By Dan Charney
According to the U.S. Department of Labor and Statistics, turnover can cost an organization 33% of an employee’s total compensation, including both salary and benefits. The impact is not only financial; it also affects employee morale. And, bad morale results in a domino effect that negatively impacts productivity. Obviously, it’s prudent for managers to reduce turnover rates. However, one must first understand the main reasons good employees quit.
As a veteran search consultant, I have heard an infinite number of reasons first hand. Over the years, I have identified and compiled a list of what I feel are the top-10 reasons why good employees quit:
1. The job was not as expected. All too often, the job changes from the original description and what was promised during the interviewing stages. It becomes painfully clear to the new hire that the company played a bait-and-switch game, which ultimately leads to mistrust. The new hire is thinking, “What else are they lying about?”
2. Work/life imbalance. There are times when management demands that one person do the jobs of two or more people. This is especially true when a company downsizes or restructures, resulting in longer hours and weekend work. Employees are often forced to choose between a personal life and a job.
3. Mismatch between job and new hire. No matter how much you love certain candidates, don’t hire them unless they are qualified for the job and mesh with your company culture. Too many times, I’ve seen hiring managers try to fit a square peg into a round hole.
4. Management freezes raises and promotions. Money isn’t usually the first reason people leave an organization, but it does rank highly, especially when an employee can find a job earning 20% to 25% more somewhere else. Make sure your wages are competitive.
Online resources such as www.salary.com or industry associations such as the Material Handling Industry of America, the Material Handling Equipment Distributors Association and the Warehousing Education and Research Council can help you track down accurate information about appropriate wages.
5. Feeling undervalued. It’s human nature to want to be recognized and praised for a job well done. In a material handling operation, recognizing employees is not simply a nice thing to do but an effective way to communicate your appreciation for their efforts, while also reinforcing those actions and behaviors.
6. Lack of decision-making power. Too many managers micromanage down to the finest detail. Empower your employees and allow them the freedom to make suggestions and decisions. I realize that “empowerment” is a catch-all term for many ideas about employee authority and responsibility. However, as a broad definition, it means giving employees latitude to do their jobs and placing trust in them.
7. Too little coaching and feedback. Many managers have no clue how to help employees improve their performance. In addition, supervisors often put off giving feedback to employees, even though they instinctively know that giving and getting honest feedback is essential for growth and building successful teams and organizations. Your role as a manager is to help your people find the right behavior, not just tell them what to do.
8. Management lacks people skills. Remember that many managers were promoted because they did their first job well, but that doesn’t mean they know how to lead others. People skills can be learned and developed, but it really helps if a manager has a natural ability to get along with people and motivate them.
9. Too few growth opportunities. One of the most common reasons employees express for leaving their jobs is lack of challenge and potential for career growth. The most successful employers find ways to help employees develop new skills and responsibilities in their current positions.
10. Loss of faith and confidence in leaders. When employees are asked to do more and more, they see less evidence that they will share in the fruits of their successes. When revenues and profits increase along with workload, employers should take another look at wages. Associates know when a company is doing well and expect they will be considered critical enablers of that success.
Dan Charney is managing partner at Direct Recruiters Inc. (Cleveland), an executive search firm established in 1983. Leading packaging and material handling companies rely on Direct Recruiters to help build solid teams in sales, sales management, marketing, engineering and technical support. Charney can be reached by phone at 440-248-3370, ext. 110, by e-mail at [email protected] or via the Internet at www.directrecruiters.com.