A Coming Hurricane of Change: Turnover Is In the Air
Written by Jeff Hughes, on September 21, 2021
It’s no secret that COVID has upended traditional working norms. Many people have been forced to work from home for months on end. The Delta variant of Covid has delayed planned employer-driven return to the office. Who yet knows what effect other variants will have on the delay of return to the office.
But the iceberg runs deeper…
According to the Society for Human Resource Management (SHRM), “more than half of employees surveyed in North American plan to look for a new job in 2021, while a quarter of workers plan to quit their job once the COVID-19 pandemic subsides and recruiting efforts to ramp up.” Their reasons for their planned actions: Disengagement and burnout, feeling less connected to their company, diminished company culture. While company leaders are focused on fending off the pandemic economically, it is important that employers simultaneously address these critical areas of concern related to turnover. For that has big economic implications as well. Keeping in mind that it takes on average 51 days to hire a replacement, an undertaking to retain top talent requires both thinking and acting in a new paradigm and taking more traditional retention actions.
Many employees feel that working at home is more productive and less stressful than having to commute to work. Studies have shown that workers are more productive working at home. These at-home workers are generally worried they may be missing out on job advancement unlike their co-workers who work in the office, so many work harder and longer hours as a result. This concern may prove true as the majority of bosses still find themselves more comfortable having staff in the office for both rational and irrational reasons, most having to do with command and control.
In another article, I have described the need for there to be standardized performance matrices that measure productivity and work quality that can be applied universally over those who work in the office and those who work from home or work in a hybrid model. In that other article, I expressed the need for there to be a consistent and periodic review of productivity and results between the supervisor and the employee to be sure that the employee is meeting their written obligations and objectives.
One area that was touched upon was the need to ensure those job applicants and the company to which they are applying share common values. Not only should these values guide business decisions, but they also give purpose to the Missions Statement. These Core Values congruities are equally important for those who are already employed with the company. Promoting Core Values within the organization help to shape the culture of the organization. Both of these, Core Values and Culture, are central to the issue of hiring the right people and retaining the best people. 67% of employees want to work for a company with a mission they believe in. The Mission creates a common goal beyond profit. The Mission Statement is an essential part of any well-wrought business plan.
What are the conditions for optimum retention? And what can you do to ensure they are operationalized in your business? The first place to start is with a sound Core Values statement, an aligned culture, and work expectations that are clear and achievable. It’s going to take a revolution of thinking and action to convince a recruit, one with many options, that yours’ is THE place to start a new career. Demonstrating Core Values in the interview helps an employee determine if they align with that of the company and can make for a better hire if there is congruity of thought.
In referring to turnover in this article, I am referring to voluntary turnover. Before the pandemic, 3.6% of workers left their places of employment each month. It’s been calculated that turnover costs may run from as high as 100-200% of an employee’s salary. And there are hidden costs of turnover that affect the performance of those continuing to work in the organization. These include time taken away from primary work; depleted morale from losing co-workers; having to work harder; and high turnover tarnishing a company’s brand.
Few employers want to be known as a revolving door company. Turnover can lead to further unwanted turnover if working conditions are not well managed. A company’s leaders must understand the causes and costs of voluntary termination and take action to correct any flawed supervisor behavior and company culture.
What makes a productive and possibly high potential employee leave a company? Let’s begin with employee engagement. By employee engagement, I am referring to the employees’ emotional state where they feel passionate, energetic, and committed toward their work. In turn, the employees fully invest in their best (working) selves. They put their heart, spirit minds, and hands into the work they do. Both positive feelings and productive action are reflected in highly motivated and engaged employees. 60% say that they would work longer hours for less pay to have an empathic employer.
But it’s up to leadership to create a work environment where employees get and stay engaged. Two factors come into play when establishing a non-toxic work environment where employees can thrive: Company Core Values and Culture. In the process, these two elements must constantly be talked about by management to employees. The employment of Core Values helps keep employees and leaders marching in lockstep. Culture is the bedrock of the employee experience. 47% of voluntary terminations occur because of toxic culture… created by the behaviors and actions of management. An even greater percentage of voluntary terminations, 68%, occur when employees don’t feel supported in their work by their manager. And the number one reason why people leave voluntarily is the absence of career growth opportunities. That number is a staggering 72%. These three areas, coupled with a preponderance of one-way communication from the top and failure to recognize achievement, are the biggest culprits that lead to voluntary turnover.
Research illustrates that 75% of turnover is preventable. When one looks at the main reasons for turnover, it becomes apparent that leadership plays the primary role in creating an environment where this deterrence to turnover can be mitigated. It takes a commitment to create a work environment that is conducive to constructive two-way communication and provision of recognition for a job well done. 72% of the companies report that employee recognition has the largest impact on employee engagement. A method of communicating appreciation, whether the worker is remote or in the office is necessary. One way is by using One Page Business Plans as a vehicle for doing just that, as many of our clients have done for years.
Measuring employee engagement can be done through employee surveys, more direct and regular constructive communication between the supervisor and the employee, where employee suggestions are seriously considered and acted upon, and the establishment and maintenance of a culture of caring to boost higher employee engagement. Those top companies in the top 20 of highest retention enjoy a boost of 31% high retention over other companies when employee achievement is recognized.
Employees who have been doing a job for a while generally have suggestions on how to make the work more efficient and even more satisfying. Seek out your employees and LISTEN and then ACT. To reduce turnover conduct both exit interviews and third party administered “stay interviews”. Exit interviews have revealed the reason people leave is that they feel unappreciated, discouraged from trying new ideas, and ignored when giving feedback. They feel shut down by their supervisor. Most noteworthy is that 66% of those who leave feel unappreciated. It is not that hard to tell someone when they are doing a good job, to encourage job ownership, and to pay attention and act on feedback. It just takes caring about the employee. Isn’t that what bosses are supposed to do? Another antidote to recognition comes in the form of peer recognition. Peer recognition helps build a strong environment of appreciation and positive feedback. This can be done in a team stand-up, either virtually or in person.
We’ve all seen the destruction that hurricanes have caused along the Gulf Coast. It takes years for people to recover. Do you want to place your company in the path of a self-created hurricane? If not, get with your HR department and craft a multi-faceted employee retention initiative. The stats don’t lie.
One organization created an algorithm such that with 500 employees, with an annual, average salary of $65,000, for every 90 employees who leave per year the cost is $3,000,000. Think what solid retention can do for your bottom line!
Take action now and don’t get caught in the hurricane unprepared.