How to reduce employee turnover and increase morale and productivity
High employee turnover undoubtedly hurts a company’s morale and bottom line. It’s reported that 22% of turnover occurs in the first forty-five days of employment. There are significant costs related to employee turnover—interviewing, selection and new employee on-boarding processes—all which require a large investment of resources. Aside from these costs, productivity will suffer and continue to suffer until employment gaps are filled and new employees are performing at the required rate of production.
While turnover can be broken down into two groups, involuntary and voluntary, businesses have no control of involuntary turnover like retirements, firings and unforeseen events. However, there are several things that can be done to reduce the rate of voluntary turnover that will keep keep production levels up and eliminate the need of additional resource investment.
Do
- revisit your hiring and onboarding processes
- recognize and reward quality performance
- open channels for communication
- address negative influences
Don't
- focus solely on incentives
- hire out of desperation
- improperly place workers
- exhaust workers
Do revisit your hiring and onboarding processes
Low employee turnover begins with the hiring process and continues into the onboarding phase of new employment. It is critical to interview, review and train candidates carefully. This isn’t just about finding out if they have the right skills for the job or training them to reach production levels. It’s also about understanding then confirming their fit into the company’s culture and employment pool. Having the right skills might allow them to get the job done, but without proper alignment with the company’s atmosphere, it can lead to issues down the road that end with voluntary turnover.
Do recognize and reward quality performance
Recognizing and rewarding quality performance is an incredible way to not just reduce employee turnover but also increase company morale. Keep in mind that high performing employees can be rewarded with both tangible and intangible rewards that align with their specific needs and wants. By publicly rewarding high-performing employees, it will encourage all your employees to work harder and increase their production levels.
Do open channels for communication
Managers and high level executives spend a lot of time instructing and delegating their employees. However, you must ensure that the lines of communication are open for your employees to share their experiences, as they have valuable insight into the workings of your business. After receiving useful information, implement them if applicable and be sure to give credit where it is due. When you take time to develop relationships with your employees, while keeping boundaries, you will find that they are less likely to quit and stay where they are valued.
Do address negative influences
While high pressure situations tend to make workers edgy from time to time, ongoing negativity in the workforce can cause an increase in turnover. Addressing negativity head on will not only prevent a turnover surge, but prevent possible violence and poor morale in the workplace. Start by performing a cause analysis to find the root of the negativity while steering clear of taking actions on assumptions. Once you have the data you need, develop an action plan and include multiple departments to ensure transparency if/when changes are made.
This will strengthen your solution in the eyes of your organization by fully communicating any shifts that are coming down the pipeline.
Do not focus solely on incentives
Incentives must be in tandem with other performance practices at your facility. Simply rewarding the meet/exceeding of production levels isn’t sustainable and will send the wrong message to your workforce. Ensure you have a well rounded strategy to recognizing and rewarding quality work that doesn’t just include tangible or intangible incentives.
Do not hire out of desperation
Knee jerk reactions when hiring often lead to job skill mismatches or relatively quick turnover due to rushing or expediting the hiring process. Your hiring and onboarding process is put in place so you can find the right person for the job who will has the skill to operate at peak efficiency and will fit in well at your business. It is understandable to want to find someone quick when your production levels are low, however this action will end up costing you more in the long run.
Do not improperly place workers
When production or your business is suffering, overtime opportunities often present themselves. However, when workers who are unqualified or have little knowledge about the job, it will cause not just an issue for your business but possibly with the worker who is filling the position. If their performance isn’t optimal, frustration from managerial feedback can discourage the employee and make them feel disconnected with their job. In addition, other workers can recognize instability in the workforce and seek employment elsewhere. Make sure that when you place workers in sinkholes that need to be filled, they can handle the job both emotionally and skillfully.
Do not exhaust workers
While production levels need to remain high, exceeding the limit of what employees are expected to maintain long term is not recommended. The short term results might yield a boost in production, but the long term effects can be potential health problems, mental instability, disruptions in personal relationships and ultimately an increase in turnover. Be sure to properly vet candidates during the recruiting phase—which helps gain an understanding of their skill level—and stick with your initial findings when creating their workload schedule. Remember, increasing production levels might be needed from time to time, but exhausting your workers will lead to far greater issues than low production numbers.
Summary
Regardless of your tactic when reducing employee turnover, there will always be a small percentage. While involuntary turnover can not be controlled, you will find employees leave because they are dissatisfied, disengaged or find a new opportunity. By following these simple do’s and don'ts, you can help minimize the voluntary employee turnover at your business, while at the same time increasing morale and productivity.
