Employee Retention Strategies—Your Guide for the Best Employee Retention Strategies to Retain Your Best Employees

Employee Turnover is an Inside Job

Ross Blake, “The Employee Retention Manager”

Some employee turnover is inevitable; a spouse gets a promotion in another city or state, or capable employees decide to change careers.

Many employers undertake efforts to reduce or eliminate external "pull" factors such as inadequate benefits that prompt good employees to leave for other employers.

However, most employee turnover is caused internally, by reasons employers usually can at least influence, if not correct.

Many employers also undertake efforts to reduce or eliminate internal "push" factors, including poor work-life balance or boring assignments, that also prompt good employees to leave.

In addition, some employers have managers whose behaviors greatly increase employee turnover, yet they're unwilling to address them, even though they're very costly.

Here's an example. A very successful mid-size advertising agency I'm familiar with was run by a highly independent entrepreneur who was also its founder.

Although the agency's creative and account services were excellent, the president's harsh, critical, insulting, and downright abusive ways of talking to and treating most employees meant the firm frequently had an employee turnover problem.

Capable copywriters, media directors, account executives, and secretaries left on a regular basis. As soon as a resignation was given, the president would apologize and attempt to convince the employee to stay.

Other employees were also brought into the effort, and asked to talk individually with the resigning employee.

It was never successful; not one employee decided to stay after giving their resignation, and most went on to equal, if not better, positions at other agencies.

So the agency went through the process of placing employment ads, recruiting, interviewing, testing, hiring, orienting, and training new employees again and again.

It was time-consuming, and financially costly. Replacement costs for most of these employees amounted to 50% to 150% of their annual salaries.

Yet, even though the president hated such time and financial costs, he refused to change anything about how he communicated with employees.

In effect, he was willing to continue to "do it my way" even though the consequences were substantial and unnecessary.

As long as he was in business and paying himself a high salary, there would be no changes.

Many organizations would not tolerate such an executive.

Some organizations tolerate such managers and executives as long as results, especially revenues, continue, and if they can continue to replace employees, figuring they're staying ahead.

At some point, however, it isn't worth it. The employer gets a bad reputation; qualified people don't apply, or schedule interviews. Competitors find they can easily offer better work environments by making certain their managers treat employees respectfully.

What can you do if you have a manager or executive creating employee turnover in a similar manner?

If you're an organization run by this type of founder, there often isn't much you can do as long as they continue to make a large sum of money; it's what they often went into business for in the first place.

Since money is a key factor, making them aware of employee turnover costs may help.

Be certain all of your supervisors and managers know how much employee turnover costs. They often assume employee turnover is "just a cost of doing business." It isn't.
Communicate that other good or high-performing employees notice such behaviors and may decide to leave even if they've been well-treated. Calculate the turnover costs for replacing these employees, and communicate it.
Set up a new working agreement with them, adding the use of good retention and employee relations skills to their job descriptions, and basing at least 25% to 33% of their bonuses on good employee retention.
Be able to immediately offer them coaching with a trusted internal or external facilitator. Having a solution in hand demonstrates that the organization cares about them, and is focused on making future improvements, not on blame.

Competing with other employers for good employees is difficult enough; eliminate internal causes for employee turnover in your organization.

Remember: since most of the reasons good employees leave are things employers can do something about, this makes employee turnover an inside job more often than not.

What happened to the advertising agency?

Many of the most talented professionals in the area refused to consider working there, and it had to merge with several other agencies, giving the abusive boss several new and demanding partners to deal with.