7 Key Employee Retention Strategies Every Business Should Implement

Posted by Paul Talbot
On 05/07

i 3 In This Article

Modern illustration showing a group of happy people in a work environment and demonstrating the importance of employee retention

Would your business thrive if you had to replace over one third of your workforce this year? For many organisations, this will be the hard reality – making employee retention strategies an essential focus. The concern is particularly great for small and medium businesses, as SMEs experience lower employee retention levels in general and are more vulnerable when staff leave.

High employee turnover is caused by a range of factors – more of which below – but whatever the reasons, it always harms the profits, productivity and culture of a business. So whether a business aims to thrive or just to survive, mastering employee retention strategies has become a critical feature of planning and operations.

This article will explore 7 key strategies that can significantly boost staff retention. By addressing these areas, organisations can craft effective employee retention strategies that not only reduce turnover but also promote a productive, engaged, and loyal workforce, ultimately helping to boost employee retention.

Understanding Employee Retention and Turnover

Reasons Why Employees Leave

There are many reasons people leave their employer, not all of which are relevant here. We won’t be talking about termination of contracts, mutual agreements or redundancy. Nor will we dwell on the personal reasons (sudden ill-health, etc) which good employers understand.

Instead, we’ll focus on the many resignations that are entirely preventable. Understanding the reasons why employees leave can help improve employee job satisfaction. The most common reasons include:

  • Feeling unmotivated and dissatisfied (15%)
  • Being stressed or overworked / poor work-life balance (14%)
  • Management don’t seem to care about wellbeing (14%)
  • Poor culture / atmosphere (14%)
  • Poor relationships with managers (11%)
  • Lack of career development / progression support (11%)

Statistical Insights

Taking a more detailed look at some of the numbers and employee retention trends, we can see that high staff turnover is a serious and pressing issue for organisations:

We can also see that worker retention is a concern for all business, but particularly SMEs. According to research, smaller organisations experience higher turnover than larger corporates:

  • 1 – 249 employees – 18.2% turnover
  • 250 – 999 employees – 15.4% turnover
  • 1000+ employees – 13.6% turnover

Impact of High Turnover

The average cost of replacing an employee starts at 30%, rising to 200% for top performers.

So it’s clear that losing valued members of staff can hit the bottom line hard.

But this isn’t limited to individual employees, because the effects can snowball. When a key performer leaves, the remaining employees often face increased workloads to cover for their former colleague. This can lead to stress and burnout, which can further deteriorate morale. They see one person leaving for a better deal, and it won’t be long before they’re waving goodbye, too.

In this way, a single resignation can quickly lead to a mass exodus that threatens the very survival of a business. Therefore, it is crucial to develop effective employee retention strategies to mitigate the negative impacts of high turnover.

Retention Strategy 1: Build a Retention-Focused Company Culture

Building Trust and Transparency

Organisational culture develops as a result of many individual components all working together – including values, leadership, and accountability. But whatever the components, if the foundation stones are trust and transparency, everything that’s laid on top is more likely to sustain.

Employees are more likely to feel valued, engaged and secure where they:

  • feel included in the direction and strategies of the business
  • enjoy a sense of autonomy in their work
  • feel they have a voice and will be heard
  • do not fear expressing doubt or dissatisfaction
  • feel trusted to do their job, perform and deliver
  • anticipate that their employer has their back

Managers can enhance transparency by being open to feedback, communicating clearly, and sharing information proactively. This openness not only boosts employee morale but improves collaboration and productivity.

Core Values and Mission Alignment

People are complex – each of us has different thoughts, values and priorities. Logically, then, employers should not expect their people to turn up at 9am, happily follow along with a rigid corporate mission, and then revert to their individual personalities at the end of the working day.

To create a cohesive work environment where everybody plays their part, all employee retention strategies should seek to align company values with employees’ personal values – or at least, to work together in the areas of overlap.

