Employee Turnover
Is your track record for turnover a problem. When I talk with execs they inevitably talk about efforts to reduce turnover. Some have made amazing strides. But it’s still common to see turnover rates hovering higher than 200 percent.
Think about this. In a store with 40 employees and a $1,750 replacement cost for each lost crew member (the average of rates I’ve heard across many such discussions), that represents $140,000 in costs. A beleaguered franchisee with a 10 percent profit on sales would have to do $1.4 million in sales just to absorb this cost!
The sad truth, though, is turnover is not an easily solved problem. There are dozens of reasons people leave: bad on-boarding experiences; aloof coworkers; bad managers; rude customers; poor advancement opportunities; too few hours; too many hours.
Managers wear many hats. First, they have the difficult job of being a translator. Those at the leadership level, have the big picture in front of them. They're looking around at the forests and looking out at the horizon. After deciding the best direction for the company, they set goals and communicate those goals to the managers.
Managers must not only be able to interpret those goals accurately, they must be able to translate them and dice them up into specific action-items for the front line employees working among the trees in the forest.
That's not always an easy job. Many leaders forget what it's like to work among the trees. And, most front-line employees have not been up in the top leadership position. Still, managers must correctly interpret the vision told them by those in leadership, translate it into manageable pieces, and delegate tasks accordingly.
To make their job even more challenging, many managers remain responsible for large amounts of non-managerial work. Recent research by a Leadership Group has found that some managers spend as much as 85 percent of their time doing production work. Clearly, this does not allow them to be effective in their managerial role.
Perhaps the worst dilemma for managers is getting placed in a supervisory role without any training for how to do it well. For some reason, the idea persists that front line employees who excel can be placed in management or supervisory positions and they will do equally well.
That's rarely the case without help.
People placed in management roles must become translators, delegators, motivators, trainers, mediators, planners, listeners, organizers, problem-solvers, example-setters, cheerleaders, budgeters, ambassadors, regulators, counselors, and more, all while remaining diligent workers.
With little-to-no training for these responsibilities, it's next to impossible for new managers to succeed. This is why even after five years, fewer than a quarter of people promoted to supervisor or manager positions have successfully transitioned into the role.
What's more, the Leadership Group says in the past three years, that proportion has gotten even worse. They found that between 2005 and 2008, the percentage of people who have successfully transitioned to management positions dropped from 25 percent to just 16 percent.
So here's a suggestion: Put ongoing training in place. A one-day class will not cut it. For that matter, a one week class will not cut it. Ongoing, intermittent, management training with feedback and coaching, gives managers a way to learn, practice, and improve their efficiency and effectiveness as they progress.
Afraid of the cost? I've heard way too many business owners express concerns that they'll pay for someone to become a better manager and then that person will leave. But a Chief Financial Officer of a major regional bank has a great perspective to counter that concern. He once told me, "what's the cost of not investing in them - and having them stay?"
Consider what happened to Teri. She had a long history of success in her tech position at an aerospace technology firm. Shortly after her promotion to supervisor, she attended a highly-regarded two-week management training class. Just like in her technical position, she excelled in the training class and received high marks from the instructor.
Unfortunately, not long after returning to work Teri began criticizing and nitpicking her staff for minor issues. She was unable to separate real issues from trivial matters. She wrote people up for small infractions, she acted indifferently to employee concerns, and didn't spend much time in training, planning, or organizing. Much of her days were spent going over each team member's work with a fine tooth comb, sending projects back for correction.
Within seven months, five people from her team had requested transfers, and two simply found work elsewhere and quit. The staff that remained had lost all respect for her. Although complaints had been filed, neither HR nor Teri's immediate supervisor did any counseling, coaching, or mentoring with her. After a year, senior management decided Teri wasn't cutting it and fired her.
This was patently unfair to Teri, and it's certainly not the way to help your organization succeed. As I indicated up front, if you're not willing to do what it takes to equip a person for a job you promote them into, you're asking for trouble.
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