Employee retention is a hot topic as the economy slowly improves and employees’ job options are increasing. A lot of the big-name tech companies, like Google and Facebook, focus on compensation, benefits, and perks to keep their employees happy. But startups, who are often hard up for cash, can’t really use that as an incentive – subsidized massages and an in-house basketball court just don’t fit into the budget for most of us.
So how else can you keep your employees happy? Lucky for bootstrapped startups, cash isn’t king when it comes to employee retention. Using financial incentives to entice employees just guarantees one thing: they’ll leave when they get a better offer. While your startup should strive to fairly compensate your employees, throwing them bonuses isn’t going to keep them loyal to you through all the stress of potential failure and having to hear your team members bicker about some minor coding error for the thousandth time.
Here are some tips to help your employees realize that the grass is pretty damn green on this side of the fence.
1. Foster a Positive Culture
This is the biggest portion of retaining employees at a startup – having a culture that lets employees feel valued, important, and like they’re truly a part of the company.
There are tons of articles on what makes a great startup culture, but the key points here are: keeping your employees in the loop about how the company is doing, celebrating big (and small!) successes together, asking for honest and direct feedback, and addressing complaints and inequities. A positive culture will help each employee feel like part of a team, instead of just another code monkey.
2. Find Creative Ways to Reward Employees
Recognize – and find creative ways to reward – those who go above and beyond, or who simply do a great job. When we think reward, we tend to think cash money, but it doesn’t have to be tangible or financial. Instead of a bonus, tailor rewards to the individual. Maybe your HR guy is a huge musical fan, and you can get him tickets to that show he really wants to see. Keep in mind though that most of the time, what your staff needs is simple: positive feedback.
3. Understand Why Your Employees Leave
When an employee leaves – and no matter what how killer your startup is, it’s going to happen – take the time to figure out why. The only way to fix the problem is to understand the root of it.
Ramon Nunez, CEO of LiveHive, started having sit-downs with departing employees and found out that most of his employees were leaving because they didn’t feel like they had an opportunity to grow with his company… Which brings me to my next, and final, point…
4. Provide Opportunities for Advancement
In many cases, employees leave because they didn’t feel like they had the opportunity to grow in the company. As I once told an employer, a dead end job is a dead end job whether it’s for a social work agency, a nascent startup, or a fast food restaurant.
Nunez emphasizes this as one of his key strategies: “It’s important to make sure that your employees understand that there are opportunities in the company. When there’s an opening, make sure they know there’s an opening. You have to understand what their career paths are, what their goals and aspirations are, so that you can help them be successful in their careers.”
One of your jobs as an employer is help your employees grow, learn new skills, develop professionally, and progress towards their goals. It’s basically Dan Savage’s “campsite rule’ – leave someone better than you found them – but for startups instead of relationships. Employees who feel like they’re growing and learning are less likely to want to leave, regardless of financial incentives.
What tips do you have for keeping your employees loyal and happy? (Tell us in the comments below.)