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Perhaps the real question is: Why are they looking for new jobs in the first place? According to more than 80% of employees, it's not that there's greener grass on the other side of the fence; it's the preponderance of negative factors in their ...
Perhaps the real question is: Why are they looking for new jobs in the first place? According to more than 80% of employees, it's not that there's greener grass on the other side of the fence; it's the preponderance of negative factors in their current workplaces-from poor management practices to toxic workplace cultures-that essentially push them toward the door.
The 7 Hidden Reasons Employees Leave can help you identify the "push" factors in your organization, and mitigate or eliminate all of them. Incorporating data from surveys performed by the prestigious Saratoga Institute of more than 19,000 employees, this critical book examines in depth: How the employee and the employer travel a two-way street of expectation and reality; what are the warning signs of unmet expectations, and how can you best act on them? How incomplete talent strategies lead to employee-job mismatches; why a passion for matching must become a core competency in your organization. The ultimate cost of insufficient or ineffectual feedback; a five-step coaching process that builds strong and durable working relationships. How growth and advancement opportunities are not keeping pace with new career expectations; how to create opportunities and help your employees create their own. Best pay practices, rewards programs, and other initiatives for valuing and recognizing employees; understanding the emotional impact of compensation and recognition programs. The real toll that stress and overwork take on your employees-and on your bottom line; a look at how the best places to work in America got that way, even without high-profile or "newfangled" perks or benefits. How leadership and employees can (and must) build an environment of mutual trust and confidence; the three universal questions every employee needs answered, and how a disengaged workforce is the direct result of detached leadership.
The key to becoming an Employer of Choice-a workplace where top talent are knocking down the doors to get in-is to develop the attitudes and implement the programs that address each of the above areas. The 7 Hidden Reasons Employees Leave presents 54 Best Practices that will serve as the building blocks for a proactive approach to employee satisfaction, growth, and retention.
The Process of Disengagement
Employee turnover is not an event — it is a process of disengagement that can take days, weeks, months or even years until the actual decision to leave occurs.
There are several sequential and predictable steps that can unfold in the employee's journey from disengagement to departure. These are:
Many managers are so busy or preoccupied that they wouldn't notice where their employees were in the continuum if they wore signs around their necks that proclaimed "Trying to Change Things!" or "Becoming Less Engaged Every Day!" Managers need to better understand the signs of discontent before they lose their best and brightest people.
The Deliberation Process
There are two distinct periods in an employee's thought process when he or she considers leaving a company. The first period is the time between his or her first thoughts of quitting and the subsequent decision to leave, when disappointment and even bitterness can set in due to an array of possible circumstances.
The second period of the deliberation process is the time between the employee's decision to leave and the actual leaving. The chances of a manager gaining renewed commitment from an employee in this period are not very good. This is why managers must keep their antennae up and be alert to the signs that an employee is just starting to disengage when there is still time to do something about it.
Why They Leave
Employees begin to disengage and think about leaving when one or more of four fundamental human needs are not being met. These needs are:
Hidden Reasons and Practical Actions
People complain of poor management when what they want is good management. They complain of favoritism when what they prefer is an even playing field. Along the same line, in describing the seven main reasons employees leave, one comes ever closer to pinpointing what it will take to make employees want to stay with an organization and be more fully engaged. Those seven reasons are:
"...provides an arsenal of innovative strategies to help business leaders and managers keep the people upon which their company depends." —Alan Caruba's BookViews
"The book examines factors such as manager relationships, lack of trust in senior leadership, company culture and integrity, salary and benefits, and more-revealing what can be done to hold on to the people who provide the most value to the organization." — Recognize Service Excellence blog
"I strongly recommend Branham's updated book for managers and business owners who need to address employee retention for a better bottom line." — Quality Service Marketing
Why Care About Why They Leave?
The greatest obstacle to discovery is not ignorance—
it is the illusion of knowledge.
It was almost six weeks since Anna had resigned her position with her former employer, but it was obvious that strong feelings were still stirring inside her.
“I was thrown into the job with no training. I asked for some one-on-one time with my manager to go over the project inside out, but he never had the time. I sensed he didn’t really know enough to be able to thoroughly brief me a anyway.
