Employee Retention: A challenge for most companies in Ghana

Dr. Mrs. Ellen M. Hagan

In recent times, it has been realized that more often than not, it is no longer surprising to call a client to finish up a business transaction only for a colleague in the office to tell you “he is no longer working here.” Employers in Ghana and indeed globally are realizing that despite very interesting remuneration packages and beautiful work conditions, employees do not stay employed in one organization for long. Losing employees, especially highly productive ones (which we call “high flyers”), and replacing them is costly to the organization. 

It is clear, though that something ought to be done to prevent turnover, when it can be controlled.

Employees in the 21^st century want much more – such as:

•  The prestige of working for a respected and successful organization  
• Opportunities for personal development and growth
• Enjoyment and meaning in their work - feeling they can count for something
• Commitment to quality 
•  To know they make a difference - not just to the corporate bottom line but to the community in general
• The knowledge that their opinion counts for something, A shared sense of purpose and belief in company values

Employment relationships have evolved from being hinged on loyalty to what we call the new “21^st century employment relationship.”

“The new contract is based on an exchange.  When you can no longer rely on trust, you need something more specific as a basis for a relationship. One thing you can do is to have something that the other party wants and is willing to pay for.”  (Dibble, 1999) It appears today, that companies actually pay cash to their employees to win this commitment, under a euphemism – “retention or commitment fee.”

The difference between one job and another may not be significant, but it might appear to be so, especially where the people are looking out for change in other aspects of their life.  So long as there appears to be change, for example one’s level of authority being increased in a new job, people will move to embrace that change.   

People of all ages are seeking something better, or at least something different. A rising tide of dissatisfaction with many aspects of life has inspired people to look more eagerly for the grass on the other side of the fence so people will continue looking for the end of the rainbow.

On the contrary, low turnover may not always be a good thing.  It could point to employees who are not ambitious perhaps because of lack of confidence in their abilities, level of education, or an unwillingness to go through the trouble of proving themselves elsewhere.  This discourages them from searching for employment elsewhere. Therefore, high turnover may not necessarily be bad because the reverse might very well mean that the employees are not employable elsewhere. A company cannot move ahead with employees with this kind of mindset where they are content with mediocrity. It is important then to decide on particular people who are considered the most suitable where attitude and synergy with the values and vision of the company are concerned and make it worth their while. 

The causes of employee turnover have become multifaceted and the solution to staff turnover, which is also complicated, works differently for different people in different environments.  The retention of employees has to be tackled strategically.

Defining “Employee Turnover”

“Turnover is the rotation of workers around the labour market; between firms, jobs, and occupations; and between the states of employment and unemployment.”

A company is only as good as the quality of its employees, and keeping good workers at all skill levels is getting more difficult. The media laments the speed with which companies downsize and fire workers, but the reverse also occurs. Employees today switch jobs more quickly than they did a few years ago. Indeed, workplace loyalty is not what it was.

Employers in Ghana keep asking: How do you meet the challenge of retaining the people you need when they come in such a great variety and have so many interests?” Based on effective performance management systems, employers can have an idea of high performers and average performers and reward them accordingly, giving them interesting compensation packages and rewards. But, no matter what employers do, turnover is seen as inevitable.

A retention strategy that may work for a majority of employees in an organisation might not necessarily work in the same organisation for some category of employees.  The question still remains - what should employers do to keep a winning team together? It is clear that these times are critical as employers are literally fighting over the same talented employees – to be able to retain such employees involves financial as well as non financial initiatives.  While some talk about a change in attitude of employees where loyalty is concerned, others attribute the job-hopping nature of employees to economic instability – employees are now used to changing jobs whenever it is economically convenient or viable.  Can this trend be reversed or has this situation come to stay?    

What Measures can be put in Place to Prevent Employee Turnover?

A lot of research has revealed that one size does not fit every environment with regards to how to prevent employee turnover. It must be clearly established that in the world of business, there could be numerous reasons, some of which go beyond the current employment, that cause an individual to stay in a particular organisation or not. For example, someone may be considering starting a company even though the person may be currently an employee. A reason like this goes far beyond a retention strategy and is based on the ambitions of the individual. Let us consider some tried and tested suggestions according to empirical study as to how to keep a winning team together.

Job Variation

Employees tend to get bored with doing the same thing all the time. They enjoy variations in their work. This is what makes humans different from machines. The dynamic nature of man must be evident in business such that even if the nature of one’s work is constant, job rotation then could be the solution. Younger employees must be constantly challenged and stretched through new or evolving assignments and roles.

Clarity of Job Definition

When new recruits are accepted into the organisation, the intricacies of their job description must be verbally explained to them in an orientation programme that includes the interface between their role and other members of the team.  In addition to this, their job description is typed out and added to the new employee’s letter of appointment.  Their targets are subsequently developed from the expectations and outcomes of their role.   This allows employees to be very clear about their role in the organisation. 

