by Flex HR

5 ways essential elements of HR affect employee retention and job satisfaction

Hire, train, reward, retain employee job satisfaction and employee retention servicesEmployee retention and job satisfaction begins with the organization’s employee acquisition and assimilation process, whether done internally or through hr outsourcing. Hiring the right qualified employees for open positions is an essential first step towards employee retention and job satisfaction. However, once new employees are effectively on-boarded, the factors impacting whether they stay and how content and committed they are become largely about the company culture and internal work environment.


There are 5 key core factors that need to be actively managed to build a highly productive and committed work force.

1. The Work Environment:

Generally, employees self-select into the work, or job they perform. Though, occasionally, a worker is forced by circumstances to take a job they do not want, for which they have no talent, or that is in an incompatible culture. When this happens there is a high chance of turnover. 74% of employees say workplace culture is important to them, according to Speakap, and more than half of employees were willing to go to a competing firm in search of a better culture. Vulnerabilities in this element occur primarily during 1) consolidation following an acquisition, 2) other reorganization and downsizing events, and 3) to a lesser degree during “employee development programs”. Whenever these occur, the organization becomes vulnerable to significant employee attrition and sagging morale. The best defense against these outcomes is to recognize the potential weaknesses and engage experts to help plan, execute and monitor the situation. HR professionals can take the form of seasoned line executives, and Human Resources/Organization Development staff experts who have a track record of success under similar circumstances. During these susceptible events, leadership is at a premium. Industry expertise is a plus, but change management experience in comparable situations is crucial. Most acquisitions and mergers fail to meet financial expectations with the root cause resulting in failure to recognize, and professionally manage the people aspects of the change.

2. The Supervisor:

Employees don’t leave companies so much as they leave supervisors. Employees said managerial support was the most important aspect of company culture and 71% would quit if another employer offered them flexible scheduling in a new job, according to ExecuSearch. Following the work environment, the supervisor is the most important constituent of employee retention and job satisfaction. Supervisory selection is critical to achieving a stable and productive workforce. Successful supervisors achieve productive synergies within the work group and across the greater organization. Some supervisory skills come naturally, while others must be developed. To capitalize on the benefits of great superiors, organizations must identify supervisory talent early, select based primarily on their people skills, continuously invest in emerging supervisory and managerial skills, and purposely reward outstanding leadership behavior.

3. The Work Group:

The day-to-day work group is the next most important element of employee retention and job satisfaction, behind the supervisor. Ideally, employees are motivated to come to work and contribute to support their teammates. Work groups that enjoy and support each other (creating a felling of community and even family) are considerably more productive than work groups in conflict. One of the most imperative roles of the supervisor is to foster a dynamic and congenial staff. Company leadership will benefit by periodically conducting employee satisfaction surveys that include feedback filtering down to the individual supervisor, and by making, selecting and developing great supervisors as a high priority.

4. The Organization’s Mission:

Employees, who feel they are part of a company mission greater than themselves, are more likely to stay employed and be productive. Again, employee engagement surveys can help identify key determining factors. However, the quick and immediate solution is to talk to employees and ask them, “why is what we do important?” and “where are we heading as an organization?” In a strong culture with a clear mission, there will be significant similarities in the answers provided. Organizations who want to bolster their mission transparency can do so. Clarity starts with the top executives documenting their goals and objectives, and then consciously communicating the direction and desired destination in word and deed.

5. Pay and Benefits:

Pay and benefits are the final key factors in attracting and retaining employees. Unless additional factors are at play, workers typically will not voluntarily move from one employer to the next without significant financial incentive. Pay is much more significant here than benefits. Employees typically do not consider changing jobs without at least a 10% increase in cash compensation. On the other hand, most employees will consider and even seek out a new job that pays 20% or more. Benefits must be competitive. SunTrust states that “45% of employers have raised pay rates and 43% of employers increased benefits in order to stay competitive attracting and retaining talent.” Therefore, working with HR benefits specialists is crucial. When benefits are significantly less than other comparable employers; benefits become a source of dissatisfaction and turnover. Finally, things change. Over time what works brilliantly today is constantly fluctuating given the circumstances. Building and maintaining a great work environment with highly productive and committed employees takes an on-going conscious effort. The only remedy that supports long-term success is to purposely monitor and measure your organization’s effectiveness in each of the top 5 essential elements of HR employee retention and job satisfaction, and to take corrective actions as needed.

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Philip A. Davis Senior Vice President Flex HR, Inc., a HR consulting firm.