High SaaS Employee Turnover? It’s You, Not Them.

I know it sounds harsh, but when you have a SaaS company with high turnover, it’s much more likely to be the company’s fault than the employees’. Sorry, but millennial tales of woe notwithstanding, people stay where they love to be. SaaS employee turnover is far more costly — in hard expense and lost growth momentum — than retaining great people.

Employee Turnover Flipover

When I was CEO of ion interactive, we had a cash-motivated, extremely talented individual who threatened once, and then finally did leave us for a bounty. That was a very rare instance for us and one that was concerning at the time. But, low and behold, a few months into his new gig the grass was a bit browner than expected. And the cash wasn’t green enough to make up that ground. He came back because he loved coming to work at ion and dreaded going to work at evil-empire-HQ.

Reducing Employee Turnover through Differentiation

The competition for SaaS talent is beyond fierce. Almost regardless of how deep your pockets are, you can still be outbid. Someone will always offer more — too much, in fact. So if it’s all about price, it’s a race to the top (or bottom, depending on who you ask), and that’s a real challenge. Differentiation, beyond salary and even beyond hard benefits, is not optional. As an organization, you have to be the place they want to come every day.

Most of us focus on differentiating our products and messaging, with much less consideration of how to differentiate our company and culture to employees. Being different and being better are keys to being less volatile with less turnover. Part of separating from the pack comes down to understanding your market — both geographic and psychographic. But part of it is just focusing on people. One of the things I learned over 20+ years of entrepreneurship is that it’s the sum of many small things that make people feel appreciated. And when people feel cared for, they’re generally pretty happy.

Making Your Happy Place to Reduce Employee Turnover

There’s no universal recipe for becoming a happy place. But I’ll offer the following ideas to stimulate your thinking around how you could create an environment that people love.

Reality is a Good Thing

First of all, a happy place isn’t always happy. Puppy dogs and rainbows give way to reality — people get fired — all news isn’t good — numbers get missed — mistakes happen. But transparency, honesty, and accountability make harsh realities a regular part of work life, which makes them less disruptive and jarring.

Be Present and Interested

Being present is a management mantra that trickles through the fabric of a company. Someone asked me yesterday what kind of CEO I was. I was the kind that worked very hard to be present in meetings — not self-important on my phone, or disinterested in the room. I was the kind who tried to greet everyone by name and to express genuine interest in their lives. I was the kind who expressed gratitude for something before expressing dissatisfaction for something else. Empathy is meaningful clay for a positive culture, and it starts with management.

Perks are Better Than Benefits

Okay, I may have just lied. Benefits are requirements of your happy place. Your market dictates how good those need to be and the percentage you pay. Perks are icing on the cake. And, it turns out, icing is pretty sweet. Perks are great differentiators because they are discretionary. If you’re small, you may lose to the big box SaaS on benefits no matter what you do, but you can still beat ’em with perks. Thoughtful perks are like happy-place superpowers because they’re both empathetic and discretionary. Here are some perk ideas that have a non-zero contribution to the happiness quotient. By the way, the whole is greater than the sum of the parts, and your perks will vary with your people.

• Unlimited snacks and beverages (with a suggestions box)
• Fresh fruit daily
• Free-flowing caffeine — both coffee on demand and espresso (of course)
• Beer and wine — perhaps only on Friday’s
• Summer Friday happy hour parties
• Fresh donuts and bagels one morning a week
• Fresh, pre-made box lunches one or two days a week
• Fun scents piped into some common areas — we liked the scent of sugar cookies
• Music piped into some common areas
• Living and playroom spaces
• Stand-up desk options — personal and common area
• Phone booths and rooms for concentration or privacy
• Periodic in-office massages
• Periodic in-office yoga classes
• Periodic in-office magician (yes, magician)
• Well-appointed and thoughtful mother’s room
• Comfort- and ergonomics-first for chairs and other furniture
• Indirect and pleasant lighting — not dull, not harsh, not blue, not yellow
• Attention to room acoustics, volume, and proximity — loud people together, quiet people together
• Rockin’ tech — hardware, software, wifi, bandwidth — reduce friction
• Memorialization of team activities — photos, photos, photos
• Visual presence and emphasis on vision and values
• Visible transparent accountability — dashboards
• Whiteboard wall paint for non-working walls — let them draw
• Celebratory dinners and events for milestones — quarterly goal busting, for example
• Teambuilding event discretion with directors and managers
• Team birthday lunches
• Tenured employee anniversary announcements (by the CEO?)
• Clear flex-hours policy
• Clear remote work policy and frictionless remote tools

Say What You Mean and Mean What You Say

I’ve seen clarity and authenticity engender deep, lasting loyalty. Mutual respect and trust are huge players in the happy place. When you have those, you’re well on your way to creating a place that people love, and when you don’t, you’ve got issues that run deeper than espresso machines and fresh bananas.

Some Trivial and Some Not-So-Trivial Employee Turnover Solutions

Hopefully, this short list of ideas stimulates your thinking about what makes a place happy for employees. Regardless of your specific approaches to reducing turnover and preserving happiness, you will undoubtedly have a mixture of hard and soft components. This is about the environment, the people in that environment and the attitudes of those people. If you dumb it down to random massages, you’ve missed the point.

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