Startup businesses face a number of major obstacles in their pursuit to establish themselves and begin to compete with existing players in their industries. Besides finding initial investment and cashflow solutions, hiring the right people, and getting operations started, business owners often find themselves losing their most valuable employees in their first few months or years.

alternative finance and banks working together - Retaining star employees on a limited budget

The most common reason for this is money; small businesses don’t have the budget to pay great workers what they’re worth, so often, this talent will accept positions at more established businesses. Finding ways to keep those key players around is greatly important for businesses that are hoping to build both their reputation and the quality of their service to a level that will make them competitive in the long term. Let’s take a look at a few very important steps that you can take to help you retain the people you need.

Develop financial reliability

It’s important to underline that no employee will stay with an employer that doesn’t pay fairly and reliably (unless the employee has no other prospects, in which case, that’s a different problem). Keeping your business’s and your employees’ cash flow regular gives workers a sense of stability, and will help to alleviate any sense of income insecurity.

To make sure that you don’t run into cash flow interruptions it’s very important to build a solid relationship with your financial institution, and set up the tools you need to deal with any eventualities. Depending on your business’s particular situation that could mean opening a line of credit, setting up a free standby facility, using invoice factoring when appropriate, or any of a variety of other solutions.

Provide a sense of progress

Modern work can be synonymous with drudgery and boredom which isn’t solved with gimmicks and break activities; it’s because so many employees don’t feel that their careers or the work that they’re doing is progressing in any way. Finding a way to fill that need can ultimately motivate workers as much as their pay.

If there was any one way to solve this problem, everyone would be doing it. The solution depends strongly on what workers themselves would consider progress to be. The first step to dealing with it would be to simply ask. Those workers who are already motivated enough to do great work (and eventually seek other employment) generally have fairly concrete goals and ambitions. Find out what those are, and offer to help them find ways to progress within your organisation. For example, one employee might be looking for a way to get a few years of project management experience, while another might be looking to develop their technical skills in the industry.

Offer non-monetary benefits

Money is a primary motivating factor for all of us until our basic needs are met, and our standard of living is relatively normal. After that’s done though, work-life balance, a pleasant work environment, or other non-financial benefits will become important factors. Startups and small businesses can take advantage of this, by offering the flexibility that so many larger businesses can’t implement.

For example, some concrete benefits that are relatively easy to implement for a lot of modern businesses might be offering work-from-home options or flexible working hours. Something that’s been popular in Europe for some time, but that’s just catching on around the world now, is enforcing a rule of no after hours work emails to help support a healthy work/life balance.

This helps your workers keep their stress levels down, and empowers them to make more meaningful decisions about how they want to spend their time away from work, without costing your business a dime.

Offer rewards and positive feedback

Many of the most hardworking people in any organisation don’t feel that their contributions are being recognised, or that their work might even be entirely in vain. Employers generally remember to offer feedback to employees who are making mistakes or who are improving, but forget people who are already operating at a high level. It’s very important to provide regular feedback to great employees, even if their level of performance hasn’t changed, and even if there isn’t necessarily much to discuss.

It’s a good idea to punctuate this positive feedback with rewards, whether that means a bonus, a gift, or just being recognised in front of the team. Keeping this dialogue open gives workers a chance to communicate their thoughts, and helps to make them feel like a valued member of the team.

The cost of training a new employee, plus the loss of revenue that businesses often experience when a key team member leaves, is enormous. If you can take the time and make the effort to ensure that they feel secure and valued, and that they’ll be able to pursue their ambitions with your company, you and your business will be on the road to real, far-reaching success.

 

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