Tag: employee turnover

Related to and stemming from transparency is honesty. Employees stay when they see honesty and integrity as company values. Lack of trust in leadership severely damages retention.

Telltale signs that your practices are creating a trust gap include:

• Policy changes or decisions made without explanation
• Perks taken away without reason or input 
• Pay or hiring inequities without remedy
• Refusal to share business challenges transparently
• Punishing dissenting perspectives as disloyal
• Scapegoating certain employees or teams
• Leadership not holding themselves accountable

In working with hundreds of clients over the years, we have seen the tremendous damage that forms when a “trust gap” emerges between leadership and employees. This trust gap, fueled by a lack of transparency from upper management, creates cynicism that corrodes company culture and retention.

The trust gap widens with each instance of leadership concealing information, refusing to explain decisions, or giving empty platitudes without follow-through. Employee skepticism builds with every project implemented seemingly without rationale, policy changed on a whim, or corporate double-speak email.

Absent honest communication, employees fill information voids with their own interpretations, whether accurate or not. Rumors run rampant, assuming the worst of leaders’ motives. Engagement and morale sink as commitments ring hollow. Talent retention suffers as workers feel unvalued.

Restoring trust where a gap has formed takes tireless effort and commitment to transparency from executives. It requires asking difficult questions, listening without defensiveness, and signaling openness through words and actions consistently.

The Transparency Mindset

Managers must embody the mindset that transparency is not just a slogan, but a daily practice. They must recognize how closely watched their every communication is for authenticity, candor and respect for employees.

Work cultures bank on trust. But trust unfailingly flows from transparency. Savvy executives understand honest communication – surrounding both company successes and challenges – builds credibility with employees, not overnight, but through steady reliability. Authenticity cannot be faked.

Bridging the trust gap plagues many enterprises.  If it can be done, however, it pays dividends in the form of engaged, invested employees for the long haul. There are no shortcuts.

Trust erodes when actions contradict policies, values and promises. Double standards breed cynicism. Employees need to feel safe speaking up without fear of retaliation. Companies should minimize hierarchy and seek diverse input.

Allow employees to skip the chain of command with regular skip-level meetings. This practice can also stave off lawsuits.  When employees have a clear line of complaint, they are more apt to bring problems to the company for solutions.

Use your HR function, outsourced HR Department, or a human resources consultant to create a plan that will get you out of the mire of distrust and back to a place where employees feel heard and valued.

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Article Home – Our Ultimate Guide To Reduce Employee Turnover and Increase Retention

TOC – Visit our Table of Contents Page for this engaging and dynamic series of informative articles about Employee Turnover compiled by our expert human resource consultants.

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Transparency and open communication drive employee retention and company success.

Time and again, secrecy sparks rumors, distrust, and turnover, while transparency drives understanding and buy-in. Employees who see openness as a core company value are 31% more likely to stay long-term.

I have seen it over and over in my long career.  And I have experienced it in my own employment journey as well.  The more an employer conceals and tries to keep secrets, the more employees feel like they are being cheated or the employer is hiding nefarious motives and initiatives.

Employees fill in blanks and humans love to gossip.  Juicy gossip is just part of life and it can derail a team, a department, or a company.  The best defense against rumors, inuendo, gossip, and doomsday prognosticating is transparency from the top. 

Let’s look at some research-backed examples across business functions and explore how to better offer transparency:

Leadership

A study by Peakon found employees are 4.6x more likely to feel high trust and stay long-term when executives communicate company vision, challenges, and priorities clearly and frequently.  This can be from the top down, right from the C-Suite through middle management and to first-line supervisors.  You know the saying that people don’t leave companies, they leave managers? Well, this is the basic foundation of that philosophy. When employees don’t feel that they are trusted, compounded with management that seems shady or worse, untruthful, turnover becomes the ugly norm.

