Employee turnover, in its simplest form, refers to the number of employees that leave you business and have to be replaced, in a given period of time.
For a small business this could happen even if you have just 1 or 2 employees.
Consider this in light of the popular claim that people don't leave bad businesses, they leave bad bosses.
And in your small business, chances are, you are the owner as well as the boss.
Only recently, I was acutely reminded that bosses are rebuked, scolded, screamed at, chastised and even cursed out about how they treat their employees.
On the the other hand, it seems as though everyone forgets that, after all, you are the ones who take the frightening business risks. You are the ones who take the dreaded “overdrawn” calls from the bank and you are the ones who figure out how to make payroll, month after month.
In having to balance these 2 equally important aspect of your business, somehow, the HR Management is neglected and you experience a rate of employee turnover that's frustrating at best.
But this coin like any other good coin, has two sides to it.
Employers are not always the sinners they are made out to be and neither are employees the saints they believe they are.
The problem is, you are not capable of articulating your needs and concerns effectively, and when those needs are not met, you fire people fast...too fast. Hence the high employee turnover.
So what I want to do in this post, is to use the 8 most popular problems I come across that lead to employee turnover and show you 8 ways to fix them. The solutions are workable but you will have to build the confidence and spend the time to implement them.
So if you're ready, here they are...
1. Have A Hiring Process
Do you hear me? Do you understand me?
I really have to stress this because I am appalled at how many of you just seem to hire the first person that turns up in your face.
When you do not have a hiring process, hiring is a hit or miss and as to be expected, employee turnover will be high.
So how can you establish a hiring process?
Well, in this post I lay it out for you. It's important that you read this post. You see, the hiring process is very important to reducing your frustration with employees who do not fit in with your business culture.
2. Show your employees how to value your time
There are many ways in which your employees waste your time. But the one which really annoys you is how they approach you when they want to discuss issues with you.
For the most part, they are often unprepared in very basic ways, having done little or no research and are unable to answer very obvious questions.
As you sit in these "meetings" your primary thoughts are on the best way to fire them without getting in trouble with the law, for wasting your time. But hold on...here is a better approach.
Develop " before, during and after" guidelines for attending meetings with you and share them with your staff. Also let them know what the consequences are for following, and not following, those guidelines.
In addition, remind your team that effective communication does not only happen at your end, it must happen at theirs as well and that your time is as equally valuable as theirs.
When you take charge of this process, you will find that eventually, your employees will understand that your time is valuable and treat it as such.
In this way, you will reduce your need to deal with your frustrations by firing and this will reduce the rate of employee turnover in your business.
3. Set up a system for staff decision-making
One of the biggest complaints I usually get from clients, colleagues and friends goes something like this:
"Lorna, these people that work for me are driving me crazy! they come to me for answers to the most simple problems! Can't they even think? I feel like firing the whole damn lot of them!"
A question for you...Will you believe me if I told you that this is your fault?
Let me show you what I mean by telling you a little story.
About 6 year ago, I bought a gym and decided to keep the existing employees. Talk about the team you inherited...
In 5 short months, I had molded what everyone told me was a group of misfits, into a dream team (I talk about that here) that I was really proud of.
How did I do this?
I established a simple system for making decisions. Let me tell you up-front, it was not easy.
It went something like this: If a problem comes up on your shift that you know how to solve, solve it. If you can't, think of a solution before you come to me, and share it with me before you ask for mine.
This was responsible for a tremendous increase in their willingness to take initiative and risks. It also increased their self-confidence and self-esteem as well as their productivity and freed me to make bigger strategic decisions.
Before you rush off to implement any system though, there's something that you need to put in place.
You need to make sure that you have the confidence to create a "space" in which your staff feels safe to make decisions. This means that the "space" must be built on support and guidance as opposed to punishment. In other words, your staff must be comfortable that a "bad" decision will not result in punishment.
Having such a system in place will not only reduce your employee turnover but will develop their skills and confidence as well.
4. Don't knowingly tolerate lies from your employees
One of the things that you bosses laugh at when you are hanging out together, is the fact that your staff think that you're foolish. As a matter of fact, they actually believe you can't spot a lie.
Instead of laughing and then firing them when you've had enough, you should reduce employee turnover in your business by NOT tolerating obvious lies.
Let them know that you spot the gaps and even the little alley ways in their "stories" even as you give them the benefit of the doubt.
They should know that you really CAN connect the dots between how many aunts they had at the beginning of their employment, and how many funerals they have to attend 6 months later, due to the death of aunts.
So call them out on these lies. Get clear on the behaviour you will and will not tolerate and share it with them.
To reduce the need for these petty lies from your staff, one of the things I advise my clients to do, is to make 1 or 2 personal days per year, available to each employee. The only limitations that should be placed on accessing these is having to work for a specified period (I usually recommend a year) and a specific request must be made in advance.
This is only one form of employee rewards that slows the rate at which your employees leave and it also establishes you as a good employer to work for.