“When I got feedback that certain work wasn’t acceptable, he wouldn’t be specific about how to correct it in the future. . . . He actually enjoyed intimidating people, and he had a terrible temper—he would ask me a question and a if I didn’t know the answer, he would make fun of me in front of my coworkers.
As it turns out, he wasn’t following the right work procedures himself.
“Later, when I was working way below my skill set, I was told they weren’t ready to give me a promotion, even though I had mastered everything.
“Finally, when I resigned, they didn’t seem interested in why I was leaving.
There was no exit interview.They never listened to me when I was there a and they certainly didn’t care to listen when I left.”
Anna went on to say that she loved her management position with her new employer:“I’m still doing what I love to do, but in a much more professional environment. There’s open communication and no game playing. a know where I stand with them at all times.”
One more thing—Anna went on to mention that she had hired away a talented colleague from her former company.
In the post-exit interviews I do for client companies with employees they regretted losing, these are the kinds of stories I hear. I know there are two sides to every story and that Anna’s former manager might tell it differently. But a also know that there is truth in Anna’s story, and in all the stories I hear—more truth than many were willing to tell their former employers when they checked out on their last day of employment.
The good news is that some companies do wake up and realize it’s not too late to start listening to both former and current employees. Some grow alarmed at the sudden departure of highly valued workers who leave over the course of a few weeks.Others become concerned about protecting their reputation as a desirable place to work, and most simply want to make sure they have the talent they need to achieve their business objectives.
Why Many Managers Don’t Care
The fact is that many managers and even senior executives simply don’t care about why their employees are leaving.Their attitude seems to be “If you don’t like it, don’t let the door hit you in the backside on your way out!” If this sounds familiar, it should, because it describes the prevailing mindset of most managers in American companies today. Most are overworked, and many are frustrated by their inability to meet the demands of the current workforce a much less do exit interviews.And, increasingly, human resource departments are so understaffed that they have little time to do more than ask departing employees to complete perfunctory exit surveys on their last day.You care about preventing turnover, or you wouldn’t be reading this book. So why do you care? Why even take the time and effort to uncover the real reasons employees leave? It would be much easier just to accept what most employees say in exit interviews.You know the usual answers—“more money,” “better opportunity.”
There are many ways to rationalize the loss of talent:
● Who has time to stop and wonder why they left, anyway? They’re gone.
● They didn’t want to be here, so why worry about what they think?
● They were probably just disgruntled or had the wrong attitude or just didn’t fit.
● We can’t expect to retain everybody we hire.
● There’s nobody that isn’t replaceable.
● Let’s just get on with finding a replacement.
Of course, we cannot hope to keep all our valued talent. But good managers care enough to try to understand why good people leave, especially when the departure could have been prevented.There will always be managers who are too preoccupied, self-focused, or insensitive to notice the signs that employees are becoming disengaged and too uncaring, complacent, blaming a in denial, insecure, or ego-defensive to find out the real reasons they left.They too readily accept turnover as “a cost of doing business.” They are too willing to believe the superficial reasons for leaving that employees give in exit interviews.
Why? Psychologists call it “motivated blindness”; they cannot handle the truth—that the real reason the employee left may be linked to their own behavior.These managers are actually choosing not to see, hear, or speak the
“evil” that plagues them.
As Brad, another employee, told me during an exit interview, “It seems like most managers just don’t care enough to go to any effort to retain good people.”But many managers do care enough to coach, train, develop, and keep their direct reports engaged. Now what we need are more organizations that make heroes of these managers, not just by praising them but also by measuring their contributions and rewarding them with serious money.
Managers Cannot Hear What Workers Will Not Speak
As we know, when exiting employees come to the question “Why are you leaving?,”most are not inclined to tell the whole truth.Rather than risk burning a bridge with the former manager, whose reference they might need a they’ll just say or write “better opportunity” or “higher pay.”Why would they want to go into the unpleasant truth about how they never got any feedback or recognition from the boss or were passed over for promotion?
