Whether you are in good times or bad, managing people is one of the biggest challenges any business owner faces. What costs your business the most is getting the most from your team. Recruiting, hiring, and then retaining people who can be long term contributors isn’t an easy task to pull off under any market conditions, let alone now.
Employees quit jobs for many reasons. Management fires them for various reasons, but one thing is for sure, employee turnover has a real cost to the business and the employees who are still in place.
Critical Factors About the Real Cost of Losing an Employee
First, as a matter of practice, create a system to measure your employee turnover costs so you can assign a financial consequence. Through measuring, you’ll learn to make better decisions in hiring and coaching employees because you know the real costs.
The costs to create and place an ad usually is not factored into this equation. Your advertising, interviewing, and screening time can be easily measured.
The costs of onboarding the new employee include orientation and training time. Any time to design this process should also be included. Existing employees who are utilized for onboarding or training are temporarily out of touch with their job functions while meeting or working with a new employee. There are missed productivity costs to consider, as well.
Depending on the role’s complexity, the new hire could take six months to two years to get to a current employee level. A business can invest 10 to 20% of the employee’s salary or more in training.
The cultural impact on employees who witness turnover often creates more questions that require management time to process. The rumor mill gets fed. Both of these articles address key elements to improve the culture of your business.
An Exercise to Uncover How to Deal with Questionable Employee Productivity
One of the first pieces to the puzzle is to make sure you have the right person in the correct position. If someone isn’t performing well in the role, do they have the knowledge, skills, and attitudes? If not, how can you help them?
Review the job description and make sure it’s on track. Outline the knowledge and skills it takes to perform at a high level. Break these out into 3-5 areas to make it easier to narrow down specific areas that need attention. Rank the person’s behaviors in each area with a simple 1 to 6 rating. One being the best and six being the lowest. This starts to show where specific areas need improvement.
Consider the best tools and resources to help this person improve. It could be internal or external training or even a combination of these. This could consist of mentoring or shadowing an employee who displays the proper behaviors. The key is to create an environment to learn.
With the ranking scale exercise complete, you now have a game plan to implement the solutions. You want to measure throughout the process to make sure the outcome matches the expectations.
Knowledge and Skills Can Be Improved
Usually, someone in your organization has the working knowledge for this issue. Create meetings to cross-train. Make sure the transfer of that specific knowledge is what you want to accomplish. If this is a new process for your team, set time parameters for these meetings so they don’t run on forever. Even using an agenda makes it easier to measure progress.
Attitude Is A Challenge to Improve- Finding the Root Cause
So, they know what to do. That’s the knowledge part. And they know how to do it. That’s the skill part. Do they have the right attitude? This is one of the most challenging performance issues to address.
Did they have a good attitude at one time? What changed? See if you can pinpoint what and when it changed. Many times, an employee will have a negative experience but not say anything. When you find the root cause of their uneasiness, you’re able to find a workable solution more often than not. Many times, just having the conversation reveals the issue and soothes the wounds.
Personal Problems Contribute to Attitude Changes
A goal as a leader isn’t to be a baby sitter; however, you have to know your people. Frequent coaching sessions can reveal personal problems. Maybe some time off or suggesting counseling would help. If they are a valued employee, you want to find creative solutions to help your employee get back on track. A happy employee delivers better customer service than an unhappy one. Imagine that.
Getting the most from employees is easier when you have a culture that builds employee morale and teamwork. Coaching and developing talented people can be a rewarding journey.