Goal Setting

According to Gallup, only 23% of employees strongly agree their manager keeps them up to date on goals and priorities. Consistent cascading of aligned objectives boosts retention according to this research.  Imagine a team of huskies pulling a sled.  Now, imagine that they aren’t all aware of the direction they are supposed to be going.  What happens when some go left and some go right?  Add to that the speed at which they need to run to get to the desired destination.  If some walk while others sprint, it is not helpful.  Every company is a team that is pulling toward certain goals.  When you allow them to pull in different directions because you aren’t sharing real results and realistic goals, they are going to cut loose. Either way, you will never get to your desired destination if your not vision sharing, defining goals and tracking progress.    

Finance 

A Stanford study revealed employees underestimated their company’s financial success when kept in the dark. Sharing metrics like revenue growth and profitability data inspires confidence.  When I was a young professional, one of the tech companies I worked for had a monthly all-hands meeting.  During that meeting, the CEO and COO would share the financial goals of the company and then the CFO would share our progress.  It was an energizing event to which everyone looked forward each month.  We were all excited about hitting the next big financial goal.  After we celebrated hitting $100 million, it became $500 million.  Every level of employee was aware of the goal and everyone tried to do their part.  It also made for employees in all functions seeking sales referrals and reaching out to their network to drum up leads.  That kind of transparency leads to success.  Employees tend to stick with employers that show promise of financial growth and success to which they can claim even some small part. 

Change Initiatives

ChangeManagementInsights.com reported projects with transparent communication have 96% greater success in adoption and engagement.  Can you understand the power of that number? 96% greater success!  Just like corporate goals and financial milestones, company wide projects and improvement initiatives drive retention and productivity.  Foster ownership and buy-in from your employees with group input, contests for winning ideas, and public recognition for significant contributions.

Hiring and Promotions

Social gratification theory research shows perceived fairness of decision processes matters more than outcomes.  HR can be very helpful when it comes to crafting career paths that reward and recognize instead of just being a begrudging process managers go through on an annual basis.  Not to mention, managers often prevent their subordinates from promoting out of roles in which the manager finds them particularly useful.  Use titles and lateral skills training as a recognition and motivational tool.

Transparent criteria in hiring and promoting staff prevent rumors of bias.  Rumors of bias lead to… lawsuits when an employee feels wronged.  If you have to hire instead of promoting from within, be transparent with those you know will feel passed over.  Give them the criteria and the goals you are trying to fulfill.  Show them honestly where they fall short and then give them encouragement and tools to develop into the next promotable employee.  That will motivate them and appreciate the honesty.  It will also help them get behind the new hire and stay with the company as that new hire needs the institutional knowledge and support of those who were there before.

It may be hard to convince upper management to share some of these aspects of the business, but transparency around everything from company vision to individual feedback is proven to boost retention. By shedding light on priorities, metrics and processes, great leaders gain credibility and loyalty. I welcome the chance to discuss transparency best practices further.

Transparency around company goals, initiatives and decisions builds trust – period. Use the following tactics to get there:

• Regular company-wide and team-level meetings to provide updates
• Clear communication around policies and procedures
• Involving employees in giving input on changes
• Cascading goals from leadership so all levels align
• Sharing metrics, financials, and business challenges
• Admitting mistakes sincerely and sharing lessons learned
• Gathering honest survey feedback and taking action
• When leadership conceals information, turnover and disengagement follow.

Transparency shows respect for employees. It breeds understanding and problem-solving versus rumors. Honesty, even around setbacks.  Garner loyalty from your employee with these proven methods.

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Article Home – Our Ultimate Guide To Reduce Employee Turnover and Increase Retention

TOC – Visit our Table of Contents Page for this engaging and dynamic series of informative articles about Employee Turnover compiled by our expert human resource consultants.

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While not the only factor, fair pay reduces turnover risk.

We employ seasoned compensation analysts who cannot stress enough the importance of market-based pay to reduce costly turnover. With today’s transparent job market, and laws making it more so, employees know what competitive salaries look like and will jump ship if they feel undervalued.