So, it is no wonder that in one survey, 89 percent of managers said they believe that employees leave and stay mostly for the money. Yet, my own research, the Saratoga Institute’s surveys of almost twenty thousand workers from eighteen industries, and the research reported in dozens of other studies reveal that about 80 to 90 percent of employees leave for reasons related not to the level of pay but to the job, the manager, the culture, or the work environment.
These internal reasons—also known as “push” factors, as opposed to
“pull” factors such as a better-paying outside opportunity—are within the power of the organization and the manager to change and control. But you can’t change what you don’t know. It is a simple case of “when you don’t know what’s causing the problem, you can’t expect to fix it.”
This disconcerting disconnect between what managers believe and the reality—
the true root causes of employee disengagement and turnover—is costing businesses in the billions of dollars per year. (See Figure 1.1.)
The Saratoga Institute estimated the cost of losing the average employee to be one times annual salary. This means that a company with three hundred employees, an average employee salary of $35,000, and a voluntary turnover rate of 15 percent a year is losing $1,575,000 per year in turnover costs alone.
If, for the sake of illustration, 70 percent of this company’s forty-five yearly voluntary turnovers—thirty-one employees—are avoidable, then the company a by correcting the root causes, could be saving $1,102,500 per year.This should be enough to make most CEOs raise their eyebrows and take action.
Just looking at turnover costs doesn’t tell the whole story, however. Long before many employees leave, they become disengaged. Disengaged employees are uncommitted, marginally productive, frequently absent, or, in the case of the actively disengaged, actually working against the interests of the company.
The Gallup Organization reports that 70 percent of the American workforce is either disengaged or actively disengaged. (See Figure 1.2.)
Actively disengaged workers can be particularly destructive to morale and revenues, for these are the workers who seek to disrupt, complain, have accidents a steal from the company, and occupy the time and attention of managers that would be far better spent dealing with other workers.
The cost to the U.S. economy of disengaged employees is estimated to be somewhere between $254 and $363 billion annually. The cost of absenteeism alone, a signal symptom of disengagement, is estimated to be $40 billion per year.
Most of the mind-boggling costs accumulate from the loss of sales revenue caused by customers’ disappointing interactions with disengaged employees a many of whom are turnovers waiting to happen. Simply put, employee disengagement creates customer disengagement, and employee defections create customer defections.
Breaking it down further,Gallup found that “top-quartile workgroups (on employee engagement surveys) have:
12 Percent Higher Customer Metrics
18 Percent Higher Productivity
16 Percent Higher Profitability
37 Percent Lower Absenteeism
25 Percent Lower Turnover (in Low-Turnover Organizations)
49 Percent Lower Turnover (in High-Turnover Organizations)
27 Percent Less Theft
49 Percent Fewer Safety Incidents
41 Percent Fewer Patient Safety Incidents
60 Percent Fewer Quality Incidents (Defects
So, the best reason to be concerned about understanding the root causes of voluntary employee turnover and disengagement is an economic one. It’s not about being nice to employees just to be nice, although civility is a standard of behavior to be prized in itself. It’s about taking care of employees so that they will then feel good about taking care of customers.9 The good news is that engaged employees actually create happy customers. So, if we can commit to correctly identifying the root causes of employee disengagement and if we can address these root causes with on-target solutions that increase the engagement of our workers,we will see tangible results in the form of reduced turnover costs and increased revenues.
