According to the US Gallup Job Creation Index, job creation is at a nine-year year high. While some employees are toasting their abundant job opportunities, business owners suffer tighter hiring markets and higher turnover.
High turnover can quickly damage your company’s bottom-line through increased hiring costs and lost employee productivity.
Most business owners just chalk up as the new “cost of doing business.” The good news is that you can reduce and even avoid much of the impact by adopting a few important strategies.
Here are five effective strategies for business owners when turnover is high:
1. Identify and appreciate the top talent you have today.
When you are playing “whack a mole” trying to fill the gaps you have, it’s easy to forget to notice the terrific talent you have today.
Apply the 80/20 rule. Which 20 percent of your employees are responsible for 80 percent of your company’s results? After you take the time to identify your best; then apply the second strategy below.
2. Develop a focused strategy to retain top talent.
Focus your retention efforts primarily on your top talent to generate maximum impact. When turnover is high, it’s tempting to spread a retention program across all employees-like increasing wages across the board. This lessens the impact, wastes valuable resources, and can result in retaining the wrong employees.
For example, proactively initiate stay interviews with the employees who consistently deliver versus with all employees with long tenures.
3. Establish a “promote first” strategy.
The most cost-effective way to fill open positions and retain top talent is to promote from within. Adopt cost-effective training methods to level up your first-level and mid-level leaders so they are prepared to move into higher positions.
Start by developing succession plans for all levels of the organizations from first level managers all the way to senior level positions.
4. Tackle your talent gaps.
Once you begin developing succession plans, you will quickly notice where you are “light” on future leadership. Face your talent gaps head-on.
Identify them early and get them on the radar with your team. Nurture your current up-and-coming talent to fill the void, and adopt strategy five below.
5. Build relationships with top performers at other companies before you need them.
Maintaining a potential pool of candidates will make hiring faster and easier when you have an opening. Take a long-term approach to succession planning by identifying and periodically staying in touch with these individuals.
Start by creating a database of qualified external candidates for your biggest area of need.
P.S: Download my free report, 7 Strategies for Senior Leaders To Get the Most Out of Their Workforce
A modified version of this article originally appeared in Ben Fanning’s Inc Magazine column