According to Webster’s Dictionary, the definition of loyalty is being faithful to a cause, ideal, custom, institution or product. In everyday life, loyalty is found in sports fans that cheer for their teams even when they’re losing or in a dog that never leaves its owner’s side.
Loyalty is important in relationships between friends, family, co-workers, and loved ones. But loyalty is also crucial to the relationship between employees and employers. Loyalty is a key component of employee engagement, which is important to employers because engaged employees drive higher sales and are more likely to stay with their company.
On the other hand, disloyal and disengaged employees will leave their companies for new opportunities, which leaves employers burdened to recruit and train new talent. Additionally, employee turnover is costly for employers. According to Jack Phillips Investing in Your Company’s Human Capital, replacement costs for lost talent are:
- Entry Level: 30% – 50%
- Mid-Level Managers: 125% – 200%
So how do employers create loyal employees? Employers need to understand that loyalty is reciprocal. Employee loyalty is linked to employer loyalty; therefore, employees will not be loyal to a company that is not loyal to them. So what does a loyal employer do? They look out for their employees’ best interest, help to develop their career path, and give them opportunities to grow both personally and professionally.
Here are 3 tips for how employers can win employee loyalty:
- Hire Great Managers. People don’t leave companies, they leave managers. Good managers build solid relationships and connect with employees. When employees have a good relationship with the company or colleagues, there is a social cost for them to leave. Employees value these relationships and are more invested and likely to stay with their company.
- Ask employees how they are doing. Don’t be afraid to open the communication lines with your employees. Conduct employee engagement surveys to get a pulse on the workforce and their needs. This shows employees you are invested in their well-being and are committed to providing the support and tools they need to be successful.
- Provide feedback and recognize accomplishments. Providing specific, meaningful and timely feedback will promote employees personal and professional growth. It also helps employees reach their career advancement goals, which is a huge motivator that both satisfies and retains employees.
What best practices do you recommend for building employee loyalty?