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One day workshop for the HR team and departmental heads employed by a distribution business based in Manchester, seeking to reduce staff turnover rates.
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Reducing attrition rates
by Fluid
September 2010
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Contents3-4 Introduction to Fluid5-6 True cost of attrition7-8 Increase in organisational
performance9-10 A strategy for retention11-16 Why are you going?17-18 Managing the loss of a
‘constant’19-20 Handling a senior resignation21-22 Exercise A23-25 Quiz26-29 Retention initiatives30-31 Real-life example32-33 Job dissatisfaction34-35 Dispelling the myths-why
workers actually leave 36-37 Turnover rates by occupation38-42 What’s a reasonable turnover
rate for voluntary leavers?43-45 Diving after those that jump ship46-47 Motivation48-49 Keep outgoing employees happy50-51 Exercise B52-53 Case studies54-55 Conclusion and questions
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Introduction
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Introduction to Fluid• Fluid Consulting Limited (Fluid) is a specialist
human resources consultancy headed by Tim Holden MCIPD
• 10 years in banking• 10 years in Human Resources consultancy• Fluid trading since 2006• The core services provided by Fluid are:
- Retention- Selection- Attraction- Remuneration & Reward - Outplacement- Training & HR consultancy
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True cost of attrition
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True cost of attrition
• Wastage index or standard formula• Resignation rate• Stability rate• Survival rate
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Increase in organisational performance
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Increase in organisational performance
• Reduce unnecessary recruitment costs• Raise levels of morale and motivation• Improve performance of existing
employees
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A strategy for retention
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A strategy for retention
• Diagnosing the drivers behind voluntary turnover
• Making decision on how to combat these various factors
• Implementing targeted initiatives
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Why are you going?
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Why are you going? 1 of 5• KEY REASONS FOR EMPLOYEE TURNOVER• Change of career• Promotion outside the organisation• Level of pay• Lack of development or career opportunities• Leaving to have/look after children• Redundancy• Retirement• Level of workload• Stress of job/role• Lack of support from line managers• Number of working hours
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Why are you going? 2 of 5• Lack of promotion opportunities• Inadequate pay• Poor relationship with supervisor/manager• Poor work-life balance• Lack of independence in carrying out the job• Lack of belief in the purpose of the organisation• Lack of confidence in the future of the organisation• Uncomfortable working conditions• Lack of training/developmental opportunities• Promises not kept by management• Uninteresting work/boredom• Lack of teamwork/cooperation
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Why are you going? 3 of 5• REAL LEAVERS• Lack of teamwork/cooperation• Uninteresting work/boredom• Promises not kept by management
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Why are you going? 4 of 5• HR RESPONDENTS• Lack of promotion opportunities• Inadequate pay• Poor relationship with supervisor/manager
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Why are you going? 5 of 5• EXIT INTERVIEWS• When and with whom?• Third party involvement• Six months after leaving• What is done with the data?
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Managing the loss of a ‘constant’
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Managing the loss of a ‘constant’
• Put succession plans in place• Offer stability, control and support during
change• Communicate early, consistently and
clearly• Develop a culture of learning• Thank your employees and acknowledge
their effort
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Handling a senior resignation
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Handling a senior resignation
• Find out why they resigned• Never be caught unawares• Have a succession plan• Look out for external talent• Benchmark the package you offer their
successor
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Exercise A
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Exercise A
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Quiz
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Quiz 1 of 2
• 1. The majority of people leave their manager, not the organisation-TRUE or FALSE
• 2. What % of leavers go due to dissatisfaction with the job and/or the organisation?
• 3. Significantly more women leave organisations due to harassment or bullying-TRUE or FALSE
• 4. Upon resigning, for how long has the average leaver been thinking of going?
• 5. Which of the following occupational groups are more likely to leave for a more competitive salary elsewhere-salespeople, blue-collar workers, IT techies or professionals?
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Quiz 2 of 2
• 6. When asked, what do most employees think is the most important factor for maintaining their commitment to an organisation?
• 7. When leavers to new jobs are asked how their new package will compare, what % is the most common response?
• 8. Which reason are leavers more likely to select when the survey is not anonymous?
• 9. Which is the most common reason given by those leaving within six months than by more established employees?
• 10. Leavers from which white-collar group express the highest level of dissatisfaction in respect of their work-life balance?
