The Times: The ‘Rocket Science’ Behind Employee Retention

One of HR’s primary challenges has always been finding and keeping the top talent. And this has particularly magnified following the events of recent years, from the COVID-19 pandemic, to the rising cost of living and employee engagement plummeting on a global scale. According to the CIPD, in 2023 nearly 1 in 6 employees quit their role within their first 12 months. As their needs and priorities continue to evolve in a changed world, talent now seek an exceptional experience from their organisation. So, when looking at workforce attraction and attrition, are the drivers behind this really that complex, or are HR teams undervaluing more simple yet powerful approaches?

The Times recent article explored just this, in which Rippl’s CEO Chris Brown shared some key insights into what’s leading teams to remain with or leave their business.

Ikea’s leading example

In 2022, Bloomberg reported IKEA to have lost 62,000 employees, equating to a 22.4% turnover rate. For an retail employer challenged with a typical ‘revolving door’ business, this fell in line with industry benchmarks. But looking specifically at their UK stores, turnover grew to between 41-60% at its highest point. To solve this, IKEA proactively reassessed their employee experience. And as a result, lowered their UK turnover to 27% in just two years. Let’s explore the 3 ways in which they achieved this.

The science behind employee retention: 3 key steps

1. Compensation. IKEA reviewed their pay and compensation packages and brought this in line with the rising cost of living, for employees living both in- and outside of London.

2. Mentorship. After discovering a vast majority of lost talent were leaving within their first 100 days, IKEA introduced a buddy programme to assign new recruits a more experienced mentor within the business to support with their questions and help to onboard them into their role.

3. Flexibility. Making their ways of working more competitive, IKEA introduced a new flexible working policy which allowed staff to have full control in choosing their schedule for half of their allocated shifts, to best suit them.

What does this tell us?

Compensation matters.

Whether this is delivered through salary boosts or smaller monetary reward, employees need to feel supported and incentivised to go the extra mile and remain within the business. As Chris Brown highlights in The Times’ article, for the many businesses struggling to meet demands for salary increases, enabling managers to distribute ad-hoc rewards creates a feasible alternative which goes a long way. This can be a token amount, but when delivered in a genuine and authentic way, it’s incredibly powerful. Chris highlights an example Rippl has seen in supporting our own customers, where turnover rates can reduce by 20% in employees who receive ad-hoc rewards in comparison to those who don’t. Not only this, an effective reward strategy creates a domino effect across the business to inspire and incentivise others to emulate desired behaviours.

Belonging is key.

Whether successfully onboarding new starters or retaining employees across the wider workforce, employees want to feel connected, seen and heard in their roles, supported by culture that ensures they understand their role expectations and feel they belong. To retain their talent, businesses need to ensure their culture is not only seen but felt at all levels – both mentorship and values-driven recognition are powerful ways to ignite purpose-led behaviours that can then in turn be rewarded.

Wellbeing support is fundamental.

From more flexible working policies to wider employee benefits, comprehensive wellbeing support is key to championing an inclusive workplace. Actively reflecting the diverse needs of employees to support their wellbeing both in- and outside of work is crucial to retain talent. IKEA’s example demonstrates the power of tailored perks that truly reflect individual needs and preferences, and the direct result this has on retention. When teams feel meaningfully supported, they bring their full potential to, and remain within, their role.

Grab a coffee and read the full story in The Times.

Curious to find out more about Rippl’s recognition, rewards and benefits experience?