Technology and Employee Retention
The culture of work is evolving; digital solutions are key to boosting your team’s satisfaction and engagement
Today, in companies across diverse sectors, employee retention has become a pressing challenge.
In separate but related trends—the great resignation, (which the Pew Research Center calls a “nearly unprecedented churn in the U.S. labor market”), and the rise of the gig economy (36% of American workers, about 58 million, now identify as independent workers according to McKinsey’s American Opportunity Survey, a dramatic increase)—employees have signaled that they value experience over permanence, satisfaction over stability.
Even in traditional job settings, the landscape has shifted. It’s not only that pandemic-era lockdowns forced us to radically rethink the way work (remote, hybrid, virtual, increasingly digital), it’s that events of the last few years have spurred what Gartner terms a “great reflection.” Employees—people—from all walks of life have taken a step back to ask what they really want, need, and hold dear; whether their work is fulfilling and they feel valued in their role; and what they should be able to expect of a job, employer, company, or career.
A 2021 Oracle survey of over 14,600 people found that 93% had seriously reflected on their lives over the previous year, and 88% reported that “the meaning of success has changed for them.”
Now companies are struggling to retain top talent. A recent UKG survey, revealed that 87% of HR leaders believe employee retention strategies are a top priority.
Why is turnover such a major concern? Consider these five factors, which make retaining talent and keeping turnover low so crucial:
- Hiring is expensive. In addition to initial onboarding costs, training can run as high as 20% of total salary. In addition, there are costly disruptions to workflow.
- Greater efficiency. The loss of employees causes others to have to take up the slack while new hires get up to speed. It can take a new employee up to two years to reach the level of productivity of the person they replaced.
- Better engagement. When you have the right person in the right job, feeling satisfied in their work and respected by their company, they are more engaged and likely to innovate—59% of engaged employees told Gallup that their role elicited their most creative ideas. Passionate, invested, connected workers move a company forward.
- Positive company culture. When staff are leaving, morale declines. Employees lose collegial relationships and opportunities to collaborate; communication suffers. A stable workforce promotes a positive organizational culture.
- Improved customer service. Research consistently shows a positive correlation between employee experience and customer satisfaction. As Richard Branson famously said, “Clients do not come first. Employees come first. If you take care of your employees, they will take care of the clients.”
What this means for enterprise leaders. The willingness to quit has increased employee power. What do modern workers want? The Oracle survey showed that workers’ top priorities today include work-life balance (42 percent); mental health (37 percent); and workplace flexibility (33 percent). Employees seek flexibility, autonomy, independence, and career development opportunities, plus a stronger relationship with management, and greater recognition and respect.
The way forward. In a time of global crisis, technology and digital transformation supported our transition to a necessary, novel way of working (immediate); it also helped engender a macro-level revolution, not only in how we work but also in how we think about work and value it, our philosophy about its place in our lives (sea change). Employee retention in the current climate, while a business problem and priority, is at heart a human matter.
What brings it full circle is that technology is key to keeping top talent on board.
The question is not only What technological tools will help us retain employees? but, more broadly, How can we harness digital solutions to help us elevate employee experience and heighten engagement in the modern economy and work culture?
A few examples:
Onboarding. Technology can significantly streamline and speed the onboarding process, provide reassurance that sensitive information is secure, reduce cumbersome paperwork, and empower new employees with the tools they need to perform at a high level right from the start, wherever they’re working from. Statistics demonstrate that nearly 70% of employees who experience a smooth—thorough but not overwhelming—onboarding process will remain with the company for at least 3 years.
Automation and efficiency. Digital tools facilitate better workflows, preventing employees from feeling bogged down with monotonous tasks and improving engagement. Automation of basic functions allows your team to focus on more meaningful work, spurring innovation and collaboration. Additionally, as Harvard Business Review points out, automation can enable managers to shift focus away from task management onto experience management to support their teams.
Work-life balance. By facilitating a hybrid work environment, digital tools give employees greater flexibility, autonomy, and control without compromising the company’s need for security, data management, and cost-effectiveness. Wide connectivity, fluid communication, and reliable security give employees freedom. In addition, perhaps ironically, tools like virtual meeting rooms have also added a humanizing element to our work life—a window, so to speak, into our colleagues' lives that promotes social awareness in the workplace.
Health and wellbeing. There are countless tools available to help companies support their employees’ physical and mental health. “Studies have found…that wellness programs can improve employees’ performance, mental health, and self-efficacy, and deliver other self-reported health benefits,” McKinsey reports. A wide variety of health and fitness programs have moved to virtual and digital formats, and these “now account for the majority of employer-sponsored health offerings.”
Lukasa’s veteran business and technology experts take a partnership approach to every project. We’re on the inside, working side by side with our clients’ teams to gain a comprehensive understanding of each company’s objectives, needs, and pain points. We’re here to ensure that the strategies and tools of your digital transformation initiative work for everyone—bolstering employee experience and fostering the engagement that will move your enterprise toward its greatest goals.
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