How small-business mentality can help you retain your top performers

Retaining your best-performing employees should be top in mind, particularly as competitors look to poach those at the top of their game. Here’s how you can ensure you’ve got an effective strategy in place that’ll keep them comfortably in-house.

Building a culture that retains your top performers is key for any HR or business leader.

While the term “continuous performance” can be a bit of an HR buzzword, it aims to address the key components of the employee experience, focusing on progress, feedback and an ongoing conversation about development, according to Culture Amp.

The team’s most recent study showed that employees who are regularly using modules relating to continuous performance are 25 per cent less likely to leave their organisation. These models include, but aren’t limited to, goal setting, one-on-one meetings, regular feedback and performance tracking.

Formal goal setting (both business and personal development) had the biggest effect on employee retention. Those who do not set goals are 26 per cent more likely to leave an organisation than those who do.

The power of feedback

Organisations that prioritise giving considered feedback to their top performers are more likely to retain them long term.

A good way to approach performance reviews and recognition is to operate a “small-business mindset”, according to Culture Amp.

“Within smaller and flatter organisations, employees are more easily able to identify opportunities for on-the-job development,” the team said.

“Company size has a strong influence on the organisational conditions that support performance and development, with smaller organisations leveraging the agility to implement change and experiment.

“Organisations that are more successful when it comes to creating a culture of high performance view creating and sharing enablement materials as essential and take advantage of their smaller size to offer hands-on trainings.”

Regardless of organisation size, however, transparency into how performance is evaluated is a key driver of employee attitudes towards performance management and development processes.

Unlocking high performance

Goal-setting and development plans make employees feel motivated and recognised for their future potential, according to Dr Elora Voyles, lead people scientist at Culture Amp.

This small investment in employee development goals results in large returns in the form of employee promotions and subsequent retention, she said.

“The number one takeaway from this research is that performance goes beyond structured performance feedback, in the form of a continuous process that is interwoven with one-on-one meetings, goal setting, development plans, in-the-moment feedback, and more,” Dr Voyles explained.

“Our research on company size demonstrates that larger companies may be at a disadvantage when it comes to continuous performance. To close the gap, larger companies can benefit from increasing clarity on development opportunities, leveraging manager feedback, and developing an agile communication plan – much like a small business would.”

Michael Yallech, segment vice-president of small to medium business, echoed a similar sentiment, reiterating the lessons that can be learnt from small-business structures.

“In small businesses, every employee’s contribution is critical, and their impact can ultimately make the difference to the company establishing itself or going under. For this reason, performance management becomes that much more important to get right,” he said.

“Continuous performance practices enable any sized team to equitably assess their employees, scan for biases, and store this information in a manner that makes it always accessible. Not only is performance management good for business, [but] when done right, it materially changes the employee experience and the opportunities they’ll be presented with over the course of their careers.

“No business is too small to benefit from an employee-first performance process. Learning faster through feedback and fairly evaluating employees in a fast-growing start-up is a competitive advantage and one we see our SMB customers lean on to drive high-performing teams, which in turn leads to higher profitability.

“Personalisation at scale leads to greater success for everyone.”