April 19, 2023

Engagement as the Secret Sauce for Employee Retention

3 min read

Employee retention is a critical issue for any organization. It is not only costly to replace employees but also disrupts the workflow and affects productivity. While there are many factors that influence employee retention, engagement is one of the most important ones. Engaged employees are more likely to stay with their organization and be more productive, satisfied, and committed to their work.

In this article, we will explore why engagement is the secret sauce for employee retention and how organizations can create an engaged workforce.

What is employee engagement?

Employee engagement is the degree to which employees are committed to their work, feel a sense of belonging, and are motivated to contribute to the success of the organization. Engaged employees are passionate about their work, feel a sense of purpose, and are willing to go above and beyond to achieve their goals. They are more productive, innovative, and customer-focused than disengaged employees.

Why is engagement important for employee retention?

Engagement is important for employee retention for several reasons. First, engaged employees are more committed to their work and the organization. They are less likely to leave their job and more prone to stay with the organization for a long time. This is because they feel a sense of purpose and belonging, which motivates them to work hard and contribute to the success of the organization.

Second, engagement is linked to job satisfaction. Engaged employees are more satisfied with their jobs than disengaged employees. They enjoy their work, feel valued, and are recognized for their contributions. This makes them more likely to stay with the organization and less inclined to look for other job opportunities.

Third, engagement is linked to productivity. Engaged employees are more productive than disengaged employees. They are more focused, innovative, and customer-focused, which leads to better business outcomes. This makes them more valuable to the organization and more likely to be retained.

"Engagement is not a characteristic of employees, but rather an experience created by organizations, managers and team members".
— Ryan Pendell, Gallup

Engagement cannot be created through financial incentives, as these can be equalled or improved by competitors at any time, according to a Gallup study. Employee engagement is a true issue nowadays and whoever manages to keep the employees highly motivated and engaged, will implicitly also manage to achieve (according to the same Gallup study):

  • 10% higher customer loyalty
  • 23% higher profitability
  • 18% higher productivity (sales)
  • 14% higher productivity (production records and evaluations)
  • 18% lower turnover for high-turnover organizations (those with more than 40% annualized turnover)
  • 43% lower turnover for low-turnover organizations (those with 40% or lower annualized turnover).

How can organizations create an engaged workforce?

Creating an engaged workforce requires a comprehensive approach that involves several strategies. Here are some of the strategies that companies can use to create more engagement amongst their employees, that leads to a higher workforce retention:

1. Communication: communication is key to creating an engaged workforce. Organizations need to communicate regularly with their employees, share information, and listen to their feedback. This creates a sense of transparency and trust, which helps to build engagement.

2. Recognition: recognizing employees for their contributions is important for creating engagement. This can be done through formal and informal recognition programs, such as employee of the month awards, bonuses, or a simple thank you note. Recognizing employees for their contributions shows that the organization values their work and appreciates their efforts.

3. Development: providing opportunities for employee development is important for creating engagement. This can be done through training programs, mentoring, and coaching. Development opportunities help employees to grow and develop their skills, which leads to increased job satisfaction and engagement.

4. Work-life balance: creating a work-life balance is important for creating engagement. This can be done by offering flexible work arrangements, such as telecommuting or flexible work hours. Employees who have a better work-life balance are more likely to be engaged and satisfied with their jobs.

5. Feedback: providing feedback is important for creating engagement. Employees need feedback to understand how they are doing and how they can improve. Feedback should be constructive, timely, and specific. This helps employees to develop their skills and feel valued.

Final Word

Engagement has proven to be the secret sauce for employee retention. Engaged employees are more likely to stay with their organization, be more productive, satisfied, and committed to their work. Organizations that want to create an engaged workforce need to focus on communication, recognition, personal and professional development through constant training programs, work-life balance, and feedback. By introducing these key points into their strategy, they will create a workplace that fosters engagement and retention.

Engaged cultures are valuable and difficult to copy - the very definition of a competitive advantage.
— Ryan Pendell, Gallup

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Raluca-Mihaela Keeling
Marketing Director
Raluca is the Marketing Director at Apprendly. She is a passionate marketing specialist, with communication and language skills at her back. She loves writing, teaching, and investigating about innovative learning techniques. In her free time you might find her dressed like in the 20’s, dancing the dances of those times.