The long-time (no see?) coming of your staff turnover: Get your organization ready for the impact
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Almost half of workers want to leave their jobs today. Well, just a little less, according to a McKinsey & Company survey that found that “the share of workers planning to leave their jobs remains unchanged from 2021, at 40 percent.” That’s a heck of a big staff turnover.
If you think about it, that’s two out of five people saying they’re planning to quit their jobs in the near future. And that proportion probably extrapolates to any business and organization, yes, including yours.
The Great Resignation Era: Staff turnover is a global trend
The dimension of this global employee turnover is such that several experts refer to it as The Great Attrition or The Great Resignation. This is a big problem for companies worldwide, so the question remains: What can be done to attract (and then, retain) great talent in your organization?
According to Katy George, senior partner and Chief People Officer at McKinsey & Company, the high turnover that we’re witnessing today at a global scale comes from the following three trends among employees:
- The search for meaning.
- The desire for flexibility.
- The pace of technological transformation.
Since these trends have drastically accelerated in the last few years, “employees increasingly are bringing a new set of values, needs, and desires to the workplace, and the worker-employer contract is changing as a result, fundamentally and permanently,” argues George.
Furthermore, today’s technological transformation not only has enabled companies to choose a working model (fully remote or hybrid) but also has been transforming the very nature of jobs and the skills that are required. This has empowered people to change career paths and move across industries more easily.
If companies are serious about tackling the Great Resignation, they need to do two fundamental things:
- Improve the ability to attract talent.
- Improve the ability to retain employees.
That’s why it’s crucial to understand the reasons that push people to quit their jobs. Let’s explore that.
Why employees leave companies: Is it really just about compensation?
People leave companies for multiple reasons. According to Gartner, those reasons can be triggered by the organization, the external environment, and the employee’s work experience and personal life. Let’s have a look at some of the main reasons that people quit their jobs.
There’s nothing that a company can do if one of its employees decides to quit because he/she wants to go back to college or because he/she would like to change his/her lifestyle completely. However, there are several things a company can do if turnover is triggered by the organization and the work experience of the employees.
If you take a look at the set of reasons on the upper left side (in blue), you can see that the lack of recognition and professional growth opportunities as well as poor manager quality represent some of the most important reasons behind staff turnover.
There is, indeed, a broad consensus about the fact that the number one reason for leaving an employer is a lack of career opportunities. “There may be many underlying reasons for the decision, but ultimately employees who leave no longer see a future at your organization,” states Ryan Pendell, Workplace Science Writer at Gallup.
A different McKinsey & Company survey highlighted the following top three factors employees cited as reasons for quitting:
- Employees didn’t feel valued by their organizations.
- Employees didn’t feel valued by their managers.
- Employees didn’t feel a sense of belonging at work.
If you look carefully, all of these reasons are much more relational than transactional. Salaries, promotions, and perks are no longer enough to retain employees and keep people engaged. Modern employees want much more from their job experiences, especially in terms of how they are valued and connected with their organizations.
”They want social and interpersonal connections with their colleagues and managers. They want to feel a sense of shared identity. Yes, they want pay, benefits, and perks, but more than that they want to feel valued by their organizations and managers. They want meaningful—though not necessarily in-person—interactions, not just transactions,” argue the authors of the McKinsey & Company survey.
Ironically, this is what many companies and managers are missing. In fact, there is a significant disconnect between the things that employees value the most and the things that managers believe are most valued by their employees.
Apart from the work-life balance factor, there is a big gap between what employees want and what employers think their employees want. In fact, employers tend to believe that transactional factors such as compensations or workers job-hunting are the drivers of employee turnover.
Because of that, “employers seem to overlook the relational elements that are key drivers for why employees are leaving, such as lack of belonging or feeling valued at work,” argues the McKinsey & Company survey.
Being aware of this contradiction is one of the first things you need to understand if you want to build a solid retention strategy. However, there are many more things you can do to achieve that.
What is a good strategy for reducing employee turnover?
Sooner or later, you’ll need to hire and retain people who want much more than salary and perks from you. If you want to improve your ability to retain this modern workforce, you need to build a strategy supported by technology, meaningful communication, coaching, and career growth opportunities.
1. Use technology to identify staff turnover trends and patterns
Using analytics and Business Intelligence (BI) tools for identifying, predicting and calculating turnover trends and patterns is something that every organization needs to do today. Fortunately, today’s technology allows companies to do all kinds of things. From analyzing recruiting strategies with Tableau to calculating staff turnover in Power BI, the market is full of a wide range of options to consider.
