What’s Employee Turnover Costing You
I’m shocked at the answers I receive when I ask this question as an employee retention speaker and employee retention trainer. Most senior leaders don’t have a clue what it’s costing them. In the vast majority of cases, they don’t know what percentage turnover they even have. In many cases, their human resource leader doesn’t either. Clearly, if the human resources leader does know, they haven’t effectively conveyed that to senior leadership. It is a stinging indictment of senior leadership considering that employee retention is probably going to be one of the biggest challenges that their organization will face in the next decade. These same leaders can tell me what their scrap percentage is and what their productivity numbers are but are oblivious to employee turnover statistics.
If you want to get a handle on your employee turnover you need to take the following steps in your employee retention strategies:
- Start measuring your level of turnover for the entire organization and then break it down by department and shift.
- Assign a cost to the employee turnover so every leader in the organization knows what their area is costing the organization in terms of employee turnover.
- Determine what the root cause of the turnover is and develop an action plan to attack the root cause. If you think its employee perks…guess again!
- Look at the amount of money turnover is costing you and then take a portion of that amount and dedicate it as a resource to fund your action plan.
- Begin holding leaders accountable for their level of employee turnover. This is a huge area because if it impacts a leader’s bonus, it will get their attention. We hold them accountable for quality, productivity, etc. Why not employee turnover?
- See what results you get and then try other ideas you generated in order to continue to drive the process.
When you are doing the things mentioned above, keep the C.R.A.P. philosophy in mind. Everything you do should be driven by Caring, Respect, Appreciation and Praise. If you care about your people as a member of senior leadership, you have an obligation to address this issue because it determines how well people are compensated as well as the viability of the operation. As I have mentioned in other articles, employee retention will threaten the viability of organizations in the near future because they won’t have the people they need to properly staff their organization.
Every journey has to start somewhere. The journey of improved employee retention starts with knowing how bad your employee turnover is and putting a cost to that employee turnover.