By Benjamin Lee for IQ Dynamics

Plenty has been said about employee engagement and the benefits that it has for an organization. Employees working in a conducive work environment and in a workplace with a great work culture are more likely to be retained and happy. In the long-term, this is crucial if employee turnover rates and job performance are to be managed.

Here are 3 points on why it is crucial to have a positive work culture and how an employee workplace system is crucial in retaining employees.

Happy employees perform better

Employee goodwill is an intangible asset i.e. an asset of a non-physical nature that is often overlooked. Throughout your working life, it is estimated that 80% of your time will be spent in the workplace from completing projects and tasks to simply interacting with colleagues and superiors.

With so much time spent in the workplace, it is important that employees are provided with a safe and comfortable environment to work in. Keeping employees happy at work is a great way to reduce absenteeism, improve efficiency and cut down on turnover as satisfied employees are motivated to perform at a higher level.

On the other extreme, disgruntled and unhappy employees can be disastrous for team morale and employee satisfaction. As reported by Forbes disgruntled employees tend to produce poor quality work, bad-mouth the organization to customers or even engage in theft and destruction of company property while at the same time sowing discord amongst their colleagues and may seem to be the hardest in retaining them. Oftentimes, many organizations tend to underestimate the damage that can be caused by a single, disgruntled employee.

Retaining employees & reducing employee turnover

Retaining quality employees and managing employee turnover are usually at the top of any employer’s mind. Workers choose to leave their organizations for many different reasons, these can range from issues with remuneration to more subjective reasons like job satisfaction or even conflicts in the workplace.

In the past, many organizations have underestimated the importance of having a positive work culture at their own peril and chose to base their hiring processes on technical ability and competency instead lieu of workplace and employee compatibility. On paper, this is a great approach as only the most skilled candidates are recruited ensuring a highly skilled pool of labor, but in reality, this is not exactly the case as factors like an employee’s personality, interpersonal skills, and emotional quotient are not taken into account.

Consequently, a newly hired employee who is not a good fit for the team can have a disruptive effect on the workplace which can upset the team’s dynamic and also result in personality clashes. This further illustrates the importance of having a comprehensive appraisal system that analyzes all aspects of an employee’s performance.

Building your business brand

In an age of information where Glassdoor and Jobstreet allow employees to review their respective organizations anonymously, it has become crucial for an organization to be able to build up its own brand in order to attract talent and retain employees.

One such success story can be seen by how Google is consistently rated by employees as being a desirable workplace. Along with their competitive remuneration rates and unique approach to work, Google has often been praised for being a  proponent of having a healthy, happy work culture and this investment has very clearly paid off handsomely.

As further proof of this; a survey conducted by Kissmetrics showed that Google attracts on average more than 2.5 million job applicants a year, which equates to approximately 6,849 job applications per day. From these staggering numbers, we can clearly see how a positive work culture can pay off in huge dividends for a company and retain employees indefinitely.

Why do we need a performance appraisal system to retain employees?

As has been mentioned many times, HR professionals are recognized as the gatekeepers and protectors of an organization’s work culture. Unfortunately, HR professionals are still human and can still fall victim to discriminatory behavior and other forms of bias. For example, an underperforming employee with excellent people skills and high workplace visibility may receive a higher-than-deserved KPI due to his/her rapport with superiors and members of the HR department.

In the long term, other employees will become disgruntled and unhappy with the perceived unfair appraisal process. As mentioned earlier, these disengaged staff members have the potential to severely damage the organization over time. This situation highlights the importance of utilizing a well-designed performance appraisal system that analyzes various factors and takes into several metrics when determining an employee’s performance.

Recognizing the need for a wholly independent performance appraisal system, we at IQDynamics are proud to offer our comprehensive Human Resource Management solution and Talent Management Software that allows you to measure your employees based on a set of customizable criteria that also helps you identify and develop high performing employees for further development.