IKEA Reveals How it Tackled Its High Staff Turnover Crisis

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IKEA Reveals How it Tackled its High Staff Turnover Crisis
Photo Credits - Jueun Song via Unsplash

In 2022, around 62,000 employees left IKEA every year—more than one-third of its global staff. This was costing the Swedish furniture company approximately £3,910 per departure. Below, we discuss what IKEA did to improve staff retention and halt its high staff turnover.

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How Did IKEA Solve its Staff Turnover Issue?

It was a dire situation for IKEA – continuously recruiting and training new employees, only to lose more in droves. Its staff turnover was remarkably high, it struggled to find and recruit talented personnel, and feedback from managers was rare. It needed to create and implement fresh employee retention strategies – and it needed to do it quickly.

The company focused on three principal areas to boost staff retention. First, it increased its employees’ pay, with London-based staff receiving a rise of £2.15 per hour. Second, it implemented technology to help its employees in their roles. Third, it increased the flexibility provided to its store-based employees.

IKEA Solves Staff Turnover Crisis with Three-Pronged Approach
In a bid to prevent further staff turnover, the globally renowned furniture company increased employee pay, implemented technology and improved its flexible working policies.

And IKEA’s three-strand approach certainly appears to be working. Over the past year, staff turnover reduced from one-third to one-quarter, and in less than six months, the rate of employee departures decreased from 22.4% to 17.5%. As such, other employers will likely follow IKEA’s example in employee retention strategies.

Read: After The Great Resignation Comes “The Big Stay”: How to Retain Employees in 2024

Director of XM Strategy at Qualtrics, Sally Winston, has highlighted the link between employee and customer satisfaction. She explains that the two are inextricable from one another, stating, “The guiding principle is the same for both sets of experiences – customers and employees need to be viewed as people, with goals, ethics and emotions, instead of being seen as the roles they play in the business setting.”

Implementing Technology Boosts Employee Wellbeing

Technology can be used in a vast range of ways at work, with each type having its distinct advantages. Examples include increasing employees’ productivity, facilitating remote working, and promoting staff well-being, all of which can help stabilise staff turnover. Given the technology available today, businesses must ascertain the most suitable type before altering their practices to align with them.

For example, there is software that effectively transforms time-consuming, monotonous tasks into quick, automated ones, impacting workflow in areas such as project management, marketing, sales, and operations. This boosts the motivation of employees, who can then focus on core tasks, increasing their productivity in the process.

Read: Flexible Working: Making Requests from Day One

Other types of technology relate to communication, both internally and with customers. Such tools enable seamless coordination and assist with creating, assigning, and managing tasks, improving collaboration across teams and locations. There are also customer-facing technologies that interact directly with customers, clients, and even employees to deal with queries and solve problems quickly and efficiently. Data storage, employee development, and creative solutions are further examples of how technologies might benefit a business.

Regarding well-being, technologies are available to track employees’ physical wellness, including exercise, sleep, and nutrition. Mental health may also be enhanced by using applications relating to stress management and mindfulness and the improved accessibility of mental wellness resources and online support.

Remote working, which in turn is believed to boost productivity and improve employees’ well-being by enabling a better work life balance, is supported by such technologies as Microsoft Teams, Zoom, and Slack. These promote easy communication with colleagues and clients without needing a physical presence in the workplace.

Flexible Working Reduces Stress and Improves Staff Retention

Flexible working has multiple potential facets, including altering the times, hours, and/or location of work. It’s become increasingly prevalent in recent years, and its popularity has grown as employees discover the associated benefits.

Many employees feel that flexible working achieves a better work life balance, increases autonomy and productivity, and reduces stress. In addition to improved employee productivity, benefits for employers can include attracting talent, improved staff retention, decreased overheads, and lower staff turnover. Given this two-fold positivity, it is unsurprising that many employers use various forms of flexible working in employee retention strategies.

There are certain techniques which employers might consider implementing to assist with flexible working. The first step is to ascertain the correct combination of methods that best fit a specific business, then implement these incrementally to ensure they work effectively. Some examples of flexible working practices include telecommuting (e.g. online meetings, video calls, and webinars), compressed working weeks (i.e. more hours over fewer days), altered work hours (i.e. alternatives to the standard 9 to 5 model), and introducing different types/extent of leave (e.g. caregiving leave and/or unlimited days of leave). It is also essential for employers to manage any individual flexible work requests correctly.

Employers may wish to consider consulting with their employees regarding the types of flexible working techniques that are most desirable and will achieve the best work life balance. Involving employees in the selection and implementation process will likely make them feel more valued and allow employers to clarify expectations and business concerns. Encouraging employees to provide feedback on what is and is not working and consistently monitoring and updating practices will help to achieve a successful, flexible working system.

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