In practical terms, too many organisations produce a set of corporate values and mission statement as a tick-box exercise and then instruct staff to fall in line. Instead, businesses should seek to develop a set of shared values in consultation with their staff, as a joint enterprise.

When employees resonate with the company’s mission and values, they experience a stronger sense of purpose and belonging.

Creating a Supportive Environment

A supportive work environment is characterised by understanding and addressing the needs of employees, both individually and collectively. A supportive environment enhances employee satisfaction, which is crucial for promoting employee retention.

Individually, managers play a key role by conducting regular check-ins, offering constructive feedback, encouraging staff to develop and achieve their goals, and supporting them when times are tough – rather than continually adding pressure and targets.

Collectively, a business should create supportive structures with policies and frameworks that support employee wellbeing but also enhance retention by making staff feel valued and supported. Such approaches may include better employee benefits, family-friendly or flexible working policies, a generous sick pay allowance, career development and performance frameworks, employee assistance programs, staff networks, and workplace coaching schemes. Such approaches not only reduce turnover but build a more committed and productive workforce.

Retention Strategy 2: Support the Professional Development of Your People

Benefits of Professional Development and Career Planning

Professional development and career planning are pivotal in retaining employees – if they’re not in place, people resign.

Conversely, companies that invest in training and career growth frameworks often see a decrease in turnover rates. For instance, employees with access to career advancement opportunities and support with career progression are more satisfied and likely to stay longer at their company, as evidenced by a LinkedIn survey where 94% of employees expressed a preference for companies that invest in their career development.

As we’ve seen, gone are the days when a job was for life. So when your top performers decide to move on from their role, would you like them to bring their skills and experience to a new area within your business, or join the competition? And when they do leave, would you like them to give you a glowing Glassdoor review reflecting the internal mobility you offer, or warn top candidates away?

Workplace Coaching and Mentoring

However good they are at their job, in reality many managers lack the time and skills to give staff the specific support they need. Beyond this, many employees feel hesitant to tell their manager what they’re really thinking and feeling. And even if managers are well placed to help, a business is unlikely to have all of the relevant training opportunities in-house.

Coaching and mentoring fill this crucial gap, and can help businesses to implement all 7 key employee retention strategies in this article.

Employee empowerment is essential for long-term retention. By offering individual support to tackle stress and create work-life balance, coaching can help staff:

  • increase their resilience, wellbeing and balance to keep them happily in work
  • engage and participate actively in the goals of the business
  • thrive as members of high-performing, collaborative teams
  • maximise individual performance and productivity
  • achieve greater job satisfaction
  • plan and develop their career growth in line with the needs of the business

Consequently, businesses that adopt these employee retention strategies benefit from reduced turnover costs, enhanced morale, and a more stable, skilled workforce.

Success Stories from Leading Companies

This isn’t just theoretical; Google and SalesForce are just two examples of companies where coaching and mentoring have been instrumental in achieving high retention rates.

Beyond coaching, numerous leading companies have successfully implemented professional development programs. Heineken, for instance, runs a reverse mentoring program that allows junior employees to mentor senior leaders, providing fresh insights into the future of work. Similarly, Progressive has developed an in-house IT Programmer Bootcamp to reskill non-technical staff for technical roles, significantly enhancing employee retention and satisfaction.

These examples highlight the importance of professional development – whether via workplace coaching or more specific training programs – in fostering a committed and productive workforce.

Retention Strategy 3: Promote Teamwork and Communication

How Aligning Your Teams Will Help Retention

High-performing teams are more than just a bunch of people in the same room. And if a team isn’t working well together, it can be harmful to a business. From a retention perspective, we know the human factor matters – a lot. So if people aren’t happy with their team-mates, they could be more likely to resign.