Job Prospects

Personal development is a need to an employee. “Any staff will look for prospects in the organisation he/she is working. He or she asks various questions such as ‘can I move up in my career whilst at work. ‘Will I get promoted to enhance my CV? ‘Will I get fulfilled in terms of rising to the top?’ These are questions that an employee is likely to ask which will be a basis for his or her continuous stay in the organisation.

Continuous Increment in Salary

Salary is key to retaining employees. The joy of an employee is that in a particular period there will be a pay rise and this pay rise is timely such that employees may not have to cry for an increment before it is done. Inadequate salary is the easiest excuse for exiting employees, and even though a good salary is important, it is not the answer to retention. The lack of a proper reward system leaves much room for improvement. This is not surprising as employees always want more salary. Ideally, salaries must target a total reward that is competitive in the top quarter of the market and base pay at mid-market level. 

Implement a competitive compensation package

Having talked about salaries, studies have argued that employers may have to give employees benefits that will transform their lives, and in so doing, acknowledges that money will not be the critical factor that will retain employees. Paying a competitive salary “just keeps you in the talent game, it does not win the game.” Indeed, a pay increase usually increases the performance of employees only for a minimum amount of time before they go back to square one.  It is essential to pay a total reward that is competitive in the top market level. A total reward system should not only include a competitive pay but also staff benefits (medical care, insurance, attractive retirement packages), effective measures for work life balance, performance recognition, opportunities for career growth in form of tuition assistance, mentoring programmes,  etc.

Employee Involvement

Employees can identify themselves as stakeholders in the organisation. This is shown in their reaction when their ideas are being listened to, combined with opportunity to think through challenges and solve them. This strategy is in line with early thinkers such as Maslow and many others who concluded that employee involvement will develop a more productive force.  Involving employees in organisational policy-making will enhance employee motivation and commitment. There is nothing so enriching as your superiors believing in you.

Training

Career development is a primary concern for most employees. Training should be given to people whose inadequacies show in their evaluation.” Lack of training affects job satisfaction. It is really demoralising for an employee to be unable to perform a duty due to a knowledge/skill gap about the particular task.  Learning and employee development thus help retain employees and create organizational “stickiness.” Learning provides the new social glue. A learning environment is not only important for retaining employees; it is also critical for attracting talent.  It is also recommended that the training methodologies be varied from time to time, using more formal and conventional training sessions which the employees will more readily appreciate.

      

Decentralising the ‘power house’

Management must take a decision whether the time is now ripe to empower identified people to help carry the mantle. Decentralise the system of operation in order to facilitate the response time to issues. This will give employees the necessary power to operate. Next-generation employees do not want to wait 20 years before they get a piece of the decision making. They want to be partners in the enterprise now.

    

Provide information about industry specific remuneration packages

Companies should make available industry-specific salary surveys in order to give employees a realistic basis for comparison.   If a deliberate effort is not made in giving employees an orientation as to what is happening in the industry, management would be leaving it to the grapevine to decide what is fair and what is not where the question of competitive salary is concerned.  This will not auger well for the company as many of the employees may benchmark salaries from different industries and therefore, compare oranges to apples.

Get involved in re-recruiting employees

In the same way new employees are encouraged to come on board and the companies are presented to them as the right place to be, we should engage our high flyers in continuous discussions to find out their dreams and involve them constantly in such a way that their place of work continues to be attractive to them. Performance review systems can serve as a good channel to align employee goals with their current roles at the workplace. Using this method, a plan is put together with the employee, to support their dreams whilst performing their daily duties on the job. This allows the employee to put into perspective the company’s interest in their ambitions and the willingness to partner with them to achieve this.

Conclusion

I would like to summarise by throwing some light on 3 types of generational workers: Boomers, Gen X and Milleneials. Boomers with their years of experience are more adapted to hierarchy, valuing independence, loyalty and a formal management style. Gen X’ers, a sceptical but hard-working group very focused on upward mobility are loyal to themselves, and demand work-life flexibility. Millenials, the youngest group prefer to work collaboratively, expect to progress quickly in their careers but aren’t always in agreement with senior management on the path. They value innovation, are loyal within their peer group, value social interaction and see work as a means to an end. This group forms the majority in most corporate environments.

As we can see, these are a very dynamic group of people with varying expectations of what an ideal workplace should be and what may affect their decision on mobility. There is no best fit system to retain employees. We must first of all understand the people we work with, their needs, expectations and ambition. Only then can we offer a deliberate strategy to ensure that a winning team is put together for the maximum length of time feasible with the acceptance that no matter what you do, no matter how well employees are handled, they will leave at some point or other. There is, however, some separation that could be controlled or prevented, if handled with precision and with a plan that is kept varied.

By Dr. Mrs. Ellen M. Hagan, 

Chief Executive, L'AINE Services Ltd

At  IHRMP