What to Do When Your Best Employee Retires

Many businesses are fortunate to have an employee — or several — that excel in most areas. They're excellent with clients, complete work effectively with timely fashion and have been integral in the business' growth.

Retirement is imminent at some point, though, which means that businesses must brace for their best employee to make an exit eventually. Fortunately, a successful business is much more than just one person, which means that with prudence and foresight, a company can successfully navigate the retirement of their best employee.

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Initiate the Knowledge Transfer Process

The transitioning of crucial responsibilities is integral to a business successfully dealing with the retirement of a key employee. First, identify and subject areas and knowledge items and list them in order of importance.

Then, group impacted employees into teams, with those with more knowledge of the business leading over those in a more protege-type role. Each unit can develop a schedule of transferring knowledge items, aided by transfer tools like flowcharts, mind maps and RACI charts.

The transfer of critical and tacit knowledge via charts and maps can be invaluable, catering to the more visually-minded. Store these completed transfer tools in a shared location, like Google Drive or SharePoint.

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In general, businesses should inform their current employees of the situation and how their role may change due to the departure of a longtime employee. Put employees' minds at ease by informing them that this opens up more opportunity for them, rather than limits them. Frame the employees' departure as an opportunity, rather than a setback, all while celebrating the departing employee as a good model for success.

Don’t Rush a New Hire

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Some businesses rush to replace a retiring employee. This approach makes sense since a departing employee can cause uncertainty. Rushing a hire is always a bad idea though. Emphasize proactivity instead of reactivity. Breathe a bit instead of overreacting and hiring someone that lacks expertise.

Take some time to scope out the best fit for the position. There may be an internal option that's ready to take charge. Alternatively, job fairs or industry expos can open doors to new prospective employees. Either way, view the replacement of a key employee as a gradual process, rather than one that requires immediate, hurried action.

Use the Departing Employee as an Example

Current employees will perceive the treatment of the retiring employee as what they can anticipate when they retire. If a business treats a retiring employee dismissively or with disdain, then current employees may lack the motivation to get passionate about the company. Alternatively, if a retiring employee receives ample praise and celebration, such as in the form of a nice retirement party it will show current employees that the business values their employees. Go ahead and get the retiree a gold watch, which is the traditional retirement gift. You can get a nice one without spending a fortune, and the employee might be looking forward to or expecting it. The last thing you want to do is send them off disappointed with a mediocre gift.

Businesses should use the retiring employee as an example for present employees in several ways, from excellent treatment upon news of retirement to praising their numerous accomplishments throughout the years.

A great employee’s retirement can cause headaches for some businesses, though it’s entirely possible with the tips above to react with prudence, patience and respect, so current employees value their employer more than ever.

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