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Reducing employee turnover through psychological safety: A guide for companies

Have you ever calculated how much it costs you to replace an employee? High employee turnover is associated with risks and high costs for companies. A high turnover of employees can not only affect productivity and continuity, but also cause high costs and put a strain on the working atmosphere. The peace and quiet for productive work is gone.

Studies by Culture Amp and HRforecast show that the cost to companies of replacing an employee is between half and double (200 percent!!!) their salary. The cost of recruiting and the impact on productivity and the entire team should not be underestimated. Often you cannot find suitable employees today and the position remains vacant for so long. An effective strategy for managing employee turnover is to promote psychological safety in the workplace.

In this blog article, I will show you how you can counter employee turnover through psychological safety. In the conclusion, you can read how you can support your company in identifying relevant factors for psychological safety and thus actively influence employee turnover.

What is psychological safety anyway?

Amy Edmondson (considered the pioneer of psychological safety research) defines psychological safety as all members of your team in the company feeling able to take risks, speak up and act proactively. William Kahn (considered the father of employee engagement) describes it as the feeling of being able to show and use one’s self without fear of negative consequences.

In short: Psychological safety describes the feeling of employees that they feel safe enough in their working environment to express their own opinions and ideas without fear of negative consequences. This requires a culture of openness and trust.

Promoting open communication has a positive impact on psychological safety and thus contributes to reducing employee turnover.

Once again, managers in particular are called upon to make the greatest contribution to ensuring that communication channels in the company are open and that employees share their ideas openly without fear of negative consequences. Through open communication, problems can be identified and solved at an early stage.  However, open communication channels are not only important for 1:1 communication, but also apply to cross-project collaboration between all team members. Keeping an eye on the entire communication culture is a real challenge for managers.

Open communication is particularly challenging when companies are operating in a difficult economic environment or when internal company changes are planned or imminent. This is when uncertainty takes hold, as changes can put open communication under pressure and often also fuel staff turnover. You know that unrest is bad for business. However, this is when it is particularly important to pick up all employees and prove that you take open communication seriously. Undiscovered frustration or dissatisfaction can quickly arise in difficult economic times and for some employees, the flight forward – towards resignation – is a way of avoiding difficulties. This drives up staff turnover, and it’s probably the people you want to keep who leave.

Creating clarity reduces employee turnover and creates security

Time and again, we read that it is important for employees today to clearly recognize the purpose of their own work and to be aware of their own contribution to the overall company goal. Managers are therefore strongly encouraged to focus on the company’s goals in their daily communication and to emphasize the contributions of employees to achieving the company’s goals.

In this way, you ensure that the company’s goals are clearly communicated and that employees understand how their own work contributes to achieving these goals. This creates trust and clarity regarding your expectations and the sub-goals to be achieved for the employees.

You can reduce uncertainty, ambiguity and confusion by communicating frequently – even through different communication channels, from 1:1 feedback meetings to Q&A sessions in larger team meetings. This is the only way to ensure that the information is received correctly by employees and creates security.

A strong corporate culture against employee turnover

A positive corporate culture in which everyone feels seen and valued also contributes to increased psychological security in the company and reduces employee turnover. Employees who you treat with empathy, whose strengths you promote and whose work is seen are more likely to feel connected to their own company and encouraged to give their personal best.

Conclusion:

Psychological safety in the workplace can help to strengthen employee loyalty and reduce staff turnover. By encouraging open communication, support and empathy, clear expectations and goals, and a positive company culture, managers can create an environment where employees feel safe, supported and valued. Companies that invest in psychological safety can reap the long-term benefits of higher employee retention, lower turnover and an overall positive work environment.

Why is it important to discuss psychological safety in the context of employee turnover?

At Better linked, we are very much concerned with the underlying reasons and causes of stressors and the effects of stress on the entire company. The perception of stress is individual, but how it is experienced externally – at the behavioral level – and the impact stress has on the entire corporate culture is often reflected in the underlying perception of psychological safety.

Whether psychological safety is perceived by employees or whether it is actually practiced in a credible manner is usually not openly apparent. This requires continuous work and daily “proof”. An experience to the contrary that is not recognized in time can quickly destroy the long-term development work.

Allow yourself to be supported in the continuous development and experience of psychological safety by providing your employees with a supportive community alongside their personal and active commitment. This is where employees can communicate quickly if they perceive developments that they believe are not conducive to the company’s objectives or are detrimental to the corporate culture.

Creating a supportive working environment and sharing personal experiences can also help to strengthen the perception of an appreciative working environment. This enables you to always offer employees a sympathetic ear, quickly recognize what is needed, strengthen psychological security in your own company and be able to react to changes.

You ensure greater calm in the company and employee turnover is significantly reduced.

  • employee health
  • employee turnover
  • psychological safety
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