Employee turnover is not the end of the world because it can provide the organization with an opportunity to refresh the talent pool, retune salaries, and replace old skill sets with newer ones. However, employee turnover does need to be monitored and managed.

Gordon Gekko was close when he said “Greed is good”. Just replace a few words … “Change can be good.”

According to the experts, employees tend to leave either within the first few months of hire – the “honeymoon” stage – or after a few years when they are ready to pursue the next step in their career. If they stay much longer, they tend to settle into their comfort zone.

Based on the aforementioned stages of employee turnover, your organization has an opportunity to make some changes. If an employee leaves within the first few months, it may be because you’ve made a bad hire or there are internal problems within that department, such as a poor manager. If they leave within the first few years, it may be because they need a bigger challenge.

The upside is that you have the power to change this. First, you can reduce employee turnover by reviewing your recruitment and hiring practices to determine if what you’re doing and how you’re doing it is netting you not just the candidate with the best skills, but the one that best fits your organizational dynamic.

Next, once you’ve brought the new hire on board, ensure that she becomes properly acclimated to the organization and receives the right training and tools to be successful in her job.

Finally, to reduce employee turnover during the honeymoon period, take time to train your managers for their important role. Too often, the employees who are promoted are either the ones that have been with the company the longest or have the best interpersonal skills. Neither of these traits necessarily makes them management material.

On the other hand, employee turnover that occurs after employees have been with an organization for a few years (generally five or less) is more likely to occur because an employee is ready to branch out and doesn’t see their current employer as being the optimum place for doing that.

Therefore to reduce the likelihood of this occurring, organizations need to develop programs that provide for the continuing development of current employees. Well, for most employees.

Unfortunately, the truth is that even though recruitment and training can be expensive, a workforce filled with worn-out managers and apathetic employees can be equally costly. That’s why the final upside of employee turnover is the opportunity to refresh the talent pool by hiring individuals with newer skills sets and often at reduced salaries.

So while you should work to minimize employee turnover, consider who is staying and who is leaving and what the overall impact will be on your organization while taking the opportunity to improve your team’s skills sets by refreshing the talent pool.

This entry was posted on Monday, October 30th, 2006 at 9:28 am and is filed under Employee Retention, Training, Organizational Change, Employee Turnover. You can subscribe via RSS 2.0 feed to this post's comments. You can comment below, or link to this permanent URL from your own site. Your comments will appear immediately, but I reserve the right to delete innapropriate comments.