Losing employees for any reason can be a serious hindrance to your business. Whether they leave for better opportunities or they weren’t a good fit, turnover of any kind can hurt your ability to serve customers. Although every company experiences a certain degree of attrition, too much can put you at a serious disadvantage. This is especially true for entrepreneurs and small business owners who benefit from dedicated employees and high retention. Understanding the causes and how you can prevent it or keep it at a manageable rate can be extremely valuable to the success of your establishment.
Before implementing any plan to slow or reverse your turnover rate, it’s necessary to know the root cause and why it matters. Simply put, your turnover rate is the percentage of employees who leave in a given time frame. For example, a company with 100 staff members that loses 10 within a year has a rate of 10 percent annual turnover. This can be triggered by anything from personality clashes to poor hiring practices to inadequate compensation.
High attrition can mean serious setbacks for your organization. Losing a larger-than-expected segment of your workforce too quickly means you’re losing experience and industry expertise. Plus, hiring and training take time and resources that could be applied elsewhere. As a result, your productivity and customer service suffer, which could mean a higher-stress, distracted workplace where staffers might be nervous, overwhelmed, or dissatisfied. Not only does this lead to a greater difficulty in attracting new talent, but it could also exacerbate the turnover rate and create a vicious cycle.
When it comes to fighting employee losses, prevention is the key. You can protect your business against many of these issues by building a stronger culture. For instance, defining your corporate identity is a relatively simple step that could have solid results. When you express your organizational values and goals clearly, it can help people find a sense of purpose in what they do. Workers are more likely to be satisfied with what they do when they believe they are contributing toward a shared goal instead of simply punching a clock.
Likewise, creating opportunities for advancement gives your staff something to strive for and can keep them motivated. If you constantly hire from outside, you run the risk of alienating those who may be looking to take the next steps in their careers.
If your company is being stretched too thin by the demands of filling positions, it may be time to consider outsourcing your hiring processes. A recruitment firm would have the experience and expertise needed to find candidates who are truly the best fit for you. In general, stronger hiring practices usually means greater success in retaining people.
The loss of any employee for any reason can hurt your business. If you lose too many to keep up, it can be devastating. The accompanying infographic contains more information and tips that can help you handle this problem before it has a chance to cause permanent damage.
Author bio: Pam Verhoff is President of Advanced RPO, a talent acquisition company in Chicago, IL. Verhoff has extensive experience in building RPO businesses and solutions, as well as developing growth strategy.