Look no further than a company’s marketing materials and you’ll see metrics on client retention, sitting alongside the usual spiel. “We keep 97% of our clients” fills prospective businesses with confidence and promotes the idea that this company gets results.
Seeing the message these stats deliver, the HR team takes this commercial measure, flipping it to look at employee retention.
On the face of it, this seems sensible. After all, the more staff you retain, the less you’re spending on recruitment costs such as advertising, or agency fees. You’re also fostering a great place to work – so great that no-one ever wants to leave. This is what a strong employer brand is all about…
…Only it’s not all about the illusion of a great employer brand, it’s about all the people your company interacts with: your customers and your staff included. As Felix Wetzel puts it so bluntly, “There is no B2B, B2C or B2E. There’s only P2P (People to People).”
Just because you retain staff doesn’t mean they’re doing a great job with your customers, or even with each other. Retention isn’t always a measure of employee happiness, it can reflect apathy, a lack of confidence, or a stagnating talent pool.
Look at client sentiment and growth to see how your overall people brand is performing, and implement 360 review tools such as 7Geese or Small Improvements to understand team happiness and motivations.
Mobility puts retention in context. How many of your people have moved roles? Have any taken on new remits or areas of responsibility? Overlay that with performance information and you have a great idea of your top talent – the people you really don’t want to lose.
Arguably, it doesn’t matter if you lose poor performers. If they aren’t contributing, then it’s better for both parties if they move on. That’s part of the reason why counter offers can be negative – they keep people in an environment that makes them unhappy and therefore, not as participative as they could be. They also raise people overheads – potentially increasing the package provided to an employee who wanted to leave the business. This takes investment away from top performers, thus risking their development and upward mobility within the business.
RETENTION ISN’T THE WHOLE STORY
Bill Boorman inspired this title, saying at RECex that “retention is a measure of how bad you are at getting rid of poor performers.” My interpretation is that retention isn’t a standalone metric, it needs context.
In zyx associates’ tradition of starting at the end (hence the name), retention is typically used as a way to measure employee engagement and thus our employer brand.
But what if we looked at mobility/upsells, performance, and sentiment across all the people we work with (clients and employees alike), alongside retention of top performers? Then we’d get a true picture of our people brand.