Excessive turnover in an organization is a prime indicator that something is not right in the employee environment. We will look at the differences between retention and turnover, why employees stay, reasons why they leave, and what can be done to save them. We will also examine some external factors that will make employee retention and turnover reduction highest priorities for human resource professionals. Basically, employee retention is measured by an employee's longevity with a company, and is the desired outcome of a company hiring workers it wants and needs. Many organizations find it more productive and profitable to redirect resources formerly allocated to recruiting, hiring, orienting, and training of new employees and use them instead toward employee retention programs.
In today’s competitive workforce, talent is not only incremental, but also scarce. War for talent, a term coined by Steven Hankin of McKinsey & Company, refers to the competitive landscape of talent management of skilled and valuable employees. Talent management is defined as “the implementation of integrated strategies or systems designed to increase workplace productivity by developing improved processes for attracting, developing, retaining and utilizing people with the required skills and aptitude to meet current and future business needs” (Lockwood, 2006). This paper talks about the challenges faced by organizations and how organizations use strategic HR to overcome concerns regarding attraction, recruitment and retention of talented employees. A few HR executives have raised that “the single greatest challenge in workforce management is creating or maintaining their companies’ ability to compete for top talent” (Jones & Keene, 2005).
Do you know that employers are overly concerned with the employees they hire nowadays, unlike in the recent past? Now you do. Essentially, the process of hiring an employee can have a great impact on the future of a company, and hence there are several key concerns employers raise during interviews. In fact, according to a recent research, it has emerged that finding and keeping the right employee has become one of the trendiest issues with employers nowadays. This can be attributed to the fact that HR professionals believe that only the top talent is quite indispensable to the company’s success especially during the modern day harsh economic times.
Understanding the reasons people leave is the first real step in addressing the issues of retention and attraction. Once you have a clear understanding of these reasons, you are ready to move to the next stage of developing an attraction and retention strategy to get and hold talented people. The formula for attracting and especially retaining top talent lies in creating a high level of job satisfaction which includes not only the work itself but factors relating to the climate or work environment. One of the most over-estimated reasons companies think they attract and retain top talent is through financial compensation. However, financial compensation is ranked very low by many employees when compared to achieving job satisfaction.
In today’s fast paced society turnover rate of the employees is quite high and employees keep switching among different jobs. One of the reason behind this that employee may not feel any sense of association with the organization and that they may not feel a sense of shared goals with the organization (Ackoff, 1999). Managers are interested in maximizing their workers’ level of commitment, as the costs of hiring and training new employees are high. Generally, it is expected that employees are more likely to stay with their organization and be highly committed when they can see a strong linkage between the organization and their work. One crucial reason of high turnover of the employees may be that the employee may not feel committed to the organization.
Excessive turnover and absenteeism normally will result in the organization paying additional cost to recruit and train new employees which can and normally will impact the company bottom-line. The problem with many companies today is the inability to recognize that job satisfaction is directly related to their bottom-line and therefore, do not place job satisfaction as one of its urgent administrative priority. This issue is based on organizational failure to recognize the substantial advantages an organization could realize by making an effort to influencing employees’ outlook. When an organization has content employees, they are more inclined to be productive and committed to work and their employers. It is imperative that organizations establish a work environment that entice, inspire and retain the best people which in turn will be beneficial for organization.
This complex changing business world requires organizations to recognize the best approaches in order to stay competitive and reach organizational success. Many companies are considering that downsizing and outsourcing are the best solutions when they are in dilemma, hence, destroying the culture of organization and motivation of the present workforce. Another way that organizations are realizing to be effective is developing an organization motivation plan and turning the employees into key asset to achieve organizational objectives. The scope of this paper includes the organization motivation plan for my company that manufactures small widgets. Although there is a high revenue and growth potential, the costs and time for delivery have been increasing due to low quality of products.
Six Sigma focuses on improving current business processes and performance while Lean Manufacturing focuses on the improvement of the processes of an organization by using highly skilled employees to increase speed and quality. Combining the two methodologies creates an organization that focuses on quality, efficiency and speed to lower operational costs and increase profits. By following the Lean Six Sigma methodology, many companies have attempted to create a lean, waste-free environment ultimately at the expense of the employee and occasionally at the expense of the organization. Variability and Failing the Lean Test Creating a process is not always the answer to every organization. Organizations attempting to reduce waste may find themselves stuck trying to understand precisely where vital financial cuts need to take place.
This enhances the fact that the leaders need to upgrade themselves as per the requirements of the organizations. As the business environment in the present time is much volatile in context, the leaders may have to face difficult situations at many times. This will lead to the betterment of their skill improvements. The self-awareness is one of the most important but least focused competencies for leadership (Thorn, 2012). Self-awareness is the process by which the leaders learn in what conditions they are good at managing and which things they have to still learn.
The excuses need to be put to a stop. The company needs to put in major investments in the company’s standards, in the communication of expectations, and how the company is going to implement new ways to achieve expectations. Without confronting the issue successfully, more and more customers could be lost. New customers are more costly and less profitable to serve than existing ones. So it is important to keep the current employees since they know the business and brand better than new employees.