An article in the Gallup Management Journal indicates that while about 50% of people leave for better pay or career advancement 37% left either because of bad management or a lack of job fit. That means over one third of your turnover is probably preventable.
What is the big deal?
“The U.S. Bureau of Labor Statistics has found that the U.S. voluntary turnover rate is 23.4% annually. It’s generally estimated that replacing an employee costs a business one-half to five times that employee’s annual salary. So, if 25% of a business’ workforce leaves and the average pay is $35,000, it could cost a 100-person firm between $438,000 and $4 million a year to replace employees.” — Gallup Management Journal
How can I fix it?
First things first, if people are leaving because of poor management you need to invest in your managers. Send your managers to training, lead by example, and make sure when you promote or hire a new manager they have an experienced mentor they can learn from.
Once you have your management team in order take a look at employee satisfaction. There are lots of ways to gauge satisfaction, just make sure you are doing it frequently. So far the best process I have read about is a company that measures morale on a daily basis using red, yellow, and green marbles.
Make sure you understand your corporate culture and the culture of specific teams and departments within your organization. Make sure the new people you hire understand your culture and will fit in with the work and management styles of their coworkers. Use behavioral and cultural assessments to avoid personality conflicts between managers and employees.
I’m willing to bet if you implement these strategies you can lower your turnover and start being more productive within the first 3 months.