Why you’re probably getting employee retention all wrong

Let’s be honest, retention is in crisis mode right now. 

Companies are struggling to hold onto their best people, and yet, most leaders are still relying on surface level perks and gut instinct to tackle the problem. If you’re throwing raises and sweeteners at employees hoping they’ll stay, you might be missing the bigger picture.

Here’s the thing: motivation is a science, not a guessing game. And we’re serious about solving the retention puzzle, we need to understand it from a deeper, more strategic perspective. 

That’s where Frederick Herzberg’s Two-Factor Theory comes in: when it comes to understanding what truly drives people at work, there’s arguably no better theory.

Breaking down Herzberg’s Two-Factor Theory

Herzberg discovered that job satisfaction and dissatisfaction aren’t just opposite ends of the same spectrum. Instead, they’re influenced by two separate sets of factors:

Hygiene Factors: the basics that keep people from leaving 

Think of hygiene factors as the foundation of a house. If they’re not there, everything falls apart, but having them doesn’t automatically make people happy.

• Fair pay
• Job security
• Good working conditions
• Clear communication

When these things are missing, dissatisfaction creeps in fast. But here’s the kicker: getting them right doesn’t mean people will be motivated to perform at their best.

Motivators: the secret sauce for engagement 

If hygiene factors are the foundation, motivators are the interior design – the things that make people excited to stay and thrive.

• Recognition for their hard work
• Work that feels meaningful
• Opportunities for growth
• Autonomy to make decisions

These elements genuinely drive satisfaction and long-term commitment.

The biggest mistake companies make is focusing too much on hygiene factors and neglecting the motivators. If you’re only offering competitive salaries and benefits, but ignoring growth and recognition, you’re not addressing the bits that really matter.

Retention isn’t an HR buzzword – it’s a strategy

Recent data backs this up. Studies show that 47% of employees are considering leaving their jobs due to a lack of career growth and recognition. On the flip side, companies that invest in strong internal communication and culture see up to 50% lower turnover rates.

This is where smart digital platforms, like Haiilo, come into play.

How to actually make Herzberg’s Theory work for you

Here’s how you can tackle both hygiene factors and motivators using modern tools like Haiilo:

Fixing the Hygiene Factors:

• Clear Communication: Nobody likes being in the dark. Haiilo helps by delivering company updates, strategies, and expectations straight to employees in a way that’s easy to digest.
• Easy Access to Info: No more frustration over lost emails. Haiilo gives employees a one-stop-shop for everything they need.
• Building a Feedback Culture: Employees want to feel heard. With Haiilo’s feedback tools, they can share their thoughts, and you can take action.

Boosting the Motivators:

• Recognition Made Easy: A simple ‘thank you’ goes a long way. Haiilo lets you celebrate achievements with social feeds, comments, and shoutouts.
• Empowering Personal Growth: Whether it’s training materials or mentorship opportunities, Haiilo makes career development more accessible.
• Creating Purposeful Engagement: Employees want to feel like they’re part of something bigger. Interactive features and collaborative tools foster a true sense of belonging.

Other theories are available…

While Herzberg’s Two-Factor Theory is compelling, there are alternative or complementary models that can help crack the retention puzzle:

1. Self-Determination Theory (Deci & Ryan) suggest that people are most motivated when they have autonomy, competence, and a sense of connection. If they feel in control, capable, and valued, they’re likely to stick around.
2. Job Characteristics Model (Hackman & Oldham) says that work design matters. People are more engaged when their roles have variety, significance, autonomy, and clear feedback loops. If a job feels repetitive and meaningless, forget it!
3. Equity Theory (Adams) is all about fairness. People compare their input (effort, skills) to their output (pay, recognition) and to others around them. If they feel shortchanged, they’ll inevitably look elsewhere.

The smartest people in the room mix and match to build a workplace where people actually want to stay, not just because they have to, but because they want to.

Beyond “vibes”: rethinking retention

The truth is, most companies are slaves to an old school mindset when it comes to all things retention. Just ask Twitter (sorry, X) how well the “hardcore hustle” approach is working out. Spoiler: not great.

They focus too much on those easy-to-measure pieces – like salary and perks – and forget that people crave meaning, growth, and recognition. Ironically, it’s something we intuitively understand, but routinely neglect in the strange world of work.

Old habits die hard, but die they must. 

By combining principles of Herzberg’s Two-Factor Theory with modern digital solutions, we build workplaces where people actually want to stay; not just for the paycheque, but for the fulfilment. 

Surely that’s a more fulfilling way to go about retention…