Wednesday, October 5, 2011

The State Of Worker Loyalty: Building A Loyal Small Business Workforce

Successful small businesses use strategies to attract, satisfy and build a loyal, high-performing customer base. These same strategies can be used to attract, satisfy and build a loyal, high-performing workforce. Working in tandem, these two dynamics will produce strong business performance.

These five strategies will help you build a loyal workforce.

1. Make sure compensation plans are competitive.

Companies that overcharge, or charge above the value of market prices, will find their customers drifting to more competitive companies with better pricing.

In the same vein, small businesses that pay below-market salaries or give the perception of paying below-market salaries risk losing their workers to companies that pay more or give the perception of paying more for the same work value.

Monster research indicates that salary is the number one factor that employees consider as they evaluate new job opportunities. Therefore, small business must align their compensation plans to be competitive in their market and remove any employee or potential employee perception that a misalignment exists.

2. Target the right hire

Businesses know they cannot serve all consumers. So businesses pick a "target market" of consumers they will seek to serve by building a product or service that best meets their needs. Similarly, a company's size and culture will not be attractive to the entire workforce. A company must find the workers that prefer and are best able to perform within the company size and culture.

Attract and retain workers that will appreciate and value your small business company culture. Monster research shows that about one-third of the workforce prefers working in a small business culture.

Top reasons those workers give for valuing a small business work environment include:

  1. Being part of a "family"
  2. Feeling more valuable as a worker
  3. Being treated as an individual
  4. Making a bigger impact
  5. Getting opportunities to learn by doing a variety of roles

Similar to creating customer loyalty, small businesses can promote these workplace values to attract new workers and build employee loyalty.

3. Communicate a strong and attractive employer brand

Consumer product companies actively promote the value of their brands to attract new customers and reinforce these values to their current customers.

In the same way, a small business must build and promote an employee brand that readily communicates its values to attract the right workers. Reinforcing such values to current employees helps build employee loyalty as well.

Monster research indicates that 68 percent of the workforce would consider a new job to obtain improved work culture and leadership. By growing an awareness of your employee brand as one that embraces the values these workers are seeking (see No. 2 above, "Target the right hire"), a small business will attract and keep the right workers who favor similar values.

4. Continually fill a pipeline of prospects

As customers' needs and desires change, businesses know that they lose some customers through natural attrition. Building a pipeline of prospects is important to replace those customers that inevitably leave.

With a vast majority of the workforce ready to pursue a new job, it is probable that small businesses will lose workers as the economy expands and new job opportunities grow. Small businesses need to create a talent pipeline that continuously attracts new talent and the right talent for its workforce. (Note: if you successfully implement No. 1, 2 and 3 above, you will minimize your workforce attrition.)

5. Strive to keep your "A" workers

A leading business knows that all customers are not equal, with some customers delivering a higher level of value (the 80/20 rule, also known as Pareto's Principle). Determining who these best customers are and focusing on their loyalty will ultimately deliver the best business performance.

As a small business you are dependent on the key workers who deliver your business performance. These are your "A" players. These are the workers whose loyalty is most valuable and perhaps, critical, to your small business.

Consider your workforce and identify those workers who are delivering the majority of business value. Next, ensure that your employee loyalty strategies—those strategies you design to emotionally engage a worker—are focused on your "A" team.

With these five strategies, you should be able to build a talented and enduring workforce that will enable your business to succeed.

Findings are based on research developed in the Monster Employee Loyalty Survey, conducted in March, 2011.

Thanks to Jeff Quinn / Open Forum / American Express Company

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