobs.
Many businesses are reactive as opposed to proactive. They rarely try to prevent fires, only respond to them once they have already ignited. Unfortunately, these companies do not notice the first sparks of the fire, or even the when it is small. It is only when that fire is a raging, destructive forest fire that it gets attention. A business coach can find the fire when it is just a few sparks and keep it from spreading.
Business Coaches Can Help Set Better Employee Goals
A business consultant can help you to better understand both the personal and career goals of your employees. They can help you find ways to allow your employees to pursue those goals through their individual positions within your organization. Goal setting is absolutely integral to not just production and your company’s growth, it is also one of the core building blocks in employee morale. The business coach will incorporate goal setting with other employee retention ideas to create an environment that encourages low turnover.
By helping your employees identify what they want or need both personally and professionally, the coach will help them set goals to help guide them toward their own brand of success. They can help you find the internal coaches in your organization and help the employees find their leadership capabilities – they teach them how to lead. A great business coach will teach you how to coach your employees to greatness. They will help each employee find his or her own greatness and discover how it fits, how they fit, into your organization. As your employees hone their strengths and learn how to turn around their weaknesses through goal setting, you will see a difference not only in the employees themselves, but in the organization as well.
Business Coaches Can Restore Employee Confidence During Hard Times
Difficult times can affect employees in many ways. Home problems can bleed into work life and problems at work can definitely affect their private life. When the business is going through hard times, employees can feel insecure and uncertain. These are morale killers and can result in the employees jumping ship instead of sticking it out. If they don’t have a vested interest in the company they really have no reason to stay, to weather the storm with the team. A business coach can zero in on areas where employee confidence is slipping and find effective ways to keep morale high during times when business is slow
A business coach can help employees see a bigger picture – and picture themselves as an important part of the organization. They can help your employees create strategies that will get them through the slump, setting goals to pursue personal interests as well as career oriented ones. They will inspire, motivate, and help your employees find reasons to stay with you. You can’t teach loyalty, but you can inspire people to be loyal and that is exactly what a business coach can do.
While a great business coach can help you turn your employee retention problems around, an Entrepreneurial Operating System (EOS) can help your entire organization grow and thrive.
Don’t wait until employee retention becomes your organization’s biggest cost. Learn more about EOS and contact us for a free business coaching quote.
The Entrepreneurial Operating System (EOS) was created by Gino Wickman (Author of Traction-get a grip on your business) and is a registered trademark of EOS Worlwide. Chris Hallberg of Traction Inc. is a Certified EOS Implementer(tm) that helps business owners and their leadership teams get more of what they want from their business.