7 ways to improve employee loyalty

7 employees standing arm in arm smiling at camera in front of large chalkboard

Employee loyalty can be defined as employees who are devoted to the success of their organization and believe that being an employee of this organization is in their best interest. Not only do they plan to remain with the organization, but they do not actively seek for alternative employment opportunities.

Employee loyalty plays a big role in the success of an organisation and is usually present when the employee feels valued by their manager, like their role matters to the business, and that there is a strong team spirit with their colleagues.

A loyal employee believes their values and goals align with that of the organisation and they work hard to help the company achieve success.  Crucially, they also feel like they aren’t hindering themselves by staying around – whether through a lack of pay rise or career development.

And from a business perspective, employees represent a significant investment.

From recruiting and training costs to salaries and benefits, businesses incur a considerable expense if they need to replace an employee. Therefore, it makes sense to focus on retaining the employees you already have.

An employee retention strategy to improve loyalty through engagement will help you.

Here are some of the ways you can improve employee loyalty and foster an environment that encourages people to stick around.

Approachable management

An employee is never going to be loyal to a boss that makes them feel invisible or under-appreciated.

Management should make efforts to humanise themselves and break down the barriers of hierarchy as much as possible.

This can be simple acts and gestures such as: making friendly eye contact and saying hello at the coffee machine, giving direct feedback in a communicative and collaborative way, and hosting a relaxed weekly team meeting that encourages digressions away from organisational talk, giving everyone a chance to speak freely.

This builds rapport between the manager and team members, as well as between team members themselves.

By becoming more familiar with the personal side to a manager, an employee will feel more comfortable approaching them. These meetings can be great for morale and bring the entire team closer together – which is essential for employee loyalty.

Share business news and performance information

An employee will be more loyal when an organisation is transparent.

If employees have no clue about what’s happening in the organisation, they don’t have much incentive to go above and beyond.

This could be an opportunity to disclose weekly sales figures, expansion plans, or even feel-good personal news about colleagues such as who’s having a baby.

You could do this via company-wide emails, an internal online system for company communications, or even good old fashioned team meetings.

Informal team meetings are great for bringing the team together, allowing a relaxed environment for employees to communicate and build confidence by speaking in front of a group. And by sharing internal news in a setting like this, it fosters an even greater team spirit.

It’s also a good chance for people to share opinions they might not otherwise have offered.

Recognition

We’d all love a promotion and a big pay rise every year – but we know that’s a little unrealistic. For most people, it’s recognition of hard work and a job well done that makes people feel valued.

In 2018, a Harvard Business Review study found that 9 out of 10 employees were willing to sacrifice a percentage of their lifetime earnings for greater meaning at work.

Of course, money makes the world go round, but it isn’t the main driving force behind employee satisfaction and engagement.

So how do you recognise an employee for their performance?

A simple ‘well done’ can go a long way. Perhaps you can give them a ‘shoutout’ in department-wide communications. Maybe you can give them more responsibilities such as mentoring junior team members.

Be flexible

Following the 2020 pandemic, much discussion was around the improved work-life balance due to the shift to remote working.

While not everyone can have the luxury of working from home, there are ways to improve work-life balance for your employees from wherever they work.

Being flexible when it comes to time off is a great way to gain your employee’s respect and appreciation.

10 minutes late? No problem, just work it back later. Want the afternoon off? Sure thing. Need to leave early to avoid a traffic jam? Go for it, just come in earlier tomorrow.

The days of requiring employees to fill in a holiday/vacation form 2 weeks in advance must be firmly behind us if we are trying to improve employee loyalty.

And in a post-pandemic world and where Millennials and Gen Z will make up a large percentage of the workforce, this will only become more important.

Inflationary pay rise

Like we said, money isn’t everything. But the fact is – the value of money goes down every year. Inflation means your salary won’t have the same real-world purchasing power next year.

And an employee who knows this is likely to feel somewhat demoralised at essentially taking a pay cut every year if there is no company support.

Even just improving salaries by a few percent can keep an employee happy and loyal to an organisation.

TIP: Communication is key. If you cannot offer an inflationary pay rise for whatever reason – such as a pandemic affecting earnings – then communicating this to employees is the best way to avoid damaging morale.

Encourage learning and progression

It’s true that some people will be loyal simply because they are comfortable, but for others, they will want to try new things.

Pigeon-holing employees into their role can lead to dissatisfaction and a higher turnover rate.

Organisations and managers that let employees try new things will find they have that employee’s trust and appreciation.

Measure employee engagement

Ultimately, employee loyalty is usually linked to the level of employee engagement. Because when an employee is engaged, they are more likely to stay.

This is because engagement goes far beyond an employee being settled or satisfied.

It means they are invested in the success of the organisation and are fully committed to driving the company forward.

It means they feel valued and part of a team that works hard, has fun, and achieves results together.

It means their personal life can thrive because of where they work.

Therefore it’s important to measure employee engagement to assess how aligned employees are with the goals of the organisation. You can do this with an employee engagement survey.

And by doing this at regular intervals, you can compare and analyse the results over time to understand whether your employee engagement and loyalty strategy is having a positive effect.

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