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Retention initiatives
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Retention initiatives 1 of 3
• Increased pay• Increased learning and development
opportunities• Improved selection techniques• Improved induction process• Improved line management HR skills• Improved benefits• Made changes to improve work-life balance• Improved employee involvement• Removed age-related policies and practices
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Retention initiatives 2 of 3
• Offered coaching/mentoring/buddy systems• Revised the way people are rewarded so their
efforts are better recognised• Made changes in way the organisation
approaches career management• Offered secondments• Better promotion to employees of the employer
brand• Redesigned jobs to make them more satisfying• Better publicised levels of pay and conditions• Improved physical working conditions
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Retention initiatives 3 of 3
• Flexible working• Green and corporate social responsibility• Health & wellbeing• Learning & development• Pay• Sabbaticals
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Real-life example
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Real-life example
• Communication is key during an integration process so it is crucial to gain buy-in through partnership working and widespread consultation
• Make people part of the decision-making process-let them make their own decisions about where they want to work
• Don’t underestimate the importance of facilities such as car parking
• Ensure that you allow enough time for site orientation-it is essential that employees get to feel familiar with the new surroundings
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Job dissatisfaction
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Job dissatisfaction
• FINANCIAL SERVICES, PROFESSIONAL SERVICES, PUBLIC SERVICES, RETAIL, TECHNOLOGY/MEDIA/TELECOMS
• I regret my career choice• The sector I want to move to is more stable• Progression is better in other sectors• % wishing to obtain a job in another sector• Most popular sectors for those who wish to change• How dissatisfied are you in your job?• Are you working harder?• I worry I’ll be made redundant• I worry my skillset is out of date• The recession has made me rethink my career
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Dispelling the myths-why workers actually
leave
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Dispelling the myths-why workers actually leave
• Diagnose• Address• Define
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Turnover rates by occupation
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Turnover rates by occupation
• Administrative, secretarial and technical 13%
• Managers/professionals14%
• Manual/craft workers 12%
• Services( customer, personal, productive& sales) 16%
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What’s a reasonable turnover rate for
voluntary leavers?
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What’s a reasonable turnover rate for voluntary leavers 1 of 4 ?
• MANUFACTURING AND PRODUCTION• Agriculture and forestry
20%• Chemicals, pharmaceuticals and oil
8%• Construction 10%• Electricity, gas & water
5%• Engineering, electronics and metals
7%• Food, drink and tobacco
17%• Manufacturing
9%• Paper and printing
7%• Textiles
7%
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What’s a reasonable turnover rate for voluntary leavers 2 of 4 ?
• PRIVATE SECTOR SERVICES• Call centres
16%• Communications
13%• Finance, insurance and real estate
12%• Hotels, catering and leisure
30%• IT services
17%• Media 17%• Retail and wholesale
19%• Professional services
12%• Transport, distribution and storage
6%
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What’s a reasonable turnover rate for voluntary leavers 3 of 4 ?
• VOLUNTARY, COMMUNITY AND NOT-FOR-PROFIT
• Care services 17%• Charity services 13%• Housing associations
10%
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What’s a reasonable turnover rate for voluntary leavers 4 of 4 ?
• PUBLIC SERVICES• Central government 8%• Education 5%• Health 9%• Local government 11%
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Diving after those that jump ship
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Diving after those that jump ship 1 of 2
• RESTRICTIVE COVENANTS• Stenhouse case• Is the clause likely to make employees
refuse business they would otherwise take?
• Does the clause diminish employees’ employment prospects?
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Diving after those that jump ship 2 of 2
• Review the restrictions on senior employees and tailor the covenants to suit the person
• Distinguish confidential information• Be brave and take the strong cases further
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Motivation
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Motivation
• What sort of working environment and culture do you feel most motivates you?
• What are your key personal and career objectives and goals in the long and short term?
• How would you describe the meaning of success?• What form of reward most motivates you?• Explain a situation in the workplace where you
have motivated colleagues?• Do you think individual success is more rewarding
than team success?
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Keep outgoing employees happy
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Keep outgoing employees happy
• Be impartial• Be sensitive• Follow a process• Communicate• Don’t burn bridges
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Exercise B
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Exercise B
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Case studies
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Case studies
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Conclusion & Questions
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Conclusion
• Summary• Questions
