What is employee turnover? Conventional thought would tell you that the employee turnover ratio is hires compared to terminations over a period of time. Certainly there are complex methods that tell you how to calculate turnover. Companies spend a lot of money to find and understand staff retention rates. A high attrition rate is expensive. Staff retention has to be a priority for every organization.
I would suggest that the traditional methods that teach you how to calculate turnover are wrong! Yes, they can tell you a mathematical ratio and, yes, that number is true. But corporate leaders could be asking the wrong questions about their true retention rate. Instead of asking “what are our employee turnover rates?” a better question is “What is employee retention?” An employee doesn’t have to leave your company to stop working. Recent surveys state that more than 50% of employees today have mentally or emotionally left their jobs. To really understand your attrition rate you must factor this into how you calculate turnover. A disengaged employee could cost a company more than a vacant seat. To truly understand staff retention, employee engagement must be part of the equation. Otherwise companies are fooling themselves into believing their employee turnover rates are simply a mathematical ratio.
The most overlooked fact about employee turnover is this; employee disengagement has to be part of employee turnover rates. Find out who is in the wrong job (see my other posts about job analysis). Add that number to your actual terminations. Then you’ll truly understand your employee turnover ratio.
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Are you still Fishing for employee motivation? This was a popular employee motivation strategy several years ago. There are lots of books on Amazon.com that will teach you about how to motivate employees. Every business wants good employee relations and a happy, productive workforce. Strong and positive employee morale is necessary for optimum productivity. I can’t think of any client who has told me they didn’t want high employee satisfactory. All companies work hard to motivate employees.
Corporate leaders and business owners have a lot of reasons to know how to motivate employees. High levels of employee engagement make their jobs easier. They want less stress in their employee relations. They have profits to increase. They want to sharpen their competitive edge. They want to keep costs low and productivity high. They want to generate more revenue. They want, they want, they want… Are you reading this? They want to motivate employees for all their corporate reasons and this is why most companies fail in how to motivate employees.
Employee motivation, employee satisfaction, employee engagement, and employee relations will never improve if it is all about what the company wants. No one is going to work to make the company better or to reach company goals. Organizations will fail if they believe a slick, new “program” is the way to motivate employees. Employees will only be motivated when they know what’s in it for them. They will increase productivity only when their needs are met. Incentives to motivate employees must be tied to what they value and desire. Strategic employers know this. They work hard to understand what makes their employees tick. Only when employee values are linked to motivating incentives will companies succeed.
Entrepreneurs and business leaders report employee retention is still on of their top 3 challenges.
A 2011 AFLAC Workforce Report found that 18 percent of business owners see the benefits package as a direct influence on an employee’s decision to leave. The report lists voluntary benefits as a way to reduce costs and still offer quality benefits.
What is important to note, however, is that even in a recession and high unemployment, good people are willing to leave their jobs. This makes solid employee retention strategies an essential part of every business opeation. As the report states “it takes time and money to recruit, interview, train and hire a new employee.” Buisnesses who don’t drive employee retention strategies from the top down are going to lose their competitive edge.
If your business doesn’t have a written and implemented plan to minimize employee turnover, today is the best day to start!
When I finished my active duty service with the Navy I took a job as a sales representative. The company sent me to a training session with a world renowned sales trainer. During one session he asked us to list the first word that came to mind when we heard the term “salesperson”. We all listed words like “pushy”, “obnoxious”, and “slick”. He told us that if those are the words 95% of the pubic used to describe salespeople we should become the exact opposite and we’d be successful. For me that strategy worked very well.
Employers can apply this lesson after they read the article linked below. Not only does the article list the most hated jobs, it also provides great insight as to what employees hate most about a job. It’s not what you might think!
Today it is the company with the best talent that beats the competition and increases profits. Employers don’t want their top talent hating their jobs. Read the article then be sure your company is doing the opposite!
10 Most Hated Jobs