|Ch. 1||Why care about why they leave?||1|
|Ch. 2||How they disengage and quit||11|
|Ch. 3||Why they leave : what the research reveals||17|
|Ch. 4||Reason #1 : the job or workplace was not as expected||31|
|Ch. 5||Reason #2 : the mismatch between job and person||47|
|Ch. 6||Reason #3 : too little coaching and feedback||70|
|Ch. 7||Reason #4 : too few growth and advancement opportunities||93|
|Ch. 8||Reason #5 : feeling devalued and unrecognized||118|
|Ch. 9||Reason #6 : stress from overwork and work-life imbalance||147|
|Ch. 10||Reason #7 : loss of trust and confidence in senior leaders||179|
|Ch. 11||Planning to become an employer of choice||196|
|App. A||Summary checklist of employer-of-choice engagement practices||215|
|App. B||Guidelines and considerations for exit interviewing/surveying and turnover analysis||218|
Sometimes if we cut through the brain and get to the gut, we learn the truth. -Jac Fitz-enz
If you compiled an alphabetical list of all the reasons for leaving voluntarily from the exit surveys of dozens of organizations, it would look something like this:
Advancement opportunity Benefits Better-paying job Bureaucracy Career change Commuting time or distance Concerns about organization's future Conflict with coworker Discrimination based on race, gender, religion, etc. Dishonest or unethical leaders or managers Distrust of, or loss of confidence in, senior leaders Excessive workload Favoritism Fear of job elimination Geographic location of the job Health concerns Ideas not welcomed Immediate supervisor Inability to master the job Inflexible work hours Insufficient challenge Insufficient or inappropriate training Insufficient resources to do the job Job elimination Job itself Job responsibilities Job security Limited earnings potential Little or no bonus Little or no empowerment Little or no growth or developmental opportunity Little or no performance feedback Negative work environment No authority to do the job No career path No consequences for nonperformers No way to voice concerns Not allowed to complete the job Not allowed to do the job my own way Not paid competitively Not paid in proportion to contributions Not recognized for contributions Organization culture Organization instability or turmoil Organization politics Outdated or inadequate equipment Physical facility noisy, dirty, hot, or cramped Poor communication Poor teamwork Retirement Return to school Self-employment Sexual harassment Spouse relocation Stress Timeliness of pay increases Too many changes Treated poorly Uncaring leadership Unfair pay increases Unfair performance appraisal process Unfair promotion practices Unfair rules, policies, or procedures Unwanted change in job duties Unwanted relocation Vacation policy Work-life imbalance
These 67 reasons were, in fact, taken from exit survey responses completed by thousands of exiting employees. When you take away the unpreventable reasons (though some may have preventable origins)-advancement opportunity, better-paying job, career change, commuting time/distance, geographic location of job, job elimination, retirement, return to school, self-employment, and spouse relocation-you are still left with 57 preventable reasons for voluntary turnover.
While reading and categorizing the comments from among 3,149 employees who voluntarily left their employers, as surveyed by Saratoga, I could not help being touched by the emotions expressed in them-disappointment, frustration, anger, disillusionment, resentment, betrayal, to name the most common. It occurred to me that very few of the "reasons" for turnover were based on reasoned thinking-they were mostly rooted in strong feelings.
As I analyzed and grouped the reasons for leaving, looking for common denominators, and peeling off layers from the onion in search of root causes, it became clear that employees begin to disengage and think about leaving when one or more of four fundamental human needs are not being met:
1. The Need for Trust: Expecting the company and management to deliver on its promises, to be honest and open in all communications with you, to invest in you, to treat you fairly, and to compensate you fairly and on time.
2. The Need to Have Hope: Believing that you will be able to grow, develop your skills on the job and through training, and have the opportunity for advancement or career progress leading to higher earnings.
3. The Need to Feel a Sense of Worth: Feeling confident that if you work hard, do your best, demonstrate commitment, and make meaningful contributions, you will be recognized and rewarded accordingly. Feeling worthy also means that you will be shown respect and regarded as a valued asset, not as a cost, to the organization.
4. The Need to Feel Competent: Expecting that you will be matched to a job that makes good use of your talents and is challenging, receive the necessary training to perform the job capably, see the end results of your work, and obtain regular feedback on your performance.
Why Employees Say They Leave
When we look at the reasons employees give for leaving in Saratoga's confidential third-party exit surveys, it becomes obvious that these basic psychic needs are not being met. As we see in the pie chart of reasons for leaving (Figure 3-1), the responses to the question "Why did you leave?" were classified into the following groups:
1. Limited Career Growth or Promotional Opportunity (16 percent), indicating a lack of hope.
2. Lack of Respect from or Support by Supervisor (13 percent), indicating a lack of trust or confidence.
3. Compensation (12 percent), indicating an issue of worth or value.
4. Job Duties Boring or Unchallenging (11 percent), indicating a lack of competence and fulfillment in the work itself.
5. Supervisor's Lack of Leadership Skills (9 percent), indicating a lack of trust and confidence.
6. Work Hours (6 percent), including comments ranging from undesirable work schedule, to inflexibility, to overtime (too much or too little), to undesirable shift-reasons indicating a lack of worth, inasmuch as the organization, in their minds, did not view their satisfaction as important enough to warrant a change.