Aligning team members with each other and with the company’s goals and values is crucial for fostering a positive work environment and enhancing employee retention. Often, teams need their own unique goals and mission statements to be fully effective – as we’ve seen, coaching can be instrumental here. When teams are aligned, they experience increased engagement, collaboration, productivity, and a sense of belonging, which directly contributes to higher job satisfaction and reduced turnover rates.

Improve Workplace Communication

As we’ve seen above, promoting open and transparent communication within the workplace is essential for maintaining alignment and preventing misunderstandings that can lead to conflict.

Companies that encourage two-way communication channels, such as town hall meetings, open door policies and feedback mechanisms, see higher retention rates due to increased employee engagement and satisfaction. Leaders play a pivotal role in this process by providing clear guidance and support, fostering a culture where employees feel valued and heard.

Act Fast to Resolve Conflict

Conflict can start small but escalate fast. What begins as two people not seeing eye-to-eye can quickly grow into a multi-party dispute – which can require more formal, lengthy and costly resolutions.

Where conflicts can be addressed quickly and informally, there is a greater chance of maintaining a healthy work environment and preventing the negative impacts associated with unresolved disputes.

For SMEs in particular, it is likely that existing staff do not have advanced conflict management skills, or if they do, they may already be connected to the dispute in some way. Bringing in external workplace coaches – or in more problematic disputes, mediators – can help prevent minor disagreements from escalating into major issues that can affect team dynamics and employee morale.

Retention Strategy 4: Enhance Your Employees’ Wellbeing

Stress, overwork and time management

It is now well known that chronic workplace stress leads to significant health and economic consequences. When individuals exceed their adaptive capacities, the resulting stress impacts their mental and psychological abilities and in turn their metabolism, immune response, and physical systems.

This stress response, while initially protective, can become detrimental, significantly harming people’s health and wellbeing and costing employers billions in work accidents, absenteeism, turnover, and healthcare costs.

Stress reduction should feature in all good employee retention strategies. The full range of options is beyond the scope of this article, but may include:

  • Leading by example
  • Coping skills training
  • Workload management
  • Time management and productivity training

Supporting resilience and good mental health at work

Building resilience is crucial for tackling workplace stress and enhancing employee wellbeing. Resilience not only improves job satisfaction and organisational commitment, but increases employee engagement.

As a result, work is a better place to be and employers benefit from higher productivity and lower costs. Implementing resilience training and supporting mental health through accessible resources and flexible work arrangements can significantly reduce work-related stress and improve mental health outcomes.

Actively encouraging work-life balance

The importance of respecting employees’ needs, both at work and at home, is a continuing theme of this article. Promoting work-life balance is essential for preventing burnout and enhancing employee retention. Flexible scheduling and respecting – or encouraging – personal time off are key strategies that help employees feel better and perform better. Promoting a healthy work life balance is crucial to prevent burnout and enhance retention.

Ensuring that work-life balance policies are inclusive and communicated clearly across the organisation encourages a culture where employees feel valued and supported, leading to higher job satisfaction and loyalty.

Workers are increasingly choosing a greater work-life balance over a higher salary – which makes work-life balance a primary battleground in both recruitment and retention.

Retention Strategy 5: Prioritise Employee Engagement and Satisfaction

Ways to Keep Employees Engaged

When staff are no longer engaged, they become bored or disillusioned. They no longer feel part of the culture or the mission – and, as human beings continually seek purpose, this means they’ll start to look for a new challenge.

Engagement is a two-way street. The employees need to feel motivated by the work they do – the individual tasks, the role, their colleagues, and the values and mission of the company. It is also important to encourage employees to take actions that improve their engagement and satisfaction.

Equally, leadership and management should drive a continuous engagement strategy, seeking to reach out proactively and invite employees to contribute to the development of the organisation, both within and beyond their established roles. Incentives, opportunities and benefits can form an important part of this strategy.

