Employee turnover poses a significant challenge for organisations, impacting workflow, productivity, and costs associated with hiring and training. It’s something that, in general, you want to keep as low as possible. With the pace of external recruitment slowing in many sectors it's no surprise that employee engagement and retention is topping the list of HR Priorities in 2023.
However, it's crucial to understand that some level of turnover is inevitable, and in most cases it can actually be a good thing, or at the least, an opportunity for learning and growth. In this article, we will explore effective strategies to reduce employee turnover and leverage its potential benefits. We will delve into the significance of regular "stay" interviews, the concept of desirable turnover, and the importance of leaving a lasting impression when employees depart.
"5% higher engagement delivers value equal to around 10% of payroll, through lower turnover and accidents, process improvement, and higher productivity, innovation and customer loyalty."
― Pete Langford,General Manager of Xref Engage
The Importance of Stay Interviews for Employee Satisfaction
Stay interviews serve as a vital tool for organisations to gauge employee satisfaction and engagement. These interviews enable managers to connect with employees regularly, understand their needs, address concerns, and provide necessary support. Unlike traditional "exit" interviews conducted after an employee decides to leave, stay interviews are a proactive measure focused on employees who are still with the organisation which can generate rich and actionable insights which enable an organisation or manager to proactively mitigate retention risks.
On the downside, given the time required to schedule meetings, summarise and report on the conversations and follow up on action items in person, stay interviews aren't particularly scalable; many organisations may choose to target this effort on high performers, high potentials or senior staff.
So what solutions exist to scale this important activity? In today's digital age, organisations can leverage various tools to streamline and enhance the check-in process. Employee feedback platforms, such as survey software or performance management systems, provide avenues for regular or “always on” feedback collection. These tools automate data collection, offer valuable insights into employee satisfaction, engagement levels, and areas that require improvement and in some cases trigger escalations for immediate in person follow up.
"Pulse surveys allow you to keep abreast of challenges staff face in a rapidly changing environment. This feedback enables timely action that can make a real difference to the everyday experience of staff."
― Pete Langford,General Manager of Xref Engage
Pro tip: There are a myriad of tools out there that offer “pulse” survey tools for your organisation, such as Xref, Culture AMP, Lattice, Qualtrics and Culture Monkey. Finding one that seamlessly integrates to and optimises your existing talent tech stack is where we can help.
Benefits of Stay Interviews
Regular stay interviews yield several advantages for both employees and the organisation. They foster a culture of open communication, build trust between managers and employees, and facilitate timely feedback and support. Proactively addressing concerns helps prevent potential turnover and increases employee retention rates.
What else can be done?
Stay interviews are just the first step of improving employee retention. At the end of the day, they are simply a data gathering tool, and what you actually do with that data is what’s important. For example, it’s no use collecting months of data from hundreds of employees expressing a need to Work From Home if you don’t actually implement any changes to your WFH policy.
Once you’ve got the data from your stay interviews, and shown your employees that you care about their continued well-being, it’s time to actually work on implementing those changes. Some changes will require the implementation of a new type of technology, which is another area we can help.
By the way, this isn’t to say that you should stop doing exit interviews. Exit interviews are still a valuable tool for learning why an employee has left. Many companies assume employees quit due to financial reasons, and will try to coax back employees with a financial counter offer. While this might work in the short term, it’s essentially papering over the cracks - if you’re not understanding and addressing the core reasons why your employees are leaving, then all you’ve done is delay the inevitable for another 6-12 months.
“It’s easy. Treat employees fairly and respectfully. Listen to them. Help them get what they want and need. Thank them. Challenge and develop them. Care about them, and you will engage and retain them.”
― Beverly Kaye, Love 'Em or Lose 'Em: Getting Good People to Stay
What are the different types of turnover?
When talking about employee turnover, we can generally group it into three main buckets: desired, undesired, and forced.
Desired turnover refers to the voluntary departure of employees who no longer align with the organisation's goals, values, or culture, or whose potential and performance are below expected levels.
Undesired turnover is when an employee with high performance and potential decides to quit, and cannot be retained despite intervention.
Forced turnover can fall into several categories but is usually the result of cost-cutting or reorgs that lead to redundancy. Retirement and death in service also falls into this category. Essentially, it’s turnover that you probably don’t want, but can’t really do anything about.
Embracing Turnover as an Opportunity
You’ve done all you can to reduce turnover, you have to accept the inevitable. Turnover will happen. But, it doesn’t always have to be a bad thing. If you can make as much of your turnover desirable as possible, and use undesirable turnover as an opportunity for growth, there can be a bit of a silver lining to it all.
Contrary to intuition, desirable turnover can be a positive outcome for both the employee and the company. Performance management and termination of an undesired employee is a messy process that can cause headaches and lasting after-effects for all involved. It’s better for the company, and the employee, if you can create a positive pathway for desirable turnover.
Achieving Desirable Turnover
To achieve desirable turnover, organisations should focus on creating a supportive work environment that encourages growth and development. Providing opportunities for skill enhancement, career advancement, and ongoing learning enhances job satisfaction and engagement. By fostering a culture of continuous improvement and trust, organisations empower employees to seek new opportunities and make voluntary transitions when necessary.
Essentially, when employees feel like they’re not right for the company, the company should provide support to transition them elsewhere. Many companies make use of recruitment coaching software and providers to help prepare outgoing employees’ resume and skills for a new role. Trying to make the transition as pleasant as possible will be beneficial to everyone.
Benefits of Desirable Turnover
Desirable turnover brings forth positive outcomes such as fresh perspectives, innovative ideas, and increased diversity within the organisation. It facilitates the introduction of new talent, skills, and experiences, contributing to the overall success and competitiveness of the company.
Valuing Boomerang Hires and Referrals
There will be times when you simply cannot keep a star employee, due to budget, organisation structure, or other circumstances outside of your control. But wouldn’t it be amazing if that employee came back when those circumstances changed?
Boomerang hires are individuals who return to work for a company after previously leaving. Maintaining a positive relationship with departing employees is crucial to encourage boomerang hires. By treating employees who depart on good terms with respect and professionalism, organisations create an environment conducive to their return. Boomerang hires bring valuable institutional knowledge, previous experience, and fresh perspectives to the organisation.
Many organisations have created formal or informal alumni programs to stay connected and engaged with former employees. This could be in the form of quarterly networking events, alumni-specific Linkedin groups, or scheduled newsletters. "Alumni marketing" is fast becoming a focus within Employer Branding Teams.
By delivering exceptional experiences, organisations can transform former employees into brand ambassadors who refer top talent to the company. Referrals from trusted sources hold immense value and can lead to the recruitment of skilled individuals who align with the company's culture and goals
Everyone knows that first impressions matter, but "last impressions" are just as important. Treat your outgoing employees with respect, kindness, and professionalism, and in return, you might get a boomerang employee and years of candidate referrals, or at the very least, a continued customer of your services and source of referrals.
Burn that bridge, and you'll irreparably damage your company’s reputation with everyone in that person’s network, as Virgin Media learned the hard way.
To summarise
In the end, reducing turnover and maximising its benefits is crucial for organisations. By conducting regular check-in interviews and utilising tools like employee satisfaction survey software, companies can gain valuable insights, foster open communication, and proactively address concerns to prevent turnover. Embracing desirable turnover as an opportunity allows organisations to create space for new talent that aligns better with their goals. Creating a supportive work environment, offering growth opportunities, and valuing boomerang hires and referrals can further enhance employee retention.
If you're struggling to get employee retention under control and are interested to find out how Talent Tech Solutions can partner with you to design and implement effective process and tech solutions. Take action today by completing our quick enquiry form.