5. Choose policies and procedures over "mind reading"
Yes, you know that an employee is studying.
Yes, you know when their exams are.
What you did not know is that they would want their vacation, some study leave, any outstanding lunch breaks and any other leave imaginable, just before their exams.
So, they request such leave one week before they need it, and then tell you “you should know I would have wanted it!”
Tolerating this behaviour sets you in the role of "mind reader" instead of "fearless leader."
In addition, it upsets the rest of the team, disrupts the smooth running of your business and annoys the pants off you. And should you refuse, the employee will believe you're bad-minded.
Worse than this, it tells me that you are lacking the required policies and procedures that would prevent these situations from happening.
If this is the case, you should put them in place as soon as possible. This would remove any confusion about how to handle these situations and help to make your small business a desirable place to work.
6. Stamp out "sucking up" to reduce employee turnover
Simply put, "sucking up" is when a particular employee tries to get in your good books by constantly complimenting you and attempting to do you favours.
While you understand that, and you're aware of it, what you do not quite understand is the impact this has on your business, especially the rate of employee turnover.
First of all, according to the Journal of Applied Psychology, this behaviour of sucking up to bosses takes energy employees could be using to do what you hired them to do.
Secondly, most of you are susceptible to this ingratiation and almost imperceptibly, you begin favouring this employee over the rest. Admittedly, some of you are suspicious of employees who behave like this but you don't quite know how to respond.
And if this is not enough, eventually, the ingratiators soon becomes a law unto themselves. Then both you and that employee lose the respect of the rest of the staff. Naturally, this impacts the cooperation and reduces productivity in your business. And your constant thought is "I feel like firing the whole lot of them!"
Instead of firing anybody, address the sucking up directly.
Simply thank the person for their compliments and favours but at the same time remind them of the things that would impress you even more. These could include punctuality, being more helpful to other colleagues, completing projects on time, etc.
In this way, you will keep every employee happy and retain them for a longer time.
7. Teach your staff how to keep you informed
You have decided to dismantle the tradition structures that you've operated with for a long time. You accept that you do not have all the answers and you want more input from your staff. Great!
So how did such a noble idea go so wrong? Why are you so unhappy with the information and how you are getting it? Can't these people ever get anything right?
When Business Owners complain to be about communication problems with their staff, this is almost always at the top of their list. But I usually have one question for them, "Did you give them any guidelines about how to keep you informed?"
The answers generally range from a thoughtful "not really" to a puzzled "no..."
I find that communication problems are one of the big sources of employee turnover in small businesses. It seems obvious then, that your goal should be to make sure your communication is as effective as it can be.
So here is a template you can use for how your staff should keep you informed:
1. Keep me informed regularly; I don’t like ad hoc approaches or surprises.
2. Don't leave out the bad points about any situation because they make you look bad. Give me all the facts and trust me to deal with them appropriately.
3. Give me at least two possible solutions for every problem. In this way I have choices and I am convinced that you are thinking.
4. Do your homework and groundwork before you come to me. I don't want you to have to go back and check on everything I query.
5. Remember I am asking for nothing more than you would want from your staff, when you're in my position!
If you give your staff even these few guidelines, the communication process becomes clearer and everyone is happier.
8. Encourage staff to take some responsibility for their own development
One of the things that employees appears most unhappy and disgruntled about, is an apparent reluctance by their employers to pay for their professional development.
You understand the need for employee development. After all, work as we know it is changing from the traditional “brains at the top” and “brawn at the bottom” approach. Employees, now need a much larger collection of skills than was previously the case.
What you do not understand is why you are expected to take full responsibility for this. Surely they know that you cannot afford this? And when they leave they take the training you pay for with them?
This issue has caused a lot of conflict between Small Business Owners and their employees, usually ending with the employees leaving in search of greener partners.
In order to address this matter effectively, as far as possible, try to partner with your staff on their professional development. When you think about of it, both of you stand to benefit from this approach. But you need to ensure that any programme of continuous professional develop (CPD) helps your employees to:
- Acquire “transferable” skills
- Update the range of their professional knowledge
- Increase career opportunities and flexibility
- Increase personal and business effectiveness and productivity
- Build self-confidence and self-esteem so they can take on more responsibility
- Increase your revenue and their income
- Experience life and business in a whole new way
When you take this approach, your employees are sure that you have their best interest at heart. So even if they leave eventually, it's on so much better terms.
Your next step in reducing employee turnover?
There you have them...8 unusual, affordable ways to reduce employee turnover.
Far too often, you are led to believe that you have to spend a ton of money and implement a series of complex policies to keep your worthwhile employees on the job. Now, you have some information that will help you to crystallize what you really want from your employees.
So go ahead, breathe out...and determine which of these approaches you can start implementing now.
If it's true that employees leave bad bosses, these 8 steps now give you the opportunity to be a boss they never want to leave...
You can do this...can’t you?