The Innovative Workplace
Use client retention techniques to reward and retain your good employees
You understand the importance of client retention. You invest heavily in your service operations and provide other value-added tools and services to keep your clients. Key accounts get white-glove service, and you typically put your best and brightest employees on those accounts. Your clients love these employees, and you wouldn’t want to tell them one day that one of those exceptional employees left for another opportunity.
All the economic signs, coupled with survey data, show that talent scarcity in America is real. Statistics show that the job market continues to expand. According to the Bureau of Labor Statistics (BLS) report released in March, job openings increased the most in professional and business services categories in January 2017, with voluntary quits up in the finance and insurance category. On top of those government statistics, just about every survey published by employer groups and business publications touts continued job growth and talent shortages this year.
What does this mean for employers?
In addition to the employment statistics, the State of the American Workplace report released by Gallup in February reported that the speed with which American business is changing is forcing employers to reconsider how they manage their employees at a time when the foundation of how, when, and where people work is shifting. Further, the report states that the value employees place on work is changing, with 51% of the employees surveyed actively searching for new jobs or watching for job openings.
What does this mean for you? It means that now is the time to be vigilant and give your valued employees compelling reasons to stay at your agency. Your employees have expectations about their jobs and want to do work that is meaningful and utilizes their individual talents. They want to continue to learn and advance their skills for their next position (ideally within the agency) and expect their jobs to be structured to fit their lives.
The Gallup poll reported that, in the statistical sample polled, only:
20% say they are managed in a way that motivates them to do their best work.
Action item: Make sure your management team is trained to develop stretch goals and provides employees the tools and incentives to reach those goals.
91% say that the last time they changed jobs they had to leave the company to do so.
Action item: Create career paths so employees can see themselves growing their careers with your agency, and ensure that your managers are having career coaching discussions with their employees.
22% of employees agreed that leadership in their organization had a clear direction for the company.
Action item: Be sure that your agency’s strategic goals are clear and discussed with your staff. Tie their performance objectives to your agency goals.
13% believed that their leadership communicated effectively within the organization.
Action item: Be visible—get out of your office and walk around. Answer employee questions. Keep employees informed about what is going on in the agency. Pay attention to employees, and don’t take good work performance or behavior for granted. Express appreciation for jobs well done. Listen to employees’ ideas and
Loyal employees make a difference
As with your best clients, your employees are your customers too—make no mistake about it. With the explosion of ways to connect and be connected, your employees are out there actively expanding employment networks in pursuit of new opportunities. Client meetings, industry conferences, and postings on social media sites are all ways for employees to showcase their talents to prospective employers and build their own personal brands.
Now is the time to be vigilant and give your valued employees compelling reasons
to stay at your agency.
So what are you doing to keep your best and brightest? Budgets are tight, and many agencies are focusing energies and resources on clients, because of the competitive pressures facing the insurance industry today. Uncertainty is high about healthcare reform changes and overall compliance expectations. While our energies are focused outward on clients and potential industry changes, our key employees are giving us their best every day and working hard to keep clients loyal to us. We owe it to them to treat them with the same care and concern we give our clients.
The costs to replace an employee are high, particularly when you consider the value of time lost from your regular duties to conduct interviews to find replacements and onboard new employees. Estimates range between 30% and 50% of annual salary to replace an entry-level employee, with costs up to 150% of annual salary for mid-level employees and up to 400% for high-level and highly specialized employees. You can do the math for the hard-dollar costs.
Consider that employee turnover also disrupts the agency in many ways, as others must juggle workloads to make up the slack. In addition, employee turnover disrupts service to clients. So instead of spending that kind of time, energy, and money once a valued employee walks out the door, spend your resources on doing the right things to hang on to them. In the long run, it’s well worth the investment.
Treat your employees as you treat clients
Employee engagement is just good business. According to Demand Metric, organizations that have over 50% employee engagement retain over 80% of their customers. Consider using the following client strategies with your employees:
- Segment your employees as you do your clients. For key accounts, you prepare customized insurance packages and products, put your best employees on the account, keep in constant communication, and offer more training and support, while customizing your approach so that these clients feel special. In the same way, consider each employee’s value to the agency.
- Check in regularly with your key employees. Measure the pulse of what employees in the agency are thinking and feeling about their supervisors, team, agency culture, opportunities for advancement, pay and benefits, training and development, and other factors that are important in your agency or the industry. The key is to follow up on those surveys with focused communications, training, and actions. As this relates to individual high-potential and high-performing employees the goal is to customize the work experience to provide those employees everything they need from your agency so they don’t feel the need to take that headhunter call or surf the job boards to see what might be interesting and who is hiring.
- Use some of the same techniques to avoid client churn with employee turnover. Most agencies focus on client churn and strategies to mitigate “avoidable churn.” There will always be instances of unavoidable churn, where clients go out of business or go bankrupt. You really can’t do anything about that except to wish them well with their next venture. But in the instances where there is the possibility of saving the account and preventing the cancellation, agencies may assemble “save teams” to remind the client of the value the agency has provided. Deploy the same approach with your valued employees who are talking about leaving.
- Make sure your employer brand is as strong as your agency brand. It’s a simple fact: All employees, and especially the high-performing ones, want to work for a company they perceive as a winner. Winners want to affiliate with other winners. Create a strong corporate culture that reinforces for your employees that they are working for the right employer at the right time, in the same way that your marketing team focuses on reminding your clients why they signed with you and the value they get from partnering with your agency.
You have the tools you need to keep your best employees
Make sure that you are using all of your weapons in the talent war to retain your valuable employees, and remember that you are uniquely positioned to win by applying the same client retention tactics you use every day to keep your employees. Now is the time, so develop a sense of urgency about this if you haven’t already. Pay attention, look for signs of disengagement, and act fast to turn it around. It’s good for your employer brand and good for your overall business.
Laura Kerekes is ThinkHR’s chief knowledge officer and leads the ThinkHR content knowledge and human resources service delivery teams. In addition to her company responsibilities, she writes management, human resources and business articles and presents regularly to management groups regarding human resources best practices. She holds both the HRCI Senior Professional in Human Resources (SPHR) and SHRM-SCP professional designations.
About ThinkHR: ThinkHR partners with over 650 leading insurance brokers and payroll bureaus with an HR knowledge platform that enables their clients to obtain quick answers to urgent risk and liability questions, protecting clients from loss and legal action; stay informed on the correct responses and decisions for HR management and compliance matters; create web training programs to educate and develop employees in the areas of safety, management and wellness; and save time and money versus expensive alternate legal and HR resources.