High turnover rates can cripple a business. It can stunt your growth, weaken your efficiency, and destroy your company culture.
Leaders suffering from cycle sometimes don’t understand the role that company culture is playing in the process.
If your company places more emphasis on other areas of business and ignores the rationale behind its hiring process, you might end up bringing on candidates who don’t mesh well with your organization. And this is a big deal in manufacturing, which saw a 1.2% spike in turnover in May 2015, which coincided with a months-long turnover increase compared to 2014.
But if your company culture invests in a hiring process that guarantees team members with strong character, talent, and ability, then the rate of turnover can be very low — even in the single digits.
Addressing your company culture isn’t easy, but it is necessary to keep turnover and its associated costs down. The key is rejecting these four big myths, often embedded in a company’s culture, that keep your turnover high:
- Turnover is a cost of doing business. Are you willing to fly on an airplane with an acceptable defect ratio of 20%? Of course you aren’t. So why would you tolerate a turnover rate of 20%? High turnover is not a normal state of business — don’t just accept it.
- A warm body is better than nobody. The challenge of tackling ongoing turnover can lead many companies to the placebo solution of hiring temporary workers. In the end, this only increases turnover and often creates more problems within an organization.
- The manager’s role is minimal. Gallup research has shown that a culture of bad leaders is the biggest cause of turnover. Leaders, overwhelmed by the demands of daily operations, often function below their pay grade and don’t address poor performers. This impacts the morale of good performers, who end up having to do more.
- It’s human resources’ fault — not mine. HR’s role in turnover resolution is likely the opposite of what many imagine. Your HR team can provide administrative support to solve turnover problems faster, including measuring, monitoring, and championing the efforts of the leaders — who are ultimately responsible for turnover.
Leaders who believe these myths will cause their organizations to lose both money and morale. Instead of continuing with a hiring process that doesn’t work or perpetuating a company culture that accepts turnover, work to improve inherent problems to keep turnover down.
Contrary to conventional wisdom, turnover doesn’t have to be part of your business plan.
When you work to fine-tune your company culture by removing flawed or misguided processes, employee satisfaction increases — and this is the most direct route to reducing turnover.
Read the full article with tips to overcome these obstacles on IndustryWeek.