The Low Cost of High Retention: 2 Proven Strategies to Reduce Employee Turnover

Why Employee Retention Matters More Than Ever

As a former owner of a Management Recruiters International (MRI) franchise and executive recruiter, I spent seven years conducting hundreds of candidate interviews.

What I discovered was eye-opening: High-performing candidates consistently reached out to recruiters like me shortly after having conversations with their managers that did not go well.

Those poorly executed conversations were costing organizations their best talent, and as a recruiter, I was grateful they happened. But now, working with InsideOut Development, my mission has shifted: helping organizations transform those same conversations into powerful retention tools.

The Hidden Cost of Turnover

Before we dive into solutions, let us acknowledge what is at stake. Employee turnover does not just impact your bottom line through recruitment costs. It affects:

• Team morale and productivity
• Institutional knowledge retention
• Customer relationships and satisfaction
• Organizational culture and stability
• Training and onboarding expenses

The good news? The most effective retention strategies do not require massive budgets or complex programs. They require intentional leadership and a shift in how managers communicate with their teams.

Strategy #1: Repurpose the Conversations You Are Already Having

The Untapped Opportunity in Daily Interactions

When I ask managers and leaders how much time they spend in conversation with their people, responses consistently range from 30% to 80% of their day. Think about that: 30% to 80% of a manager’s time is already dedicated to talking with their team.

This represents a massive opportunity. Your managers are already having these conversations. They do not need new activities or additional tasks. What they need is to repurpose these existing interactions to drive retention, engagement, and culture.

The Million-Dollar Question

Currently, how do your employees feel when they walk away from conversations with their managers? Are they:

• Glad they reached out or were approached?
• Energized and motivated?
• Feeling valued and recognized?
• Ready to return the recruiter’s call — or ignore it entirely?
  
  
  

The Power of Recognition in Every Conversation

Why Recognition Is the Primary Key to Retention

Nothing provides more obvious evidence of being recognized than being spoken to. Every time a leader intentionally communicates with an employee, they are recognizing that person.

Unfortunately, the opposite is equally true: Avoiding communication signals a lack of recognition.

The Data Speaks for Itself

According to research from Gallup and Workhuman (2022), employees at organizations that strategically invest in recognition are:

• 73% less likely to always or very often feel burned out
• 56% less likely to be watching for job opportunities
• 44% more likely to be thriving in their life overall
• 5X as likely to feel connected to company culture
• 4X as likely to be engaged
• 5X as likely to see a path to growth in the organization
• 4X as likely to recommend their organization to friends and family
  
  

7 Types of Recognition Through Conversation

One of the least expensive forms of recognition is helping leaders understand that every conversation is a chance to recognize their people. Here are some simple ways to put this into practice:

These conversation types are “built-in” opportunities your leaders are already having. The key is ensuring they communicate positive recognition in every scenario.

The InsideOut Mindset: The Foundation of Effective Recognition

What Is the InsideOut Mindset?

The InsideOut Mindset is rooted in one powerful belief:

“Every person has the ability to learn and perform at a higher level.”

When asked, most leaders will say they believe this about their people. But here is the critical question: Does that belief get communicated intentionally in every conversation they have?

When Conversations Communicate Belief

When your leaders’ conversations are driven by the InsideOut Mindset — communicating belief, confidence, trust, and assurance — something remarkable happens: employees do not return the recruiter’s call.

This inexpensive strategy of recognition through conversation strengthens organizational culture, reduces turnover, and creates stability at all levels.

Strategy #2: Help Your Leaders Help Their People Avoid Burnout

The Burnout Reality

As an executive recruiter, “burnout” was one of the most common words I heard from candidates seeking new opportunities. When leaders help people avoid burnout, retention naturally increases.

The Capacity Survey: A Revealing Exercise

Over 20 years as a training consultant, I have conducted an informal capacity survey with thousands of managers and leaders. Here is what I consistently discovered:

Question 1: What percent of your employees’ capacity — skills, abilities, and talents — do they bring to bear on average, day in and day out?
Consistent Answer: 50% to 65%

Question 2: Who is responsible for capturing the remaining 35% to 50% of untapped potential?
Response: Leaders inevitably confess this is their opportunity.

Understanding the Capacity Gap: Why Burnout Happens

The Two-Line Model

Imagine two horizontal lines:

• Bottom Line: Represents the current 65% average capacity an employee uses daily
• Top Line: Represents the employee’s 100% maximum capacity

Many leaders hesitate to push people toward that maximum capacity for fear of causing burnout. This concern is valid, but it is based on a flawed assumption.

The Key to Avoiding Burnout

In an ideal scenario, those two lines would never meet. Why? As managers encourage people to access more of their current capacity (raising the bottom line), they must simultaneously provide opportunities to grow the top line, their people’s overall capacity.

This means providing opportunities that:

• Stretch and challenge
• Develop new skills
• Build trust through increased responsibility
• Engage people in meaningful work
• Expand their capability to contribute
  
  

When Growth Prevents Burnout

When people sense they are growing, developing, being trusted, and valued — when their ability to perform at a higher level is assumed by their leader — they do not call the recruiter back.

This is when your organization experiences the low cost of high retention.

Implementation: Making These Strategies Work in Your Organization

Getting Started with Strategy #1: Repurposing Conversations

Getting Started with Strategy #2: Growing Capacity

1. Conduct Your Own Capacity Survey: Assess current utilization and potential

2. Identify Growth Opportunities: Map development paths for team members

3. Balance Push and Pull: Raise expectations while expanding capabilities

4. Monitor for Burnout Signals: Watch for warning signs and adjust accordingly

The ROI of Low-Cost Retention Strategies

When you implement these two strategies, the impact is felt across the organization. Turnover costs decline as spending on recruiting, hiring, and onboarding decreases. Engagement increases as teams become more productive, collaborative, and invested in their work.

Additionally, culture strengthens, creating an environment where people want to stay, grow, and contribute. Performance also improves as employees operate at a higher capacity with less burnout, and the organization gains a competitive advantage by retaining the talent that drives results.

What makes these strategies especially powerful is how little they require financially. There is no need for expensive software platforms, large-scale program rollouts, or additional headcount.

The investment is simply in intentional leadership development and practical communication skills that leaders can apply immediately.

Two Strategies, One Powerful Outcome

High retention does not have to be expensive or complicated. By focusing on two low-cost strategies, organizations can help leaders elevate the conversations they are already having and prevent burnout before it takes hold.

When leaders consistently communicate belief in their people’s potential and create clear paths for growth, something powerful happens: Top performers stop taking recruiters’ calls. They are too busy thriving in an environment that recognizes their value and invests in their development.

That is the low cost of high retention. That is the InsideOut advantage.

For more than 35 years, InsideOut Development has partnered with organizations worldwide to transform leadership and unlock human potential. Our evidence-based approach equips leaders at every level to drive engagement, performance, and retention.

Contact InsideOut Development to learn how your organization can achieve the low cost of high retention.