Reducing Employee Turnover

Wednesday, October 30, 2013 - 07:25

By Leon Gettler

It costs companies thousands of dollars when employees quit. There are recruiting expenses and time is spent training people and making sure they’re up to speed. Keeping a lid on turnover is every manager’s responsibility. What’s the best way of doing it?

The Wall Street Journal has some simple steps. Make sure you hire the right people from the start. Interview and vet candidates carefully, not just to ensure they have the right skills but also to ensure that they fit well with the company culture, managers and co-workers. Managers have to make sure the pay packages are right and they might have to get creative when necessary with benefits, flexible work schedules and bonus structures. Every year, they should review compensation and pay to make sure they are keeping up with market trends. They should pay close attention to employees’ needs and provide flexibility where they can. They have to outline challenging career paths so that employees know how to get there. This is where performance reviews and discussions are so important. And finally, they should create an engaging workplace. Simple emails of praise at the completion of a project, monthly memos outlining achievements of the team to the wider division, and peer-recognition programs are all ways to inject some positive feedback into a workforce. A thank you note can work well, particularly when higher-ups are copied into the note.

The Centre for Organisational Innovation in Sydney has similar advice but also recommends managers ensure there is lots of career development and training.

The Monster.com site says managers should listen to staff. “Encourage your employees to form a committee that can discuss the issues that matter to them and have representatives who can come to the management team. You won’t be able to take on all their suggestions, but it’s important to give them your full consideration. You should also look to run anonymous surveys to get the ‘real’ feelings of your employees.”
Managers also need to be proactive if someone announces that they’re leaving. “Firstly find out from them why they want to move on. Are they going for a new opportunity that is too good to turn down? Is it purely for the money? Are they quitting work altogether to take on charity work in Africa? You need to analyse their reasons and work out what you can do to change their mind. If you’re not successful in persuading them to stay, make sure you hold an exit interview with everyone who leaves the company. You will be able to get some frank and honest opinion on how your business operates and you may discover something that you can change to prevent further losses.”

Business Victoria says managers should encourage friendly competition in the workplace where appropriate (e.g. measuring and communicating sales figures and production targets), ensure that any issues raised are dealt with promptly, fairly and transparently, ensure there are opportunities to “touch base” with managers through the year to discuss issues that are important for the employee and measure performance so that underachievers can reach the required levels and high performers are rewarded.