A Comprehensive Guide to Staff Retention

Editor's Note: Take a look at our featured best practice, McKinsey Talent-to-Value Framework (230-slide PowerPoint presentation). Curated by McKinsey-trained Executives Unlocking Business Excellence: The McKinsey Talent-to-Value Framework Toolkit In the dynamic world of modern business, staying ahead of the competition means maximizing the potential of your most critical asset – your people. The **McKinsey [read more]

Also, if you are interested in becoming an expert on Human Resource Management (HRM), take a look at Flevy's Human Resource Management (HRM) Frameworks offering here. This is a curated collection of best practice frameworks based on the thought leadership of leading consulting firms, academics, and recognized subject matter experts. By learning and applying these concepts, you can you stay ahead of the curve. Full details here.

* * * *

Between 2002 and 2008, I was employed by British Telecom as the Central Regional Sales Director.  This afforded me the ability to influence, coach, mentor and deliver results through a staff of over 300; across 2 call centres and Field based consultants.  I wrote this article a few years ago but never published it, but I feel it is relevant now as the increase in the economy generally increases attrition rates.

 Just to set the scene, my call centres had an attrition rate of almost 37% when I took responsibility in 2006, but following the following principles below, I was able to reduce my annual attrition to below 15% with less than 4% annual absence records.  This may sound high to some but for a Call centre environment this is fantastic!

Recruitment – getting it right from the start

It is essential when recruiting that the correct competencies and behaviours are defined in order to deliver your business’s requirements.  Once the potential applicant’s skills and capabilities have been rigorously tested, you ensure that applicants gain a thorough understanding of the operation.

Welcome booklet

Applicants listen to calls, tour the operational floor, meet current employees, ask questions about the business and take away a welcome booklet that provides them with lots of information about the company.  I believe honesty is the best policy, and after the recruitment process applicants have a very clear picture of what it is like to work for you.

Refer a friend

I have refined my recruitment and on-boarding process over time and have seen the difference reflected in improved employee retention, especially during the first six months.  By taking a rigorous approach and selecting candidates who meet my competencies and behaviours and those people who would be most comfortable working in a call centre environment, I have become a preferred local employer, with many of our employees having been referred to us through our refer-a-friend scheme.

Reward – be innovative and demonstrate commitment

One of the most often overlooked aspects of helping to reduce attrition is reward, mainly due to the long period of time some schemes can take to show any reasonable return on the investment.  However, implementing lifestyle reward products can help to encourage people to remain with your business.

Flexible benefits

A flexible benefit scheme, or flex, is one such product.  This can be billed as a lifestyle product allowing the employee to use their salary to purchase benefits relevant to their lifestyle.  Whether they are a single parent in need of childcare vouchers or a more mature person who wants private medical cover or a recent graduate who still has itchy feet and wants to buy more holidays, the options and flexibility is there for all to use.

Regular incentives are vital when motivating and rewarding people.  A clear line of sight between the target and the reward is essential.  Is doesn’t matter if the reward is a bottle of wine, a  box of chocolates or an LCD TV, people enjoy being rewarded and if they believe the target is achievable everyone will strive to meet it.

Extra holiday entitlements

Don’t be afraid of being innovative and bucking the trend.  Sometimes being brave and investing more in your people can bring its own rewards.  Contact centres generally offer holiday entitlements in line with the statutory minimum. BT was no different, but I recently introduced a discretionary holiday policy over and above their contractual holiday entitlement.  This enabled employees to gain up to an additional 7 days’ holiday entitlement based on achieving satisfactory performance and attendance standards and certain service durations.

The initial cost of extra holidays was minimal in comparison to the rewards gained from reduced absence, reduced attrition and increased productivity.  This also meant that I could control the scheduling of the time off as opposed to reacting to unplanned sickness absence.

The discretionary holiday policy is assessed every year to determine if the benefits continue to outweigh the investment.  The scheme has been a great success for the last two years and I have seen increases in performance, a reduction in absence and improved attrition rates.  Employees view this as a great benefit as it helps them to manage their lives more effectively.

Call centres are often a very sociable environment where people who work together also socialise together after hours.  Employers can tap into this culture by offering rewards for referring a friend.  This not only rewards employees for encouraging like-minded friends to apply for jobs but also reduces the amount spent externally on advertising, recruitment agencies, etc. BT offers a referral scheme that increases the amount paid to employees successfully referring large numbers of friends.

Recognition – find out what people want

Due to the repetitive and often boring nature of the work in a call centre, having formal development plans in place and regular opportunities for people to progress ensures commitment.  When people can see that they have a career and not just a job their perspective often changes and they realise the contribution and difference they can make to the business.  These are the leaders of the future and should be recognised accordingly.

Identify why people stay

Identifying the reasons why people stay with BT enabled us to tailor our recognition schemes to meet the needs of the employees.  BT uses two methods to achieve this; my VOICE and my VIEW.

Employee forum (my VOICE)

In 2006, the my VOICE employee forum was created and has been successfully used to engage with employees.  As well as the many topics discussed on a regular basis, the forum provides an ideal source of information about the needs and wants of employees.  Often BT shares new initiatives with the my VOICE forum to determine whether it will work but also to gain buy-in and support for launches.

Employee satisfaction survey (my VIEW)

The employee satisfaction survey my VIEW has generated much information about recognition over the years and has been used effectively to help the business shape its programmes.  For example, BT launched two new schemes, new starter of the quarter and employee of the quarter, both schemes form part of the employee of the year scheme.