Perception is reality.  That is just a reality. If an employee perceives that their pay is low compared to the market or compared to their co-workers, then they will be unsatisfied with their place in the company. This might be the first bee in their turnover bonnet, so to speak.  It can make them start thinking about finding greener grass somewhere else. 

This can easily happen when employees stay with your company for a long time.  These days, a long time can be just a few years.  As salaries in the greater marketplace go up, newer hires – people hired behind that employee will just naturally come in at higher compensation levels.  Unfortunately, raises for incumbents rarely keep pace with the market for outside hires.  This is a vicious cycle and it can cause turnover of good employees.  Even as their institutional knowledge and the capital you build into them grows, their salary and total compensation sinks at a regressive rate.

It is important to keep up with a competitive and real-time, self-correcting compensation policy.  This can be difficult for managers or even busy internal human resources personnel.  A good human resources consulting firm or a compensation specialist can help you craft a compensation philosophy that can keep pace with key market trends and stomp out turnover.    

Here are our research-backed tips on getting compensation right:

Benchmark frequently – Conducting regular market pay analysis, at least annually, ensures your salaries don’t stagnate versus industry averages. Tools like salary surveys and pay model algorithms accurately gauge market rate.

Segment carefully –

Break down pay analysis by role, experience level, geography, responsibilities, and skill set. A software engineer’s market rate in San Francisco differs greatly from an accountant’s in Omaha.

Weigh total rewards –

Beyond base salary, assess incentives, equity, benefits, and perks in your mix versus competitors. The total value proposition matters.

Address inequities –

If pay gaps are found for similar roles, fix them quickly. Nothing drives out high performers faster than the perception of internal inequity.

Communicate pay strategy –

Compensation doesn’t have to be secretive. Explain the rationale behind pay bands so they feel fair and objective.  The dividends here will blow your mind as they pay you back in spades with employee loyalty.  Be honest about how and why decisions get made.

Customize as needed – While market rate should anchor decisions, customizing for specialized skills and credentials retains your unicorns.

Compensation only becomes a retention problem when handled reactively or arbitrarily. That is most of the companies we see!  A proactive focus on fair market pay based on analytics keeps valued talent invested in growing with your organization.

Fair pay tactics include:

• Regularly benchmarking pay against industry standards
• Adjusting compensation to meet changing market rates
• Rewarding performance and results through bonuses
• Providing clear promotion paths with pay increases
• Ensuring pay parity internally for similar roles
• Offering incentives like signing bonuses or stock options
• Conducting salary audits to ensure equity across demographics
• Transparently communicating compensation philosophy

Employees want pay transparency and equality around how pay decisions get made. They also want earnings potential through growth. Competitive compensation demonstrates value and fairness.

In my nearly thirty years in human resources and consulting, I have seen both sides of the debate proven true.  Many times, employees care much more about culture, or benefits, or challenge and opportunity.  My experience though, is that the large majority of cases come down to how much an employee takes home in their paycheck.

Table Of Contents

Article Home – Our Ultimate Guide To Reduce Employee Turnover and Increase Retention

TOC – Visit our Table of Contents Page for this engaging and dynamic series of informative articles about Employee Turnover compiled by our expert human resource consultants.

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Employee Onboarding is Your Best First Step to Stop Turnover

Effective onboarding boosts new hire productivity, confidence, connection and satisfaction. This leads to improved retention. The most successful companies onboard over months, not days. Ongoing checkpoints and training help cement roles and where available, assigning a well matched peer mentor creates connection and relationship.

Employee Onboarding Is Much More Than An Administrative Process

An excellent onboarding process is much more than paperwork – it’s an immersive cultural experience that pays dividends in talent retention.

On their first day, new employees are hungry to understand the company vision and values. New hires want to learn critical systems and processes.  They may not know it, but they want to get to know their teammates and find their new work friends.

Newly hired employees want to know everything they don’t know yet about your company – the insider knowledge that expedites them getting up to speed. This thirst for information should be welcomed!

