Why do Employees Leave you?
Question – what is your Employee Turnover?
If you don’t know, we suggest you find out. In brief terms it is the percentage number of employees who voluntary (or where you terminate their employment - involuntary – we suggest you measure both) leave your workplace compared to those who stay in your employment over a time period. Normally its expressed per calendar year. So 10% turnover out of a total staff complement of say 100 means you will replace 10 staff members per year (assuming your overall number of staff remains the same).
It’s a really important question as it provides a good window into your organisational culture with a measure you can also apply when benchmarking your organisation to others. Too low a turnover can in itself raise questions round how people are being managed (or if they are being effectively managed). To high of course raises the similar questions but with likely different answers. The trick here is understanding what the figures are telling you i.e. the WHY of the turnover percentage.
Employees quit for many reasons and they are not all about your workplace or management. However in many cases it is likely they will be. From an HR perspective you should be thinking every day - why do your employees stay with the organisation.
Ask them why they stay with you?
If you don’t ask you wont get. Understanding what makes up your employee turnover - the why – should give you insights as to what you can do about it. We would suggest that even making the effort to show employees you are interested in their views and that the organisation wants to have a good workplace will pay dividends for you. So do ask around but lets be honest – your from HR – they wont tell you everything.
So what other key items should you look at:
By this we mean the employees boss. There is a popular saying in HR: “that people leave managers – not organisations”. We think this is perhaps overly simplistic. However, a boss is an integral part of an employee’s relationship with the organisation. A bad relationship will often be the lightening rod for expressed dissatisfaction. So look into the following. Are there patterns to people leaving? Are they leaving particular managers? Is it particular job roles or departments that overly suffer? Being a manager can also be tough on the manager. Sometimes a bit of training, coaching or mentoring the boss/manager can really pay dividends here. Even if you have a stringent performance management culture that you think is adding to pressure the way a boss interacts and manages staff can have a major effect.
Next to the boss they are the next thing that employees often say they value most about a workplace. Just think of those; leaving emails, tales of people getting engaged at work, of friendships that persist once an employee leaves the workforce. It all happens. Having friends at work keeps people at work and can be good for lowering your turnover. You can help in this by creating the ‘space’ and ‘time’ for such friendships to develop. Drinks after work, group activities, relaxation areas are all things that enable employees to interact and get to know their coworkers.
If you are a tech business then a tip from us - we have really noticed that software developers like pool tables, pinball machines, PlayStations they can dip into every now and again whilst at work. If you know software developers, you will know they tend not to be overly chatty especially outside the immediate coding team. However, if you have a game with them they really open up, and become …. almost human .
The underlying purpose here is to helps create an emotional tie or bond with the organisation. Another reason to stay.
The wrong people get promoted
This is a double whammy. Not only will you have relatively poor performer who now probably costs you more (you did also give them a salary rise – didn’t you). You have just demotivated others who might just have been thinking about making a move upwards themselves. In their eyes you have just devalued promotion prospects and made them wonder what skills and experiences are really valued. We always stress this when looking at internal staff applications in our systems - they need handled very carefully and with extra consideration. Letting an internal candidate down because they did not get the job can – if done right - motivate them to try again or, make them very sorry they put their head above the parapet in the first place. So be aware of the signals that will be sent when you promote – they will happen anyway.
Salary (the package of money and benefits)
This often gets missed off. However many businesses downsized compensation packages following the 2008 recession. If your market is not in dire straights perhaps you should, have another look and check what your employment package is vis-a-vis your potential competitors. Remember not all competitors for staff will necessarily work within your market sector.
From what we see its seems to be often the small things that can cause resentments. The fact that staff used to on occasion go out for drinks or they got performance bonuses, or rewards for referrals, or a mobile phone allowance. Each organisation is different but people often talk about benefits that used to be there and which now aren’t (the good old days). If you can’t or don’t want to reinstate all of them, then do some and make a big thing out of it – so they know the organisation is trying. People are realistic making an effort counts a lot.
Not developing people
When you think of the cost of hiring people – even if you are not using agencies - the expenses and opportunity costs add up. So, it makes sense to get the most out of them. Many organisations stripped away training and development programmes after the recession. Maybe you don’t want to go back to those days and felt the cost was too high. However, growing your own people can often make good financial sense. Yes, some new blood from outside can also help change things. But most organisations function best when they encourage and support employees taking on new activities and responsibilities.
Not doing this will likely have an employee turnover cost. Will your best employees with the highest potential be happy to stay doing the same old thing year in and year out? We would suggest not. Give them challenges and create new roles and you will see less employee turnover.
There are other things you might add to this list. However, from what we see these are the big hitters in terms of why employees might leave you. They are also ones that you can do something about and are fairly applicable to most organisations. If you focus on these items, you will be building both a better workplace and one that is actually easier to recruit for. It’s a win win.
Also please don’t neglect your careers website. Properly done your careers site and it’s supporting materials should articulate why your organisation is a good place to work at. It is there to attract prospective employees. But do remember it will also be viewed by your current ones as well. It should show that you care about - why people would work at your organisation. It is also a tangible reminder to those already working as employees, what your organisation can offer.