There are many ways to increase employee retention.
Encouraging employees to maintain a work-life balance plays a big role in this pursuit, not forgetting a positive work environment that champions this.
A culture of recognition is equally important in ensuring that employees feel valued in the workplace.
While these are often spoken about, many organisations overlook another critical strategy of employee retention: stay interviews.
Unlike exit interviews that understand the employees’ reasons for leaving, stay interviews study the opposite: why do they remain with the organisation?
What does a stay interview mean?
A stay interview is defined as a one-on-one structured, focused, but open discussion between a leader and employee. Another term for stay interviews is retention interviews.
Here, a leader is anyone who manages one or a group of employees, interchangeable with “managers” or “supervisors”.
Stay interviews are conducted with the mindset that every hire is a valuable employee. It is, therefore, important to consistently hear from them, understand their needs and preferences, and address them.
The nature of the conversation is to understand what more organisations can do to strengthen employee engagement and retention, and build mutual trust.
This definition was coined by Richard P. Finnegan, CEO of C-Suite Analytics, who writes extensively about this in his books, “The Stay Interview” and “The Power Of Stay Interviews For Engagement And Retention”.
A few points are worth highlighting:
- Who should do a stay interview? It is the leader who conducts the interview. This leader is often the direct manager of the employee.
- What do you talk about in a stay interview? The discussion centres on an employee’s job experience. It is not a performance review.
- Who are stay interviews for? The stay interview is for all employees, not just the top performers.
- How do you conduct a stay interview? The interview should take place face-to-face or, given changing work arrangements, via video conferencing.
What is the difference between a stay interview and an exit interview?
Stay interviews are conducted with current employees. In contrast, exit interviews are held with employees who have submitted their resignation letters and are serving their notice.
The goal of these interviews is the same: to gain honest feedback on what more your organisation can do to help employees and encourage them to stay. In other words, you ask interview questions to understand job satisfaction levels and employee morale.
However, the way these interviews are structured and conducted will be different.
In a stay interview, for instance, your managers ask your employees about their motivations and goals, as well as the challenges they’re currently facing. It will be a meaningful discussion to improve their employees’ personal experience on the job.
Exit interviews, on the other hand, are conducted by your human resources team. Their goal is to understand the reason behind the resignation and find gaps to fill in the employee experience to improve retention.
Is a stay interview a good thing?
Yes, stay interviews are good for any company. Finnegan offers a tried-and-tested solution — stay interviews have allowed his clients to reduce turnover by over 30%. This means stay interviews can have a significant impact on employee retention rates.
The cost of turnover is high, which many leaders are well aware of. “When they lose an employee, it takes up to 6-9 months of salary to replace them,” says New York-based talent specialist Mila Singh, who is now the Director of Talent Operations at youth development organisation Dream.
Stay interviews that cover the gaps between employee satisfaction and work experience are thus crucial for organisations that cannot afford to lose good talent. It’s also the first step to recognise disengaged employees, so measures can be taken to prevent them from moving on.
At Whirlpool, the pilot implementation of a retention risk assessment toolkit revealed that managers could not answer a series of questions about their relationships with their employees. Following that, a template for stay interviews was provided to foster a two-way dialogue between the two parties.
The approach improved interaction levels between employees and managers who took part in the programme. It also reduced the attrition rates of females and underrepresented minorities by at least half.
The results prove that conversations between employees and leaders are imperative to an organisation’s retention strategy — stay interviews enable such interactions to take place and make an impact.
How often should stay interviews be conducted?
As a rule of thumb, stay interviews should be conducted periodically. Organisations can choose to do so annually or twice a year.
It is also helpful to conduct interviews with new hires within three months of their joining date to assess their experience with the organisation and what more the leaders can do to engage them.
What questions are asked in a stay interview?
Finnegan offers a good guide to the interview process leaders can leverage. These cover five core questions:
- What do you look forward to when travelling to work each day?
- What are you learning on the job?
- Why do you choose to stay here?
- When was the last time you contemplated leaving the company?
- What can I do to make your job experience better for you?
These questions can be further branched out to explore employees’ positive experiences, challenges and day-to-day concerns.
For more guidance, you can consider the following themes as a way to prompt your employees with thoughtful follow-up questions:
- Training opportunities: Are there sufficient employee development for your career growth?
- Career goals: Are you able to meet your goals within our work environment?
- Lines of communication: How convenient is it to communicate with your managers and peers?
- Economic uncertainty: What can I do to assure you that you will stay relevant in the job market and the company?
How can I plan for stay interviews?
Before rolling out a plan for effective stay interviews, take note of these useful tips:
- Analyse the current situation (i.e. retention rate, employees’ reasons for leaving etc.) and how it is affecting the organisation
- Set the goal you intend to achieve for your organisation in terms of its retention rate and level of engagement
- Inform managers of the above, alongside the importance and benefits of stay interviews
- Map out a process for managers to conduct the interviews, which can include:
- Series of questions to ask
- Length of each interview session
- Guide and train managers in conducting the interviews, which can include:
- Advising them on ways to ask follow-up questions
- Managing negative feedback
- Adjusting tonality and body language during the interviews
Stay interviews will bring you closer to your employees and leave a positive impact on the work culture as a whole. Start exploring today and witness their benefits in the months that follow.