Sink or Swim Onboarding Equals Future Turnover

Yet too often, new hires are drowned in documents their first week and left to sink or swim. Without structured onboarding, they feel disconnected from the organizational culture and uncertain in their roles.

Onboarding Is An Investment In Lowering Employee Turnover

The companies we see prosper the most invest in onboarding processes spanning multiple phases. Tactics like assigning peer mentors, scheduling regular check-ins, and providing ongoing training past orientation set new hires up to truly thrive. In this environment, little frustrations get resolved before they become dealbreakers.

The numbers speak for themselves – structured onboarding programs have been proven to boost new hire retention by over 80%⁵. When employees feel valued from day one, they are far less likely to jump ship at the first better offer.

Of course, onboarding is just the beginning. Sustaining a culture of learning and inclusion takes conscious effort. But proper onboarding gets new hires invested in the company vision. They become more loyal to leadership and peers who help them succeed in those critical early days.

The time and resources to onboard well pay dividends through higher productivity, fulfillment, and retention.

Good onboarding that extends beyond orientation paperwork incorporates:

• Sharing the company vision, values and culture
• Introducing new hires to key team members and leaders
• Providing training on systems, tools and processes
• Setting clear expectations and performance standards
• Assigning a mentor for ongoing support and guidance
• Checking in regularly on progress and satisfaction
• Soliciting feedback to improve the experience

Comprehensive onboarding processes are critical for reducing turnover rates.

The data clearly shows that employees who go through structured onboarding that focuses on cultural assimilation, role clarity, and networking end up staying at companies longer than those who receive minimal onboarding. This makes sense – onboarding sets the foundation for integration into the company and engagement with one’s role. Employees who feel welcomed, prepared, and connected from day one have fewer reasons over time to want to leave.

With the high costs of continuously recruiting and training new employees, investments into onboarding infrastructure and training quickly pay for themselves through that increased retention.

Enable new hires to envision a future with the organization. For any business looking to decrease turnover, the key is not just attracting talent but setting that talent up for success from the start through onboarding.

In our next post we look at how job market trends can affect turnover rates and what you should do to keep up with the market.

Up NEXT -> Offer Pay that Keeps Up with the Market to Avoid Bad Turnover

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Article Home – Our Ultimate Guide To Reduce Employee Turnover and Increase Retention

TOC – Visit our Table of Contents Page for this engaging and dynamic series of informative articles about Employee Turnover compiled by our expert human resource consultants.

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Hiring the wrong person results in turnover from the outset.

When HR is doing its job, the right people get sat in the right seats.  Recruiting gets done everyday all around the world.  The problem is that it is done poorly 50% of the time and another 30% is just getting it done without any significant skill, analysis or thought. 

Interviews alone are statistically the worst method of selection. 

More scientific methods require more time and higher costs.  That, and the sheer ‘that’s how everybody always does it’ carelessness create an endless crapshoot of turnover.  Will they or won’t they?  It comes down to hope and/or luck in many cases. 

It is very difficult to find recruiters who are more psychoanalyst than paper pusher. 

Most are in It for the commission or the pursuit of hitting their quotas.  Only a very few are trained in the fine art of uncovering motives or more importantly, genuine personality assessment and culture fit.  It takes either innate or finely-tuned soft skills to be able to use conversation to draw out a realistic preview of performance indicators.  Good recruiters spot inconsistencies, dive deep on important cues, and read non-verbals like a CIA interrogator. 

There are tools that help to find the right people for your organization.

The more scientific they are, the more accurate…and the more expensive.  Personality inventories, skills tests, and predictive indexes have been proven with scientific methods. They need to be, because any pre-employment test that hasn’t been proven to be reliable, consistent, and non-discriminatory almost always lead to a lawsuit. 

So don’t think about creating your own hurdle instrument to hiring unless you plan to spend tens of thousands for studies into their validity for that exact, specific job.  We recommend using good ones when it makes sense and has a good track record.    

Do The Reference Checking

At the least, you should be doing real background checks and reference checks.  Demand work related references and wherever possible, actual supervisors of that person. 

