As soon as an enemy unit's flag starts flashing red, I pull one of the units fighting them away - much easier to capture/kill when they are routing, plus if you kill them all, there's less money for you when you ransom them later.

If one of your units does it, I suppose there is an added advantage that it ties up 3-4 enemy units in melee for longer, allowing you more space to maneuver your other troops (if you have any left).