Pillow moments

We understand that people prefer to be recognised in different ways and we try to develop initiatives that reflect this. Every Friday is dress-down day and pillow moments allow an employee to have either an extra hour in bed or an early leave on their birthday.

Thank You cards

We issue Thank You cards to recognise above and beyond contributions and Santa visits the office in the 12 days before Christmas. Our employees really appreciate our efforts to say thank you in so many different ways.

Our current attrition rate has reduced by 20 per cent over the last three years.   Absence levels have been below 4 per cent over the same period and over a third of employees have in excess of five years’ service with the company.

The leader’s role in retaining staff

Sales-focused organisations, particularly call centres, are known for suffering from unacceptably high attrition rates of 20%.   A recent Call Centre Helper article revealed alarming retention facts including:

• Over 50% of the people recruited into an organisation will leave within two years.
• One in four people recruited will leave within six months.
• Approximately 50% of organisations experience regular problems with employee retention.

If you think you have a retention problem you need to follow the thread back to the source.  There is a view that it is impossible to identify the one single cause to any problem – and that is certainly true of retention.  At least two of the places you need to focus on investigating include the recruitment process and the way you attract people through an engaging employer brand.

What is it really like to work in this call centre?

Be very honest.  Is that what it’s really like to work in this organisation or this call centre?  Do people really get what they were ‘promised’ by the reputation of the organisation?  Are new joiners surprised by what it’s like to work under the pressure of sales targets and exacting performance standards?

As for recruitment, how good a job do your managers do to really make sure that people are given as full and as accurate a picture about what it’s really like to work in your organisation?  Are your managers sufficiently well skilled to make the best decisions about who to hire?

Make sure you match interview promises

Many people leave organisations because the things that were promised at interview, either implicitly or explicitly, never really materialise.  Make sure that your messages are congruent and your managers are highly skilled in recruitment and selection. This means focusing on the right questions in interview but also ensuring that managers also test the behaviour and skills of interviewees.  Do they take time to fully explain the sales targets or explore the extent to which someone one is resilient in the face of not achieving targets?

Competency-based interviewing techniques

When recruiting staff consider competency-based interviewing techniques rather than technical or skill-based questioning.  For example, it would be more important to find out whether a prospective employee could demonstrate that they had showed resilience in the past, rather than their technical abilities to use a CRM system.  The technical skills can be trained.

Understand the scope of the problem and get the data

The first thing to realise is that you can’t hold on to all of the people for all of the time. People will leave.  However, without sounding too cavalier, you need to make sure your leavers are the people you can afford to lose and not those with high potential, or those with specialist skills, or those who have just had a whole heap of development.

Why are people leaving?

Exit interviews are still the best way to get this information.  You may find the data you get back challenges some of your own assumptions about whether career progression exists, or whether the shift patterns that operate are really the issue.

Linked to this, how are people feeling about working in this organisation?  Staff engagement surveys will give you valuable data about how people are feeling.  These can be comprehensive surveys or short ‘pulse’ surveys but will give you crucial information about what issues you may need to address:

• Which managers are best at holding on to their staff?
• Which managers have a poor track record?
• What’s the age range of leavers?  Length of service?
• Do particular roles or functions or locations have higher turnover than others?

Once you have your data, then you can work out a specific strategy. But beware, many companies fail to ‘go public’ on feedback so make sure that as a leader you communicate and celebrate the good feedback as well as creating strategies for improving and changing the bad.

Have a broad-based and proactive strategy

Effective retention depends on a long-term approach, and leaders should continually be thinking about broad-based proactive efforts to retain their talent.

Are you flexible?

Are you being as flexible as you can be as an employer?  For example, research shows that companies who offer different shift patterns, and recruit staff to fit certain hours have better retention than those companies who have one or two shift patterns, and force these upon employees after recruitment.

Develop your managers and leaders

We know that people leave managers rather than organisations as managers have the most direct impact on employees.  So the quality of your leaders and managers is vital to retention of staff.

Recent leadership research indicates that people will follow – and continue to follow – a person who inspires them and seeks to get the best out of them.

Are you developing leaders and managers who create meaning, who engage people and who people want to follow?

We also have more loyalty to leaders and managers who are authentic.  This means developing managers who have a deep level of self-awareness and an accurate picture of themselves – who know their own strengths and development gaps, who understand their impact on others.  And, most importantly, who act in accordance with their values and beliefs, i.e. they walk their talk.

And on a skills level, are you confident that your managers are both skilled and confident in the core areas of setting objectives, creating accountability, coaching, identifying and enabling potential, having tough conversations… because to retain people in a busy call centre, they certainly need to be.

Want to Achieve Excellence in Human Resource Management (HRM)?

Gain the knowledge and develop the expertise to become an expert in Human Resource Management (HRM). Our frameworks are based on the thought leadership of leading consulting firms, academics, and recognized subject matter experts. Click here for full details.

The purpose of Human Resources (HR) is to ensure our organization achieves success through our people. Without the right people in place—at all levels of the organization—we will never be able to execute our Strategy effectively.

This begs the question: Does your organization view HR as a support function or a strategic one? Research shows leading organizations leverage HR as a strategic function, one that both supports and drives the organization's Strategy. In fact, having strong HRM capabilities is a source of Competitive Advantage.

This has never been more true than right now in the Digital Age, as organizations must compete for specialized talent to drive forward their Digital Transformation Strategies. Beyond just hiring and selection, HR also plays the critical role in retaining talent—by keeping people engaged, motivated, and happy.

Learn about our Human Resource Management (HRM) Best Practice Frameworks here.