Interview Techniques Matter

Another foundational practice is to use behavioral interviewing.  That means asking open ended questions based on real life scenarios and experiential answers.  Questions in this category draw from their work history and soundlike: ‘Tell me about a time when you had to seal with a [fill in the blank].  How di you handle it and what was the outcome?’

Other best practices in recruitment include:

• Developing a clear job description and candidate profile of must-have qualifications, skills and competencies
• Using multiple methods to source candidates beyond the job ad (e.g. networking, referrals, headhunters, social media outreach)
• Screening for culture fit as well as technical abilities
• Using structured behavioral interviewing focused on competencies and past behaviors, not just credentials
• Incorporating assessments, simulations, skills testing, and portfolio reviews to evaluate talents beyond the interview
• Completing comprehensive reference and background checks
• Extending offers strategically with competitive compensation and sell points on growth
• Setting new hires up for success with prompt acceptance, signing, space/tools and team introductions

Hiring right avoids turnover down the road. Rushing to fill roles leads to problems. Skills can be taught but integrity, work ethic, positivity and core competencies predict performance. Seek candidates already aligned with the culture versus trying to force fit.

Once you select and hire the right person, you need to start the honeymoon, or as you may have heard it called: employee onboarding.

In our next post, we will discuss how to structure an onboarding program that creates loyalty and lowers employee turnover.

Up NEXT -> Get Onboarding Right and Employee Turnover Will Reduce Itself

Table Of Contents

Article Home – Our Ultimate Guide To Reduce Employee Turnover and Increase Retention

TOC – Visit our Table of Contents Page for this engaging and dynamic series of informative articles about Employee Turnover compiled by our expert human resource consultants.

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Listen up, managers. We need to have a heart-to-heart about why employees really resign.

The harsh truth is, we often misread the reasons people quit. It’s natural to assume they’re leaving for more money or chasing lofty personal goals. But those assumptions miss the mark.

Want people to stick around? Take a hard look in the mirror. Because our own practices as leaders – the culture we create, the way we communicate, the workloads we assign – drive voluntary turnover more than we’d like to admit.

Trust me, I’ve been there too. It’s easy to point fingers outward when someone resigns rather than asking “What could I have done better here?” But getting defensive leads to a cycle of more people heading for the exit doors.

We as managers and business owners don’t really want to face the facts.  We fall back on the old standards like:

They just wanted more money; or

They wanted a shorter commute

Or we make up reasons for the employee like:

They are lazy; or

They aren’t a fit for our culture; and

I was probably going to fire them anyway.

And of course, there are the workplace ol’ wives’ tales, like: 

Employees these days are just not loyal; or

That employee “doesn’t get it.”

So where do we go wrong? The data shows a big disconnect between why employers THINK people leave versus the actual reasons:

• Lack of trust in leadership,
• poor work-life balance, and
• unhealthy culture rank high in reality.

Ouch. That stings to hear. But we can’t improve retention until we confront our own blind spots head on.

The more we reflect on our real culture versus the one we aspire to, the better we can support our team. That starts with looking within first. I know together we can become the kind of leaders that inspire loyalty for the long haul.

Many employers attribute employee turnover to generational differences – believing younger workers lack loyalty and job hop more frequently. They assume people leave primarily for more money or for entirely personal reasons unrelated to the job. While competitive pay is important, these assumptions miss the mark on the true driving factors behind turnover that are often within an organization’s control. Listening to employees and taking proactive retention measures provide the true solutions.

Find out the real reasons your employees are leaving in the next post…

Up NEXT -> The Real Reasons Employees Actually Leave

Table Of Contents

Article Home – Our Ultimate Guide To Reduce Employee Turnover and Increase Retention

TOC – Visit our Table of Contents Page for this engaging and dynamic series of informative articles about Employee Turnover compiled by our expert human resource consultants.

Sources

The sources and end notes for the main article, this article, and all of the sub-pages is listed below.  All information is used under the Fair-Use.

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