Elements of Employee Retention

When employees are happy, sales growth, productivity and overall work quality improve.

Employee Retention

Reducing talent attrition has become a hot topic amid the Great Resignation, as employees in all industries are raising their voices for change. Employees want flexible hours and the ability to choose to work remotely or in a traditional office based on their genuine needs to care for family members and create a better work-life balance. Trying to enforce the pre-pandemic practices of Monday through Friday 8 am to 5 pm office routines isn’t sustainable for most businesses today.

For a company such as Aurora Payments, a national merchant services provider, the matter of retention is of utmost importance. Focusing on partner success, developing personalized relationships and providing white-glove services have been three mainstays of the company’s consistent growth since 2005. Aurora’s CEO and director of human resources recently shared several human capital management best practices that IT solution providers can apply to their businesses.

Relationship Management

Aurora is partnered with numerous software and app development companies to provide back-end credit card processing within specialized point-of-sale software for specialized industries such as ground transportation, jewelers, funeral homes, and sporting goods stores to name a few. The company serves as the endorsed credit card processor for trade associations such as funeral directors, jewelers, and limo associations. These relationships are developed and cultivated through personal relationships between Aurora’s account executives and Executive Directors of associations. An employee directly responsible for a trade association relationship can upset the apple cart if they resign. The collapse of an endorsed association partnership could mean the loss of hundreds of the association’s members.

HR Management

Employee retention is a top priority for Aurora’s CEO, Brian Goudie. In Goudie’s opinion, retention begins with the hiring process. “Hiring begins under the direction of an HR professional. An experienced HR manager understands the importance of gaining insights from prospective employees in what they seek in a new job,” says Goudie. Understanding this is key to ensuring longevity. According to Martin O’Mara, senior director of human resources for Aurora, another key to retention is having good people managers. “The relationship between the manager and employee is critical to building trust and nurturing performance on our various teams,” he says. It’s equally important to document why employees leave. Is there more turnover in one department over others? Perhaps the problem lies within the department management. Exit interviews are very important to maintaining a healthy and productive work environment. They allow you to identify concerns that repeatedly cause employees to leave.

Defining Retention

Employee retention refers to strategies and processes used to keep talent and reduce turnover. According to O’Mara, employee retention and turnover are leading workforce management challenges and create significant operational costs that compromise growth and profitability. Typical reasons for departing include finding a better job, moving out of the area, returning to school, or retiring. Under the new landscape of employment, employees have expectations to work remotely, have financial assistance and time off for continued education as well as work conditions that are much different than previous generations of workers. It is estimated that nearly $1 trillion dollars are lost each year due to employee turnover. Many workers say their managers or company could have prevented them from leaving by meeting their expectations.

Why Retention Matters

According to O’Mara, the cost to replace an employee can range from one-half to two times an employee’s annual salary. This includes the cost of recruitment advertising, interviewing, background/drug screening, onboarding, and training. Companies that fail to prioritize retention will suffer through financial losses, lost productivity, customer service problems, relationship damages and morale issues with employees who watched their co-workers depart. Aside from the lost connections, the remaining employees may have to take on heavier workloads or duties. As a result, they can become so disenchanted that they leave as well. When employees feel valued and supported it can lift morale and enable greater connected feelings and engagement. When employees are happy, sales growth, productivity and overall work quality improve.

Engaged Employees and Satisfied Customers

O’Mara asks managers to have routine one-on-one meetings with their employees to review workloads, achievements, and successes, as well as discuss issues, problems, and obstacles. “We conduct routine employee engagement surveys to measure how employees are feeling about working for Aurora,” says O’Mara. Surveys are open content with prescribed actions for issues our employees raise. “We firmly believe that there is a correlation between an engaged employee and a satisfied customer,” says O’Mara. Goudie adds that team-building activities are extremely important to retention. Aurora hosts team-building experiences such as Happy Hour with Trivia, a laser tag competition, and a “Smash Room” stress reliever. It also participates in park cleanup days. Aurora is currently developing Short Term Incentive Plans (STIP) to help stimulate and improve overall employee performance. Both O’Mara and Goudie firmly believe another key retention tool is paid time off. “It’s vital for employees to have the ability to get away from work and recharge their batteries,” says O’Mara.