Most organizations already know that the dollar amount associated with employee turnover is high, but there are other costs as well. From damage to your brand’s reputation for stability, disruptions in customer service and stalled development as too much focus is placed on training new hires, turnover can be disruptive to operations, which then causes additional financial costs on top of the direct expenses. It’s easy to see how reducing employee turnover is essential, but more challenging to figure out how.
Employee departures negatively impact the emotions and commitment of teammates who remain. Their engagement may dip as they wonder why a coworker left (and might consider leaving themselves) and are likely to feel overworked as they’re asked to take on increased workloads until the backfilled employee is hired and fully ramped. In addition to influencing business outcomes, there can be a ripple effect that can lead to a significant uptick in disengaged employees, who, as a whole, cost U.S. companies up to $550 billion a year in lost productivity.
Hiring Well from the Start
Along with hiring people based on their skill sets and experience, it’s critical to hire for culture fit as well. The current culture of your workplace affects communication styles, decision-making, daily practices and procedures, how formal the environment is and more. When searching for new candidates, it’s important that you include descriptions of your company’s culture and values early in the process as this will help applicants screen themselves and avoid an obviously bad fit. For example, if your office uses an open plan and is highly collaborative, someone who prefers a quiet office and a closed door might not want to apply from the start.
During screenings and interviews, candidates should be asked questions that relate to culture, such as those that ask how one might handle a particular situation. Pre-employment assessments can also help evaluate soft skills such as communication types and the ability to work well in groups. Once a hire has been made, the onboarding process should also include orientation to the culture.
The impact of a poor hire will affect more than just the individual; the effects can cascade across the organization. The more visible the role, the more significant the potential impact so managers and leaders should be carefully screened. Along with the potential to increase employee turnover, a bad fit can wreak havoc on engagement, productivity and morale. Of course, hiring a good fit from the start is only an effective strategy if they’re happy once they are onboard.
Speaking of Company Culture
As important as a robust compensation package is for reducing employee turnover, it’s also an easy-to-solve problem that depends more on budget limitations than bright ideas. Some of the more difficult changes to make are within the organization’s culture, but they can be the most important changes as this is what will dictate the day-to-day satisfaction level of your workers. Some things that are important to today’s workers beyond compensation include:
- Work-Life Balance. If possible, allow for telecommuting options and flexible schedules. Make it easy and acceptable to take sick days and vacation time. Only around half of all Americans use their vacation time, and cite difficulty getting away from work as one of the reasons. According to one survey, 63 percent of employees cited being overworked as the primary reason for leaving their current employer.
- Meaningful Recognition. People want to be heard and want to know that their ideas and contributions are important to the company’s goals. One survey found that respect was the most important leadership quality for workers, while only half of those workers felt respected. At the same time, employees who did feel respected were more satisfied in their positions and more loyal to their companies. The same survey in the previous point found that 50 percent of employees said their employer’s disregard was one of the primary reasons for leaving.
- Purposeful Work: According to Gallup Research, well-being is a whole-life concept that encompasses five life arenas: physical, purpose, social, financial and community. Employees get a charge out of their career when they can answer the question, “Do I like what I do each day?” Unfortunately, in Gallup’s research, only 20% of people answer that question with a strong “yes.” Enabling your managers to have career discussions that help employees align with their own identity will help retain your talent resources. Get people to write themselves into your company story, because that is how you bring them in and keep them in your organization.
Everyone knows they are going to work to help an organization achieve its business goals while acquiring the things they need to care for themselves and their families (pay, health insurance, retirement funds). However, there is a great deal of room for every company to make these relationships less transactional and more fulfilling for their teams. When the culture is structured in such a way that the workers feel valued, supported and treated as an entire human being, they will be more likely to stick around.
Opportunities for Growth
Stagnation is another major contributor to employee turnover. Most people want to be challenged and learn new skills, especially in the face of constantly changing technology, and most people are working toward a long-term career goal. They are going to start feeling restless if they are not advancing toward that goal in meaningful ways or falling behind the technological curve. By providing ongoing training, education and mentoring, organizations can support the objectives of their employees while enjoying a highly skilled workforce in return.
Not everyone is going to be satisfied with the same learning style; research has shown that people learn in different ways and at different paces. Data-driven learning solutions are the modern answer to accommodate a variety of learning styles while staying away from expensive, one-size-fits-all solutions that simply do not fit all. Plus, the information collected about what content an employee is accessing and which formats they seem to prefer will lead to better tailoring of the program for the employee over time.
Leave Room for B Players
Every organization strives to hire and retain the shining stars in their industries, but every leader needs a team of players who will deliver steady, consistent results. Rather than wishing you had a roster of A-list players, take some time to appreciate the deep value that B players contribute to an organization, especially as this group tends to be less concerned with their personal trajectory and more focused on the outcomes of their employers.
To keep this group engaged, make sure their positions are a good match for their strengths, skills and desires. Take the time to understand what drives these individuals and how they go about their work. Make sure they’re not being ignored simply because they don’t make enough noise or step into the spotlight often enough, while the squeaky wheels get all the attention and resources. Intentionally seek out these critical supporting employees and give them as much development, appreciation and opportunities as those who loudly and relentlessly pursue them.
Satisfied Workers Stick Around
Reducing employee turnover can be condensed into one idea: making people happier in their jobs. When the compensation packages are inviting, the company culture built around the success of the entire person (not just their worker personas), and when plenty of room for learning and growing is made available to everyone, the result will be a workforce that is committed to delivering strong outcomes for their employers for the long haul.Read More