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Tips on how to make your employees stay

Keep your best employees from jumping ship.
By Noel De Leon |

Each year, close to 3,000 people—a significant percentage of them skilled workers and professionals—leave the Philippines to migrate or work abroad. This is a nagging concern that can hurt the competitiveness of small and medium enterprises (SMEs), considering that they usually don’t have the resources to compete for talented staff and make them stay.

Here are some pointers on how to retain your employees.

1. It’s not really all about the money

There are a lot of studies now that say it’s not money that attracts people to a company. In fact, when I was still working with a multinational human resource company, we did a survey among information technology companies and found out that salaries and compensation are not the No. 1 reason why people stay. Among the major reasons cited were these: allowing employees to dress casually, ‘challenging work,’ and having a defined career path. Salary was the last factor cited by the respondents.

When I became an entrepreneur myself, I learned that people stay with you 30 to 40 percent of the time only because of money. But I found that 60 to 80 percent of the factors are actually other things such as the work environment, the company culture, and fun. If they enjoy working with you, they are not inclined to leave. In other words, ‘people join a company, but they leave a manager.

2. SME’s are more nimble and can react quicker

The problem sometimes is that managers confuse the concept of ‘salary rate’ with ‘salary cost’, but these are actually two different things. The salary rate is what you pay the person; the salary cost is related to productivity.

If you are a small company, you can be more flexible. If the founder of the company is also the president, he can make a decision in a day in contrast to a bigger corporation that can take ages to decide because of the control measures in place.

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Multinationals have high overheads because they maintain high-cost offices; in contrast, an SME can just be based in one’s backyard. The SME can only have a few people, and some of them probably would be relatives of the owner; its president probably would be the son or daughter of the owner. So the SME can compete better because it can act swiftly and it can adjust quickly.

3. Minimize cost through outsourcing

Outsourcing and subcontracting are very hot issues. My advice is this: you must have your core competency. You should have your core group. For instance, if manufacturing is your key competitive advantage, then you should hire manufacturing managers and supervisors.


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