Employee Retention

What is an Organization ?

A set up where individuals come together and work in unison to achieve a common goal is called as organization. Individuals working together in an organization to earn their bread and butter as well as make profits are called employees. Employees are the lifeline of an organization and contribute effectively to its successful running and profit making.

An organization can’t survive if the employees are not serious about it and are more concerned about their personal interests.

What is Employee Retention ?

Employee retention refers to the various policies and practices which let the employees stick to an organization for a longer period of time. Every organization invests time and money to groom a new joinee, make him a corporate ready material and bring him at par with the existing employees. The organization is completely at loss when the employees leave their job once they are fully trained. Employee retention takes into account the various measures taken so that an individual stays in an organization for the maximum period of time.

Why do Employees Leave ?

Research says that most of the employees leave an organization out of frustration and constant friction with their superiors or other team members. In some cases low salary, lack of growth prospects and motivation compel an employee to look for a change. The management must try its level best to retain those employees who are really important for the system and are known to be effective contributors.

It is the responsibility of the line managers as well as the management to ensure that the employees are satisfied with their roles and responsibilities and the job is offering them a new challenge and learning every day.

Let us understand the concept of employee retention with the help of an example:

Misha was a talented employee who delivered her best and completed all her work within the desired time frame. Her work lacked errors and was always found to be innovative and thought provoking. She never interfered in anybody else’s work and stayed away from unnecessary gossips and rumours. She avoided loitering around at the workplace, was serious about her work and no doubts her performance was always appreciable. Greg, her immediate boss never really liked Misha and considered her as his biggest threat at the workplace. He left no stone unturned to insult and demotivate Misha. Soon, Misha got fed up with Greg and decided to move on.

Situation 1 - The HR did not make any efforts to retain Misha and accepted her resignation.

Situation 2 - The HR immediately intervened and discussed the several issues which prompted Misha to think for a change. They tried their level best to convince Misha and even appointed a new boss to make the things better for her.

Situation 1 would most likely leave the organization in the lurch. It is not easy to find an employee who gels well with the system and understands the work. Hiring an employee, training him and making him fit to work in an organization incur huge costs and thus sincere efforts must be made to retain the employee. Every problem has a solution and the management must probe into the exact reasons of an employee’s displeasure. Employees sticking to an organization for a longer time tend to know the organization better and develop a feeling of attachment towards it. The employees who stay for a longer duration are familiar with the company policies, guidelines as well as rules and regulations and thus can contribute more effectively than individuals who come and go.

Employee retention techniques go a long way in motivating the employees for them to enjoy their work and avoid changing jobs frequently.


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The article is Written By “Prachi Juneja” and Reviewed By Management Study Guide Content Team. MSG Content Team comprises experienced Faculty Member, Professionals and Subject Matter Experts. We are a ISO 2001:2015 Certified Education Provider. To Know more, click on About Us. The use of this material is free for learning and education purpose. Please reference authorship of content used, including link(s) to ManagementStudyGuide.com and the content page url.