Why Good Leadership is Essential to Higher Retention

PRemployer on May 2, 2022

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Attracting and retaining high-quality employees is crucial for a small business to succeed, but it's also challenging for many small businesses to achieve. You may be scratching your head, trying to figure out ways to reduce turnover. However, the solution to retaining your best employees is sometimes quite simple. 

How Leadership Improves Retention 

Good leadership is a crucial part of running any small business. Leadership shapes your culture, inspires your employees, improves morale, and fosters the loyalty of your employees. 

Great leaders can create an environment where employees enjoy their work and strive to do better. This atmosphere can encourage employees to stick around, be loyal to your company, and engage in their work.  

Organizations that lack good leadership structures or did not establish an environment that prioritizes positive leading risk high attrition rates. Combating that is simple yet effective. It requires a proactive approach to ensure that your employees get the leadership they need from your managers and supervisors. 

Traits of Leadership 

No two companies are exactly alike. Even competitors in the same industry have differences—differences in their makeup, procedures, staff, culture, and leadership objectives. A great leader must possess no single set of strict traits; instead, influential leaders inspire their employees differently. 

A truly great and effective leader recognizes exceptional talent from a mile away. Whether you're hiring an employee and you spot above-average traits during the interview process, or you have a dedicated employee showing you skills you need in a higher-level position, leaders must spot these individuals and put them into situations where they will thrive. That is not easy and involves hands-on coaching to build their strengths and fully utilize their abilities. 

But you cannot do this without support from the employee. You must communicate with your team through regular check-ins and one-on-one meetings, performance reviews, and informal conversations. Your team needs to feel like you listen to them and hear what they want and need.  

You show your team you hear them by implementing new policies to help them be more effective and efficient workers. You follow through by coaching them and helping them achieve new heights within your organization. Without a hands-on approach to your leadership, you risk making your employees feel isolated and alienated like they don't have direction and don't have a captain steering the ship. That often leads to disengagement and high turnover. 

Tips to Become a Great Leader 

Certain people have natural leadership skills. But people don't have to be born with these traits—employees can learn them during training and throughout their careers. 

If your company hires someone, trains them once, and then never again, you're doing it wrong. Your employees need regular and practical training on their jobs, industry updates, and, specifically for supervisors, leadership training. 

There are also inherent traits that can make someone a truly effective leader. Look for qualities like empathy, integrity, and observation. Many companies think good leaders often talk and boast about their ideas. Great people leaders, those leaders who can have a genuinely positive impact on your culture, are also great listeners. They hear their team, listen to their wants and desires, and then take action.  

When hiring someone or promoting an existing employee into a leadership position, you can train them to be a rockstar supervisor. The best thing to teach them is to advocate for their team. Whether you have just a handful of employees or dozens, you need team leaders who will be assertive, stand by their team, and advocate for their best interests. Without this leadership style and advocacy, your employees will feel left out and like no one has their back, no one is hearing them, and no one is truly listening to them. Employees need to feel like their company cares about them as individuals and wants to help them get the best experience out of their job possible.  

A PEO Guides Business Leaders 

The old adage is absolutely true: people don't quit jobs. They quit managers. Especially in today's work environment, this has never been more true. Employees today are looking for a company that treats them like a person, not just a machine. They want to be a part of something bigger than themselves, coming together with others to achieve a common and lofty goal. 

For many small businesses, this can be an overwhelming task. That's where a Professional Employer Organization (PEO) may be able to help you. A PEO is an HR outsourcing company that partners with small businesses like yours to help you achieve your goals and continue your company's growth. 

They handle all aspects of your business's HR needs, from payroll and tax remittance to benefits administration and leadership training. A PEO can train your managers and supervisors to be exceptional leaders in your organization. You will be able to rely on effective training programs from your PEO to train managers successfully. That way, they can learn the leadership skills and traits necessary to help improve your company's retention, so you reduce the amount of time and money you spend on backfilling roles.  

With the right PEO partnership, your small business can access a comprehensive suite of HR solutions that helps you continue to grow. Find the right PEO for your company today. 


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