HR Management Indonesia A Guide to Improve Employee Retention

HR Management Indonesia: A Guide to Improve Employee Retention

  • InCorp Editorial Team
  • 16 May 2023
  • 3 minute reading time

Struggles of High Turnover Rates

High turnover rates are something that almost all Indonesian companies struggle with, irrespective of industry and business size, especially with the millennial workforce that tends to move from one place to another after just two or three years of working in a company. This situation pushes companies to develop HR management strategies that would motivate employees to stay longer. The traditional method of retaining employees is through pay raises and bonuses. Salary increment is a powerful tool that is not only often used to keep employees but to attract other employees as well. In that case, some Indonesian companies often hijack talent from other companies through salary wars. These two factors are effective motivation boosters for Indonesian employees. Employees are offered higher salaries and better benefits as an incentive to leave their old job.

Indonesia Employee Engagement

Indonesian companies who seek to create sustainable and long-term growth should initiate employee engagement programs. The programs should involve strong workplace collaboration and aim to generate valuable interactions. The process should start from the recruitment to the onboarding process. Also, the actual employment should be done in practical and engaging ways that give an enthusiastic vibe and encourage them to perform well.

Employee engagement programs are a relatively new concept for Indonesia. Unlike Hong Kong and Singapore, Indonesian companies have just started to adopt such an approach. Indonesia has found difficulties in developing a suitable engagement program as it requires a large amount of investment. Despite its attempt to engage employees, companies still struggle to retain employees.

This event happens because Indonesian companies are often too focused on aspects such as salary increments, bonuses, and promotions as a means to engage employees. However, other factors may be beneficial to increase the overall experience of the job and make the entire experience more enjoyable. Thus, conducting proper engagement would act as an incentive for employees to stay longer despite various offers.

How to Boost Employee Retention during the Pandemic

The pandemic has been going on for two years now. With no definite end in sight, employees often feel unmotivated and isolated. To avoid burnout and ensure employee retention, there are several things that an employer can do. First and foremost is prioritizing employee wellness by enforcing safety guidelines in the workplace and adequately providing healthcare plans. It is also integral to listen to your employees.

Conducting feedback sessions and one-on-one conversations would allow employees to share their thoughts on improving the general conditions of the workplace. Flexibility is also something that can be offered to improve the employment experience. The flexibility can be formed through their schedules and also through the management style adopted. Other similar approaches may be implemented to make employees feel comfortable and want to stay.

How HR Outsourcing Services can Boost Employee Retention

Studies have shown a direct correlation between employing an HR partner and decreased turnover rates. Lower turnover rates automatically mean reduced costs for employers. Outsourcing an HR firm would allow for a higher quality of service provided and dedicated to the employee’s satisfaction. As discussed before, satisfied employees have a lower tendency to leave their positions and boost employee retention. A company can develop better hiring practices and streamline the process as mentioned above, thereby benefiting all parties.

Furthermore, the burden is also lifted from the internal HR team, thus allowing them to fully allocate their time and resources to create a better company culture for existing employees. InCorp provides services regarding recruitment and HR establishment. Drop your question through the form below for a further discussion with our consultant.

Pandu Biasramadhan

Senior Consulting Manager at InCorp Indonesia

An expert for more than 10 years, Pandu Biasramadhan, has an extensive background in providing top-quality and comprehensive business solutions for enterprises in Indonesia and managing regional partnership channels across Southeast Asia.

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Frequent Asked Questions

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According to the Indonesia’s Manpower Law employers can hire the Indonesian talents either under a temporary or a permanent contract.

As soon as you decide you’d like us to be your Employer of Record, the onboarding process starts and will take approximately 5 days in our HR and Payroll department.

As a professional executive search agent, InCorp helps promote job vacancies, screen and shortlist, conduct pre-interviews, and arrange a final interview with applicants. This can also be complemented by conducting an employee background check.

Cost reduction, hiring time reduction, hire quality are among the most noteworthy benefits your company can enjoy.