Colorado small businesses are less likely to change health insurers for the upcoming year, even as they anticipate continued price increases, according to the second-annual Delta Dental of Colorado Small Business Survey.
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Here’s the scenario that I see emerging in multiple companies: One valuable and respected employee is frustrated by the way she’s been treated by her employer over the last few years – reduced hours, lost pay, no advancement, and some personal conflicts with her boss. She finally works up the courage to look outside for other jobs.
Because she has valuable skills, she manages to get a great job with the competitor across town. This sends shock waves through her previous co-workers, because they now realize that it’s quite possible, and beneficial, to start looking for jobs elsewhere.
Those who get jobs first, of course, are the employees who are the most valuable. They have the best skills, experience and soft skills. The holes that open up are significant, and the company will pursue one of three avenues for recovering.
First, these may become opportunities for promotion. That may be quite attractive for some who want to advance, depending on how the process is handled.
Second, the company could take this opportunity to continue to eliminate jobs and save money. The remaining employees will interpret this as a strong signal that advancement is only an illusion, and the company is falling behind the competition.
Third, the company might replace key positions by hiring from the competition. This will encourage circles of job-hoppers in the industry, encouraging employees to look for external opportunities rather than staying with their current employers.
As the boss, why should you care? After all, a certain amount of turnover is good: It helps to bring in new ideas and approaches, and gives opportunities to restructure the workforce with new skills.
Imagine, though, that you end up losing 80 percent of your capability (remember, your strongest employees will leave first) in a short time. What happens to your key processes? Do you still have your base of knowledge? What happens to your customer relationships?
Even if you hire high-quality replacements away from your competition, each departure will cause significant damage.
So what can you do to encourage your employees to stay? Multiple studies have shown, surprisingly, that money is not the top of the list. Employees need to make enough income to survive, of course, but beyond that, other factors start to take over.
Why we work
What are you doing in your company to:
These are the reasons why your employees will stay with you as their opportunities increase to move to your competition.
Carl Dierschow is a Small Fish Business Coach based in Fort Collins. His website is www.smallfish.us.