Personalities, Strengths, and Skills

Understanding the diverse personalities and strengths within a workforce is crucial for effective engagement and talent retention. Employees who are engaged with their work typically exhibit higher levels of job satisfaction and are motivated by intrinsic factors related to their roles. Aligning tasks with employee strengths has been shown to increase productivity and job satisfaction – for instance, employees who leverage their strengths daily are more likely to experience a boost in morale and engagement.

Of course, an organisation needs to know its people on a deep and granular level before it can achieve this kind of alignment. Of all approaches, workplace coaching in particular can be invaluable to help staff and managers identify and act on opportunities to align personalities with roles and activities.

Improving Job Satisfaction

The holy grail of retention! In simple terms, if people are happy in their jobs, it’s much less likely they’ll quit. Supporting physical and mental health is crucial for improving job satisfaction.

The factors that lead to job satisfaction include:

  • Personality-strengths-role alignment
  • Task variety
  • Physical surroundings
  • Colleagues
  • Subject-matter interest or expertise
  • Career development opportunities and challenge
  • Impact and making a difference
  • Recognition and reward

To start improving job satisfaction for employees, organisations should build on the personalised approach to personality alignment outlined above. By helping staff members to identify their personality traits, natural strengths and satisfactions factors – particularly through the use of workplace coaching – organisations can ensure their people work in roles where they’re likely to stay in post and perform well.

Retention Strategy 6: Raise Performance, Productivity and Confidence

How Achievement and Capability Affect Turnover

When employees perform well, it usually means they are happier, they are well-aligned with their roles, and the business enjoys greater success. Staff who feel they are achieving and performing well in their roles are more likely to remain loyal, using their growing knowledge and abilities to further the company’s objectives. Improving achievement and capability can also help reduce employee turnover.

Conversely, research indicates that career stagnation leads to complacency, a lack of innovation, and diminished work culture diversity – all of which contribute to increased turnover rates.

To help their people perform at their best, organisations should take steps to increase the positive performance factors – including engagement, alignment, and recognition – and cut down the negative factors, which include stress, pressure and micromanagement.

The Role of Performance Management in Retention

As with values and mission statements, performance management is too often a tick-box exercise. In this case, staff exist in a pressurised environment and dread their monthly, quarterly or annual appraisals. They know they’re a waste of time.

Done well, however, effective performance management is crucial for retaining and fostering top talent. It encompasses setting clear goals, providing regular performance feedback, and facilitating career development, which collectively enhance employee engagement and motivation.

Regular performance evaluations and feedback, where they’re genuinely constructive and encouraging, help employees understand their progress and areas for improvement. A culture of continuous development and performance management significantly lowers the likelihood of employees seeking opportunities elsewhere.

Why Confident Employees are More Likely to Stay

Confident employees, who feel secure in their abilities and know they’re valued by their organisation, are less likely to seek alternative employment. As we have seen above in Strategy 5, aligning employees’ natural strengths and personalities to their roles leads to greater job satisfaction – but it also helps them build essential self-esteem and confidence.

This confidence is often bolstered by effective communication, recognition of achievements, and clear articulation of role expectations and career pathways.

Sometimes, though, confidence can’t be created through strategy. Imposter syndrome is a common experience at all levels of seniority, and can seriously impact a person’s performance, career development and job satisfaction. To combat this, workplace coaching helps staff to build confidence and overcome imposter syndrome to benefit both the individual and the business.

Retention Strategy 7: Lead for Retention

Leading by Example

Going back to our very first of these 7 employee retention strategies, we know that trust and transparency are critical cornerstones of reducing staff turnover.

What people see matters. And if employees see their leaders saying one thing but doing another, those cornerstones aren’t in place. Transformational leaders, by actually walking the walk, show their staff that their organisation is a good place to be.

Employees need to see their leaders adopting the strategies in this article personally, and not just as a business tactic. They should see their leaders having personal lives, working with a coach, downing tools at the end of the day, joining training sessions and seeking feedback.

