Managing Turnover: 3 Keys for Keeping Your People [Free E-Book]

Uh-oh. Nicole in Accounting just gave her two weeks’ notice. Not Nicole! How can your company get along without her?

If you’ve ever wondered why so many of your firm’s employees unexpectedly leave for another job, you’re not alone. It’s a common problem in just about every type of business. How can you reduce employee turnover and improve employee retention? First, we’ll briefly explain why employee-retention issues happen and the surprising scope of the problem. Then you’ll learn three proven strategies for successfully managing turnover.

Why Employees Leave

According to the Bureau of Labor Statistics, about three out of five people who leave their job don’t get fired or laid off—they quit. Too often, people walk away from their job not because a great new opportunity has appeared, but because they are unhappy where they are. If they aren’t consistently given the attention and resources they need to thrive in their role, they’ll struggle to be successful, productive workers who take pride in their jobs. Instead, they may become frustrated, give up, and leave. That failure is not what you want, and it’s certainly not what they want.

Learn what your employees need to succeed in our free ebook.

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Managing High Turnover Has Many Expenses

The costs of employee turnover are high.

Some costs can be measured in dollars, such as the hard costs of recruiting and onboarding a replacement. Estimates of those expenses vary widely. One study by the Society for Human Resource Management (SHRM) finds that replacing a salaried employee typically costs an amount equal to six to nine months of that person’s annual salary. Other research suggests those numbers could be even higher, especially for high-wage positions.

Other cash costs of turnover may include lost clients and revenue, as well as overtime expenses for other employees who do extra work until a replacement can be found.

As you can see, successfully managing turnover and improving employee retention can save you lots of money. But when you tally the expenses of turnover, it’s not only about cold, hard cash. Whenever someone leaves, there are many other indirect costs that could be painful for you and your organization. Among them:

That’s quite a list. But now that you have a better idea of what you’re up against, let’s focus on solutions. Fortunately, managing turnover effectively and reducing employee retention problems can be simpler than you may think.

Strategies to Reduce Employee Turnover

Great news: the same strategies that will benefit you and your business are also good for your employees. Everybody wins!

A well-rounded game plan for successfully managing turnover can help everyone in your firm from new hires to seasoned pros. As engagement and job satisfaction grow, productivity and employee retention improve—and issues like absenteeism and burnout diminish.

Here are three of the key steps to help set your company and your people up for greater success. If you’re already doing some of them, that’s terrific—but don’t dismiss them. Think carefully about whether they are working as well as you’d like and what you can do to improve them.

#1 Find the Right Fit

If your company makes widgets, don’t rush to hire the first applicant who walks in the door with widget-making experience. Having the needed job skills is essential, of course—but it’s only part of what makes someone a good fit for your firm.

“You absolutely must have the discipline not to hire until you find the right people.”

Finding the right fit means matching a candidate’s values, desires, and goals with your company’s goals, needs, and culture. For example, you may want someone who will speak up with helpful suggestions. An alert, outgoing person will be an excellent candidate. Or if you need someone who’s able to take on more responsibilities, a candidate who wants training and career development could be just right.

Mutual success and satisfaction follow naturally when an individual’s abilities and interests align with their position and the company’s overall needs. Chances are such people will be more engaged, more productive, and less likely to look for another job.

It may take a little longer to find a candidate who’s a good fit, but it’s one of the most important things you can do for both their long-term satisfaction and your own. As best-selling business author Jim Collins says, “You absolutely must have the discipline not to hire until you find the right people.”

Here’s another point that is often overlooked: don’t forget how important fit is for employees who have been with you for years. Just as your company continues to evolve, your people do too. Sometimes a position that used to be a great fit for an employee no longer is. Watch for this situation and do something about it before you lose a valued worker. Could their responsibilities be changed? Is there a better place for them to be within your company?

#2 Practice Smart Onboarding

Getting your new employees off to a good start helps them go the distance. According to The Wynhurst Group, “new employees who went through a structured onboarding program were 58 percent more likely to be with the organization after three years.”

Thoughtfully planned onboarding helps a new person have a great experience with your company from day one. But helping them succeed requires more than just making a good first impression. It calls for a personalized onboarding process that is tailored to the individual’s needs, role, and performance goals. In a nutshell, during their first weeks and months in your company you help them grow and show them how.

In their book, onboarding experts George Bradt and Mary Vonnegut identify three essential steps for doing this:

#3 Use Employee Recognition Strategies

It’s human nature: we like to do things that we are rewarded for. And who doesn’t enjoy being appreciated? Rewards and recognition show your people exactly what your company values about their behavior and help guide them to success—fostering job satisfaction and loyalty.

Check out our free ebook, 6 Things Your Employees Will Fail Without.

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Here are a few pointers for recognizing and rewarding your people in meaningful ways:

Happy, appreciated employees are more likely to stay with you for the long haul. That’s why smart employee recognition strategies should be a high priority in your overall strategies to reduce employee turnover.

More Help for Managing Turnover

You’ve seen how finding the right fit, smart onboarding, and employee recognition strategies can help you establish a more stable, satisfied, and engaged workforce. Ready to learn more? Great, we can help! Download BambooHR’s free ebook 6 Things Your Employees Will Fail Without (link below). You’ll find additional information and expert advice about the topics we’ve discussed here, plus more strategies and best practices that will help you improve employee retention and success. Who knows, you might even convince Nicole in Accounting to stick around!