How Employee Turnover May Be Killing Your Business
Employee turnover is becoming more frequent and many companies are having a hard time keeping employees in their seats. Let’s face it – various employment options are more readily available. Employees don’t have to tolerate jobs that are perceived as a dead-end or where the work environment is dismissive or not supportive of staff.
While turnover varies somewhat among industries, Gallup concludes that a 10% turnover rate is an acceptable level of annual resignations. Conservative estimates for the 2018 turnover rate was 23% and growing in 2019.
Besides a strong business climate, why are so many people heading for the doors?*
According to exit interviews (rarely conducted at most companies), the majority of self-initiated departing workers quit because of their managers and the impression that the company doesn’t care if they leave or stay.
I know…you’re thinking here we go, always blame management for disgruntled employees but that’s not the real underlying problem. Most managers are not deranged taskmasters. They do their best juggling time restraints and multiple responsibilities. Middle management leaders simply have never trained to properly coach their teams to foster engagement and recognize individual aspirations and personal goals.
What’s the big deal with 10%, 15%, or 23% turnover?
Let’s look at the hard dollar and cents cost of replacing a valued employee. On average, up to 213% of annual salary is the tab for replacing a well-educated executive. This does not take into account the impact on morale, lower productivity while the job remains unfilled, and ramp-up costs to find the “right” replacement and onboarding expenses. Got your attention yet?
Here are some eye-catching statistics from Bonusly, an employee recognition platform:
- 44% of employees would strongly consider taking a job with a different company for a 20% raise or LESS
- 70%+ of employees think they have to leave their current job to advance their career
- 25% of employees are considered to be high retention risk and these are not the slackers but usually top performers with critical skills
- 51% of employees are actively looking to leave their current job
- *Employees who see their manager as genuinely interested in them as individuals and their career aspirations are 59% less likely to seek a new position with a different company.
What’s the solution to stemming aggressive employee turnover?
One of the strongest influences in controlling employee turnover is creating a coaching culture where managers are trained and encouraged to regularly “coach” their team members. Coaching and managing can be delivered by the same person but they are two very different skills. Offering training to managers that define, develop, and foster coaching skills go a long way to retaining valuable employees.
Understand that coaching is a process and not a one and done event. For coaching to be most rewarding with measurable positive outcomes, a bond of trust and transparency must develop between employee and manager/coach. Trust takes time to build and establish and needs to be nurtured and mutually respected.
Recognize that effective coaching requires a commitment of time, patience and implementation of a successful coaching process. Successful coaching is not an informal “that a boy/girl” conversation. It is a defined method that over time effects positive behavioral and attitude change impacting obtainment of corporate goals. In short, it is the ultimate win/win situation.
Sounds great but won’t this take too much time?
Calculate how much wasted time, money, frustration, and lack of productivity results from turnover. The impact of high turnover is far-reaching internally as well as impacting a company’s ability to recruit and hire highly qualified candidates. Word of mouth travels fast and furiously.
Coaching demonstrates an organization’s commitment to its most valuable assets – its employees. By re-calibrating company culture to focus alignment of individual and firm goals, you’ll experience lower turnover, greater productivity, decrease in absenteeism and improved morale. Sounds too good to be true. Try it and stand back to enjoy the results.
For more information on J.Taibi Group – Sandler training, visit us, email us at firstname.lastname@example.org, or call us at 302-377-6435.