Employers Should Measure “Good” Turnover v. “Bad” to Improve Policies, Consultant Advises
Good turnover occurs when an employee who performs poorly is asked to leave or leaves the company voluntarily, bad turnover occurs when top performers leave the company, and employers should use “turnover metrics” to see how much a company will save by letting poor performers go, and identifying policies to retain good performers, according to consultant Dakotta Alex in an article for Recruiting Trends.
Alex says that the most common causes for employee turnover include:
- Dissatisfaction with the position – This can occur if the employee was not given a fair job description, their position changed without notice, or they were not challenged enough to do their best.
- Higher paying position offered to employee – In any job market, employees may be swayed by recruiters from other companies.
- Management issues – There may be managers who are difficult to work with. As a result, you may notice a lot of your turnover issues originating from one department.
- Poor performance – Employees that turn out to be poor performers may be asked to leave involuntarily. If this is the case, you may need to look at HR recruitment methods to see why candidates who are not qualified for positions are being hired.
He says turnover metrics are valuable because:
- If your company rewards managers based on the number of employees they retain, you may be able to persuade changes in policy by showing not all turnover is bad. Why keep employees who are not performing well on the payroll? Why should managers suffer because they are worried about how a firing will look on their record?
- If you notice a trend in new hires leaving voluntarily after six months, what are some of the reasons behind this and how can this trend be corrected?
- Are you losing top performers to your competitors? How can you retain talented people who improve the quality of your company?
- If there is a department with higher turnover than others, you may need to examine training, management style, or overall workload.
- Measuring turnover can help save your company money in the long run by pointing out problems early on that can be fixed.