HR Magazine (yes, I do have a racy reading selection) offers a very interesting Cover Story in its July 2012 edition. “Drive Turnover Down” covers a wide array of the factors involved in employee turnover. Without re-hashing the entire 5-page article, a few items that stood out:
- As could be expected, “voluntary” turnover is fairly static ~ employees are still unlikely to leave a job on their own terms.
- “Right Management” conducted a survey in 2011 (albeit a sample of only 1,000); 84% of respondents indicated they would search for a new job in the upcoming calendar year.
- HR still struggles with the appropriate way to utilize this metric.
Wasn’t too long ago that low Turnover rates were trumpeted as an indicator of an employer’s inherent value. The Fortune “100 Best Companies to Work For” almost always highlighted companies that had 5% (or less) turnover ~ clearly, the fact that no one wanted to leave the company indicated it was a wonderful place to work.
We know in retrospect that may not be a clear indicator of the actual situation ~ “comfortable” may be a more accurate term to describe the retention rates prior to the economic downturn of the late ’00’s. When the headcount squeeze began in earnest, many companies may have been (pleasantly) shocked at the ease in which the first cut was processed. That brief period of productive turnover eventually led to more painful cuts, but one lesson was learned by all – “turnover” is a wiggly term.
Human Resources, which had hung its collective hat on “low” turnover, became more cautious in aligning turnover rates with successful business practices.
As HR professionals, we need to hone our attention on two very specific groups:
1. Key Employees ~ Who are they? What is their respective engagement level? What is the plan should they leave? Force the issue with your business leaders.
2. Performance Issues ~ We know the employees on “formal” performance plans; how about the employees who aren’t on the PIP radar? If you’re paying attention, you KNOW who these employees are ~ push your leaders to take action; manage them up or manage them out. Period.
That’s the problem with a “statistic” that disguises itself as a “metric.” Unless you are 100% certain about the mechanics behind the number, it’s best to walk lightly.