Technology should also be used for leveraging your business culture. “People analytics — such as pulse surveys, natural language processing, and network analysis — can help companies separate the signal from the noise. Empirical data can help managers to understand, for example, exactly why people are leaving, and who is making that decision. Is it parents? Women? Older people? Newbies? On that basis, companies can improve their culture so that people feel more valued and are thus more likely to stay,” explains George.
2. Improve communication across your organization
Talking to your employees on a regular basis should be one of the principles of your retention strategy. “The biggest change managers can make is to increase the frequency of conversations with employees. This makes it more likely that managers will be able to identify concerns, roadblocks and signs of disengagement long before the employee’s last day,” argues Pendell.
However, it is not only about the quantity and regularity of the conversations you have with your employees but rather about the quality of them. According to Gallup’s Perspective on Exit Programs That Retain Stars and Build Brand Ambassadors, “nearly half of leavers (49%) did not have a meaningful performance conversation with their supervisor in the three months before leaving their job.”
This lack of meaningful communication is exactly what we mentioned before about employees who leave companies because they don’t feel valued by their managers and organizations. If you don’t invest time in those kinds of conversations, you won’t be able to retain your staff.
3. Empower managers to provide coaching
If you have different managers in your organization, you should encourage them to provide coaching to your employees. If managers help employees to craft a career path with a focus on the strengths they are bringing to their teams, your employees (and your managers too) will significantly feel more engaged and connected with your goals and the organization.
The benefits of coaching are enormous. As stated by Pendell, “coaching employees through career challenges not only makes for better employees, it makes employees feel appreciated, valued, and connected to your organization—even when immediate circumstances can’t be changed.”
Along those lines, coaching helps you tackle one of the main reasons that people cite for quitting their jobs: a bad boss. In fact, coaching is what separates a bad manager from a good one. “While a boss is seen as an unsatisfiable source of demand micromanaging every aspect of employees’ work, a coach knows their employees are players on a team. A good employer/coach works to guide employees in the right direction by offering advice, support and goals while still allowing their workers to have a high degree of autonomy,” argues Forbes contributor Chauncey Crail.
Coaching is one of the most effective ways that you can use to create an inspiring experience for your entire workforce. This is exactly why Gallup recommends in its previously mentioned report “that employees experience some form of coaching at least once per week in the form of recognition, constructive feedback or encouragement.”
4. Provide opportunities for career growth and learning
As we mentioned before, the lack of career opportunities is the number one reason behind today’s global staff turnover. Because of that, companies need to provide career growth opportunities that allow them to retain their staff and appeal to potential talent in the market.
If you want to provide these opportunities, you need to create a dynamic framework defined by the following two variables:
- Ongoing learning of new skills and know-how.
- A clear vision regarding how your employees can grow within your organization.
There are many practical actions you can implement to create such a framework. In terms of learning, for example, you can implement a reverse mentoring program to bring together younger employees with senior executives in a way that they can learn different skills from each other.
With a program like this, a younger employee could share his knowledge of digital tools with a senior partner while gaining skills in leadership, marketing, or finance from his/her senior colleague. As stated by IMD professors Jennifer Jordan and Michael Sorell, the benefits of reverse mentoring programs are significant and include some of the following:
- Increased retention of millennials
- Sharing of digital skills across your organization
- Driving culture change
- Promoting diversity
In terms of establishing a clear vision for career growth, an article on the Slack blog shares an interesting idea from Christopher Mulligan, CEO at TalentKeepers, regarding in-role growth opportunities as an incentive for ambitious employees who want to advance quickly within the organization.
According to Mulligan, companies should stratify entry-level positions into six positions instead of two or three. “This way, employees can advance by a level every six months rather than having to wait two to three years. Pay raises and new titles do not necessarily need to accompany each role level,” argues Mulligan.
Staff turnover: An opportunity, not a threat
As we discussed early on, employee turnover is real and poses big challenges when it comes to attracting talent and retaining employees. However, these challenges shouldn’t be seen as a threat for your organization but rather as an amazing opportunity for updating your business.
If you want to seize this opportunity, you need to do three things. First, you need to establish a work environment that is more relational than transactional. Second, you need to use technology in a way that you can easily identify turnover and employee behavior patterns.
Third, you need to nurture engagement among your employees with meaningful communication, coaching, and opportunities for career growth and learning. If you are able to implement all this, your company would be in a good position to attract talent and retain your most valuable employees during The Great Resignation era.
Photo by Mantas Hesthaven on Unsplash
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