Retention Strategy free essay sample

Wally should notice that if turnover rate still increasing, this is threat to Wally’s company and it will fail to expand his strategies even will facing bankrupt in the future. Some argue that sometimes the employee turnover is good for weed out the lower level talent, but generally employee turnover is associated with cost (Anonymous 2008). Studies have shown that turnover rates can carry a price tag across the United States of $25 billion annually, with the cost of hiring and training an hourly worker at 300 to 700 times the worker’s hourly wage (Mckeown 2010). According to recent study, in every industry, companies face the challenge of retaining the talent (Siegfried 2008). Retention strategy is a challenge to organization and is the critical to the long-term growth and success of the business (Siegfried 2008). Retaining key talent and keeping productivity high will surely help the organization to succeed and get back into growth mode. Retention strategy is critically important for Wally to retain his employee to stay and work for him. Furthermore, the major issues in Wally’s case will be analysed and identify the major issues in the Wally’s case. This essay will focus on how to reduce the turnover rate in Wally’s company and give recommendations to solve those weaknesses to retain the employee stay. Identification of major issues According to a Society for Human Resource Management survey, the top three reasons why employees leave their organization are because they want better compensation and more benefits, they are dissatisfied with their potential career development, and the last, which they are ready for new experiences. In contrast, most general studies show that working conditions, development opportunities and recognition are all large contributors to employee retention. (Anonymous 2008) In the Wally’s case, the salary for the attendant’s job is the major issue. Attendants, which is a car washes worker and also responsible for maintenance and repair work on the machinery. In addition, attendants also needs to provide customer services by asking customer if they have any requests and try to fulfills all their needs. However, attendants start at a base pay of $12 per hour with small automatic raises at a month and one year. In the case, most of complaints from attendants are salary is not competitive relative to other full-services car washes or many other entry-level jobs in the area. Remuneration is pay and benefit that received by the individuals for their contribution to the company (Stone 2008). In the Wally’s company, pay is not relative even that all attendants must share equally in a customer tip pool but not according to their performance on the job. Better compensation or remuneration from another competitor has make the Wally lost the talent in his company. Most of the attendants willing resign their current job and go for the higher paid and better compensation than Wally’s company. Others than salary, the Wally’s company also gives the lack of appreciation, recognition, and reward to their employees. Reward need to give according to the employee’s performance but not just according to their ranking. Since the salaries is low, and Wally still provide little welfare to his employees. This disappointed the employees and lost the trust to Wally for did not provide anything welfare and leave then go for another company. People leave the managers more often than they leave the organization (Shilling n. d). Most of employees will leave the irresponsible managers and go for another good conditional workplace. In the Wally’s company, attendants receive brief training from manager before start working and most of the training from manager is hit or miss. Furthermore, manager also provide no feedback or coaching from attendants complaints, this may be disappointed the attendants. Wally also did not give any feedback according to his evaluation of the manager’s performance. So, the manager also will not know their performance, and do not how to improve their performance in the working place. Feedback is especially important in developing and retaining new hires as the effective feedback can helps them understand what they are doing and builds the confidence and helps them to improve their performance (Branham 2005). Exit interview is very important to help organization to ascertain the reasons why people are choosing to move on (Lanigan 2008). Exit interviews with departing employees are to provide valuable information that can use to retain remaining staff (Holbeche 2003). Wally did not conduct any exit interview when the employees leave the company. The information was left by the employee always be forthcoming with information for fear of leaving on a bad note. Most of the complaints from the attendants are unreliable and Wally simply believes this without do any further investigation. Possible solution The greatest retention challenge is not how to reduce turnover. Rather, it is how to create such a deep, unified commitment to the organizational vision that employees will be reluctant to server that bond (McCampbell, Stinchcomb and Leip 2009). Patricia, Schuster and Dertien state that: â€Å" Fast-growth companies have chosen an integrated view of total compensation and total rewards. They focus on career growth, including career opportunities for all employees, career acceleration for key talent, and technical career-tracks and skill-pay programs.