How Managers Can Impact Employee Retention

Business Team Signing ContractFor years corporate leaders and HR professionals have debated the question of employee retention. Which are the best retention tools? Should we offer people more pay and benefits? Or give them meaningful work and better bosses?

The answer, of course, is both.We all know employees who have left because another company offered them a higher salary or a benefits package that better met their needs. And we all know employees who have left to escape a terrible manager or an unmanageable workload.

In a November 28, 2012 post, 4 Ways to Rock Your Employee Benefits & Rewards Program, Jessica Miller-MerrellBlogging4Jobs, wrote: 

“Money is (and probably always will be) the number one way to recruit, retain and hire qualified job seekers.” 

Not surprisingly, a 2010 World at Work study found that “total rewards structures, programs and policies influence employee engagement.”  But this report also concluded that

“When the impact of different categories of rewards programs on engagement was studied, it was discovered that base pay and benefits had the overall weakest relationship with the organization’s ability to foster high levels of employee engagement and motivation compared to incentives, intangible rewards and quality of leadership on engagement. Quality of leadership had the strongest relationship with effectively engaging and motivating employees.”

In an article for Forbes, Why Are So Many Employees Disengaged?, January 18, 2013, Victor Lipman states that most employees are disengaged at work because of the relationships with their immediate supervisor. The reason these relationships are often a problem is because:

“Put simply, the qualities commonly associated with management and leadership – being authoritative, decisive, forceful, perhaps somewhat controlling, if not moderated by a high degree of awareness as to how one comes across and is perceived by others, are also qualities that have the potential to easily alienate those on the receiving end.”

Thus, while pay is critically important for retention, the manager relationship is what engages your staff while they work for you.

MP900439486Yet people get promoted into management for reasons quite different than what makes people good managers. Most of us have to work hard to be good managers.

As I studied the question of employee retention, I came to care less whether pay or manager relationships were more important for engagement and retention than about what each person in the organization could do to impact these important work issues. It is only when we take the theory and conclusions of management studies and apply them to the work we do each day that we can develop our own action plans to improve our work life and the lives and performance of those we work with.

Most of us have some control over how much our employees get paid. Managers often have input into pay decisions, even when employees are on a step pay scale. Where employees are on a merit pay scale, managers can allocate more money to better performers. Nevertheless, with the checks and balances in place in most modern corporations, only a few top leaders can have significant impact on the pay of their subordinates.

Managers have more control over the day-to-day work environment and how they interact with their employees.

So, what can you do to be a good manager? Volumes have been written on this topic, but here are Lipman’s suggestions (a good starting place):

  • Listen to what your subordinates say
  • Be perceptive about what motivates your staff and what they are dealing with
  • Communicate openly and be approachable
  • Stay calm, don’t get angry
  • Demonstrate true concern for your direct reports’ well-being

All this doesn’t mean that you avoid conflict or tough decisions. It does mean you act ethically and with appreciation for what each of your staff members brings to the workplace and the challenges each person faces.

Is it easy? No. Is it rewarding to see where you make a difference in the lives of those you work with? Yes.

What are you doing within your authority to improve the work environment for the people who work for you?


Filed under Employee Engagement, Human Resources, Leadership, Management, Work/Life, Workplace

5 responses to “How Managers Can Impact Employee Retention

  1. Your points are good to remember in any interactive realtionships.

  2. Pingback: Assess Yourself as a Manager As You Assess Your Employees | Sara Rickover, Behind the Corporate Veil

  3. Pingback: My 200th Post: A Retrospective, a Thank-You, and a Request | Sara Rickover, Behind the Corporate Veil

  4. Pingback: How Reliable are Workers Virtual Assistants from the Philippines

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