When working as an employee retention speaker and employee retention trainer, I often hear business owners and chief executives say that turnover is “a cost of doing business.” That simply floors me. First of all, it says to me that to them people in general are a “cost” and not an asset. Secondly, do they not understand that employee turnover is a cost that truly impacts the bottom line? Those leaders that view it as a cost of doing business or certainly act that way are in for a rude awakening. The day is fast approaching when, unless you deal with your employee turnover, you won’t have enough people to run your operation.
Employee retention has to be looked at like any other metric and that is to track it, put a monetary value to what it is costing you and develop an action plan to lower that cost. We track material scrap don’t we? In some ways, you could equate employee turnover as “human scrap” that you have ruined or wasted. Maybe that’s the way we need to start looking at employee turnover if we want to have the right mindset to start dealing with it.
Perhaps these business owners and chief executives need to see the formula that quantifies not only the cost but the level of employee turnover. I have seen organizations that don’t even know exactly what their turnover is. I have also seen organizations with 50% turnover when working as an employee retention consultant and the organization does not know what the cost is of that 50% turnover. If you were scrapping 50% of your parts, you would be forming task forces and committees to figure out why and to come up with an action plan. Well, that’s what you need to do with employee turnover.
Form a task force. Do it immediately. Put key players on it like you would do with any major problem that has to be dealt with. Then, you need to gather data. Use the data to target where your problems are, brainstorm around those problems and come up with some plan of action to implement the ideas that you have come up with. Then, put the plan into action. After that, track your results so you have feedback and can see if what you did worked. Then, implement more ideas and get into a process of continuous improvement on the problem of employee turnover. If you approach employee turnover like you approach material scrap, I guarantee you will put money on the bottom like. After all, isn’t that what employee turnover is? Human scrap!