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Employee Relationship Management: What It Is and Why You Need It

Employee Relationship Management: What It Is and Why You Need It

Every company knows how important it is to foster and maintain strong customer relationships. Customer satisfaction is, after all, the very foundation of any successful business. But what about a company’s employees? It’s just as important for managers to foster and maintain strong employee relationships in today’s market, where 1 of every 5 employees is planning to leave their job.

What exactly is Employee Relationship Management?

For most companies, employee relationship management centers mainly on attracting and retaining employees. Its main goals are to enable managers to establish and nurture fruitful, productive relationships with employees and to measure and quantify the results of those relationships in order to determine whether a company’s objectives are being met.

But a recent survey of over 7,500 LinkedIn members in the US, the UK, Australia, India, and Canada revealed that a staggering 85% of today’s workforce “is either actively looking for a job or open to talking to recruiters about relevant opportunities; even the ones who say they are ‘satisfied’ with their jobs”.

The upshot is that most companies are failing to retain their highest-performing employees and the results are financially devastating.

Many studies show that the total cost of losing an employee can range from tens of thousands of dollars to as much as 2X their annual salary. How is that possible? It must be understood that the real “total cost” of losing an employee is comprised of many factors, from the cost of hiring a new person (advertising, interviewing, screening, hiring) to the cost of onboarding a new employee (training, management time), as well as reduced productivity due to the new hire’s learning curve, and the lost value of all the time and money spent training the original employee.

Four key strategies for ensuring great employee-manager relationships

1. Facilitate two-way communication

Sending out an impersonal email or a company-wide newsletter won’t win the hearts and minds (and loyalties) of your employees. People want be able to actually talk to you. Facilitate healthy interaction by fostering an environment in which your people are comfortable asking questions and getting answers. When there’s important information to share, turn to collaboration solutions like internal webinars, video conferencing and web conferencing  to avoid misinformation.

2. Ensure rapid conflict management

Look, adults sometimes disagree. Conflicts between coworkers – and even employees and managers – occasionally arise, creating an atmosphere of stress for everyone around them. Employee relationship management programs that offer team-building exercises and sensitivity or diversity training can dramatically reduce conflict and strengthen relations between employees and their managers.

3. Offer and promote internal mobility programs:

A greater opportunity for career advancement is the leading reason why employees “jump ship”, according to the LinkedIn study. And yet most companies offer rich opportunities for internal advancement. So where’s the disconnect? LinkedIn found that HR professionals vastly overestimated employee awareness of the internal mobility programs offered by their own companies. Internal communication informing all employees about internal advancement opportunities is key to employee retention.

4. Ensure job satisfaction for all, and reward top performers

Following compensation and benefits, the most important criterion for employee satisfaction is a good work/life balance. Savvy managers devote a significant part of their time to resolving matters that cause dissatisfaction in the workplace. Useful tools include focus    groups, employee surveys, and exit interviews. But the implementation of a system of rewards may help managers to avoid exit interviews altogether: think about incentive plans such as profit sharing  and rewards like paid days off or quarterly bonuses to employees who exceed their goals.

If you build it, they will stay

If you spend even half as much time and energy building your employee relationships as you do building customer relationships, you’ll be well-rewarded: your best talent will stay. Employee relations programs that encourage loyalty and reduce employee turnover can also improve the overall quality of the work your company produces. And lower employee turnover translates into an experienced and highly-trained workforce.

According to Chris Musselwhite, author of Dangerous Opportunity: Making Change Work, “The lynchpin to the effectiveness of all these strategies lies in the manager-employee relationship. When this relationship isn’t successful, individual, team and organization performance all will eventually suffer.  When companies refocus on this critical relationship through a renewed emphasis on basic, effective management practices, they can improve individual, team and organizational performance, increase employee satisfaction and strengthen talent management and retention efforts”.

Collaboration and communication solutions play a significant role in developing successful Employee Relationship Programs. Find out more about Arkadin’s award-winning conferencing and collaboration services at

About the author

Suzanne Smith is the Director of Human Resources for Arkadin North America, based in Atlanta, GA. She is responsible for providing strategic leadership and direction of company human resources functions, policies and processes that help drive growth and maximize achievement of short and long-term business goals. As a member of the senior leadership team, Suzanne develops and communicates strategies to support a capable, engaged and energetic employee community. Suzanne has held various HR leadership positions where she has designed and implemented human resource programs that attract, engage and retain key talent and drive business success. Outside of the office, Suzanne enjoys cooking and attending live music, sports and cultural events.

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