7. Unavoidable Reasons (5 percent), generally considered unpreventable by the organization and including excessive commuting distance, retirement, birth of a child, child-care issues, relocation, other family issues, career change, too much travel, return to school, and death or illness in the family.
8. Lack of Recognition (4 percent), indicating a lack of worth.
9. Favoritism by Supervisor (4 percent), indicating a lack of trust.
10. Supervisor's Poor Employee Relations (4 percent), indicating a lack of trust.
11. Poor Working Conditions (3 percent), pertaining mostly to undesirable physical conditions, indicating a lack of worth.
12. Training (3 percent), pertaining mostly to insufficient offerings, poorly conducted training, or the denial of permission to attend training-all indicating the lack of perceived worth.
13. Supervisor's Incompetence (2 percent), indicating a lack of trust and confidence.
14. Poor Senior Leadership (2 percent), same reasons as those given for next level management, plus lack of clear vision or direction-indicating a lack of trust or confidence.
15. Supervisor's Lack of Technical Skills (1 percent), indicating a lack of trust and confidence.
16. Discrimination (1 percent), indicating a lack of trust and hope.
17. Harassment (1 percent), indicating a lack of trust.
18. Benefits (1 percent), indicating a lack of worth.
19. Coworkers' Attitude (1 percent), indicating a lack of trust.
Click on link to enlarge
To get below the surface of the exit survey responses, Saratoga conducted focus groups with respondents to probe further into their reasons for leaving, and analyzed the content of written survey comments. When employees are asked to give open-ended feedback, either in writing or open discussion, they are no longer just responding to prefabricated questions-they are speaking from their hearts about the needs that were not met.
Here are the ten most frequently mentioned issues identified in departed employees' responses to the question, "What did ABC Company (former employer) do poorly?"
1. Poor Management: The comments were mostly about uncaring, incompetent, and unprofessional managers, but also complaints about managers overworking them, not showing respect, not listening to their ideas, putting them in the wrong jobs, making no effort to retain them, emphasizing speed over quality, and being abusive. There were also many comments about poor or nonexistent methods of selecting managers. (Issues: Trust, Worth, Hope, and Competence)
2. Lack of Career Growth and Advancement Opportunity: Comments were mainly about having no perceivable career path, but also about the company's failure to post jobs or fill jobs from within, and unfair promotions or favoritism. (Issues: Hope and Trust)
3. Poor Communications: Comments were mostly about top-down communication from managers and senior leaders (particularly the lack of openness with information) but also about miscommunication between departments, from the human resources department, from corporate offices to field offices, and following mergers. (Issues: Trust and Worth)
4. Pay: Comments were mostly about not being paid fair-market value or not being paid in proportion to their contributions and hard work, but also complaints about pay inequities, slow pay raises, favoritism in giving raises and bonuses, and ineffective performance appraisals. (Issues: Trust and Worth)
5. Lack of Recognition: This issue is connected to issues of pay and workload, but there were many comments about the organization's culture not being one that encourages recognition. (Issue: Worth)
6. Poor Senior Leadership: The comments were mostly about lack of caring about, listening to, or investing in employees, but also about executives being isolated, remote, and unresponsive, providing no inspiring vision or direction, sending mixed messages, making too many changes in direction and organizational structure. (Issues: Trust and Worth)
7. Lack of Training: Comments were mainly about not receiving enough training to do their current jobs properly, but also citing poor quality of training, being rushed through superficial training, lack of new hire training, poor management training, and lack of training for future advancement. (Issues: Worth, Hope, and Competence)
8. Excessive Workload: The comments were mainly about being asked to do more with fewer staff, but also about sacrificing quality and customer service to make the numbers. (Issues: Worth and Competence)
9. Lack of Tools and Resources: Comments cited a range of issues, including inadequate office supplies, malfunctioning computers, poor phone system support, outdated technology, and lack of human resources to relieve overwork. (Issues: Worth, Hope, and Competence)
10. Lack of Teamwork: Comments were mainly about lack of coworker cooperation and commitment to get the job done, but also mentioning lack of coordination between departments or different locations. (Issues: Trust and Competence)
What Caused Their Initial Dissatisfaction?