Creating a Feedback Culture

Effective leadership involves open communication and regular feedback, which are vital for employee engagement and retention. Feedback helps employees understand their roles better and motivates them to perform optimally, leading to higher job satisfaction and lower turnover rates. Moreover, a feedback-rich culture encourages a comfortable environment for employees to seek and receive feedback, essential for continuous improvement and career growth. Additionally, a strong feedback culture helps support employees by addressing their physical and mental well-being needs through constructive dialogue and resources.

But this goes beyond the issue of performance management. Feedback should include 360 assessments, too often the preserve of senior staff, but invaluable throughout the workforce. Beyond the individual, suggestion boxes, town halls and consultative policies all encourage open feedback and ensure staff feel heard and respected. And when employees do leave, listen to what they have to say – exit interviews offer unrivalled opportunity to understand what your staff really need.

Proactive Career Pathing

As we discussed above, it’s essential to support and encourage the career development of employees. But this goes beyond saying yes when staff ask for help – proactivity is key.

Leaders should be devising, offering and encouraging career development initiatives. These could include workplace coaching sessions for all staff or on a team basis, building progression and development frameworks, and offering relevant training opportunities.

Career pathing, a strategy that aligns employee career growth with corporate priorities, not only increases job satisfaction but also engages employees more deeply, making them likely to stay with the company.


Earlier in this article, we explored the nature of retention and turnover. This included why people quit and how this affects companies – particularly small and medium businesses, who have fewer resources in-house and are more vulnerable to staff departures. A well-structured recruitment process is crucial to ensure long-term retention by identifying candidates who align with the company’s values and vision.

Building on this understanding, we covered 7 key employee retention strategies can help organisations create and execute a retention plan to reduce staff turnover.

  1. Strategy 1: Build a Retention-Focused Company Culture
    By creating a supportive and values-led culture of trust, companies offer an environment people will want to stay in.
  2. Strategy 2: Support the Professional Development of Your People
    By offering proactive support with career planning and development, employers make sure their staff feel empowered to keep growing and set goals for a successful future.
  3. Strategy 3: Promote Teamwork and Communication
    As part of a high-performing, aligned team, where conflict is tackled quickly and collaboration is a given, staff will feel they’ve found their tribe – and won’t want to leave it.
  4. Strategy 4: Enhance Your Employees’ Wellbeing
    When they know their wellbeing is valued and looked after and their lives are well balanced, employees will feel happier, healthier and more resilient at work.
  5. Strategy 5: Prioritise Employee Engagement and Satisfaction
    When companies actively engage their people, they have the right people in the right roles, with greater job satisfaction meaning staff are less interested to look elsewhere.

    Strategy 5: Prioritise Employee Engagement and Satisfaction
    When companies actively engage their people, they have the right people in the right roles, with greater job satisfaction meaning staff are less interested to look elsewhere.
  6. Strategy 6: Raise Performance, Productivity and Confidence
    With higher productivity and a well-managed performance focus, people feel more confident in their roles and achieve greater things – in other words, they know they can fulfil their potential if they stay in the company.
  7. Strategy 7: Lead for Retention
    When the leaders of a company act as role models, invite feedback and proactively offer support, staff feel more confident they’re in safe hands.

In particular, we have seen how workplace coaching can play a vital role in any retention program that puts these strategies into action. This will be especially important for small and medium businesses, as SMEs are less likely to have the time and expertise to offer suitable support in-house.

These 7 employee retention strategies not only cement the foundation for a resilient and vibrant workforce but help to protect and raise an organisation’s bottom line. As businesses continue to navigate the complexities of the modern work environment, where competition for top candidates is intense and employer brand matters, prioritising these areas will be key to not only retaining top talent but harnessing their potential to fuel innovation and success.


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As a leader of an ambitious SME, you can’t afford to lose your top performers to the competition, or have their morale and productivity drain away. You know you need to invest in your people, but you just don’t have the time or the resources. We can help.

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