When it comes to employee management, most companies have two goals:
- Reduce the cost of turnover
- Improve employee engagement
Unfortunately, many companies do not know what it actually costs them when a driver, technician or salesperson leaves, according to Dick Finnegan, founder of C-Suite Analytics. The number can be different for each of these positions. Your first task is to gather data so you have accurate information on this critical variable.
All too often employee engagement and retention efforts are focused on creating programs you think will make your employees stay. The reality, as I have discussed in a previous blog, is that an employee’s manager has a big influence on employee engagement and retention.
Your managers need to build trust with their employees if you expect them to not only stay but also be engaged in the workplace. Hold your managers accountable for reducing total annual turnover and for reducing first-year new hire turnover.
Here is one fact that might help with retention: there is a direct correlation between the percentage of referrals and retention. If you are not engaging your current workforce in your recruiting efforts, you are missing a big opportunity for finding employees who will stay with you.
It is also smart to set up a systemized review process with your employees. These “stay interviews” are designed to give you information you can use to help you address concerns that might cause people to leave. These are not performance reviews, but rather focus on asking employees why they stay and how you, as their manager, can make their job better. Be prepared to address concerns and provide solutions around pay, development, and workload, among other topics. Your managers should not shy away from difficult or sensitive topics and make sure you follow-up and address employees’ concerns.
Following these interviews, ask managers to predict the likelihood of people leaving and develop retention plans that address the reasons someone is considering jumping ship.
When someone does quit, meet with your managers to find out (1) why they did so, (2) if a retention plan was in place, and (3) if there was anything that could have been done to make the person stay. Then ask the manager if any changes are needed in the way people are hired or managed that could improve retention.
The cost of losing an employee is probably higher than you think. Making a few adjustments in the way your managers interact with employees and putting processes in place to gauge employee engagement can help you reduce expensive employee turnover.