As noted in Chapter Two, employees often experience an initial shock or disappointment that may ultimately result in their leaving the organization. At one time, Saratoga Institute included the question, "What caused your initial dissatisfaction?" in its post-exit survey, but dropped the question after reviewing the first 950 responses. As it turned out, the nineteen reasons for leaving shown in the pie chart in Figure 3-1 were identical to the reasons for initial dissatisfaction and in the same order from top to bottom!
This lends added weight to the conclusion that most people ultimately leave for a reason that had as its genesis an event that may have occurred weeks or months earlier. Again, the key reminder and good news in this for managers is that there is a built-in period of "rescue time" during which they have the opportunity to identify the employee's dissatisfaction and try to correct it.
A Few Words About Pay
In spite of the fact that hundreds of employees surveyed had worked for companies that did not pay competitively compared to other companies in their industries, compensation issues still amounted to no more than 12 percent of all reasons for leaving.
This finding is consistent with the conclusion of Saratoga's comprehensive 1997 report, in which lead researchers Barbara Davison and Jac Fitz-enz, in their chapter on why employees leave, stated:
Pay ... is often a smokescreen, not a primary reason that employees leave one organization and move to another. Saratoga Institute's ongoing research into retention shows that less than 20 percent leave for better pay.
Competitive pay is fundamental to retention; however, the ramifications of continually "buying" employees are not always in the best interest of the organization. The remaining employees are always affected, pay plans become ineffective, and the financial impact can be far-reaching ... However, maintaining a competitive pay plan on the front end and facing up to job and working conditions has a greater positive effect.
One of the first laws of retaining employees is to pay at or above what the market is paying for similar jobs. Competitive pay is the ticket to admission for organizations wishing to qualify as employers of choice, yet survey results make it clear that many companies have not yet purchased that ticket.
Regarding the individual employee's decision to stay or leave based on pay, Saratoga's director of research, W. Michael Kelly, observed, "The rule of thumb is that in a healthy job market an unhappy employee will bolt the company for a 5 percent pay increase, but it will take at least an increase of 20 percent to compel a satisfied employee to jump ship." Of course, pay is more important to some than it is to others. We know that many employees who struggle to pay their bills can understandably be enticed to leave for increases of less than 5 percent.
Do You Know Your "Poach Rate?"
If you still think retention is mainly about money, find out how much it is costing your competition to get people to leave you. That's called your "poach rate." If your poach rate is less than 20 percent, it ain't the money, honey! People who love their work, love their boss, and love their company don't leave unless the offer is coming from the Godfather. -John Putzier
Several studies have also shown that, in general, salespeople are more money-motivated than most other workers. And, at the other end of the spectrum, we all know individuals whose loyalty to their employer, or to their manager, is so strong that they have turned down increases of 30 percent or more because they could not imagine being treated better, or finding a more satisfying job, elsewhere. Indeed, we can find plenty of these people happily employed at America's top employers of choice.
In reviewing survey comments about pay from both leavers and stayers, it is striking how few comments have to do with the actual amount of salary, bonus, or other incentive. Rather, the key issue seems to be fairness, or the lack thereof.
Excerpted from The 7 Hidden Reasons Employees Leave by Leigh Branham Copyright © 2005 by Leigh Branham. Excerpted by permission.
All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
Excerpts are provided by Dial-A-Book Inc. solely for the personal use of visitors to this web site.
Posted October 9, 2006
We recommend Leigh Branham¿s book to every employer, manager, supervisor or small business owner - especially those struggling to recruit or retain high-caliber talent. If you¿re a small business owner or first-time manager who soon will be interviewing and hiring employees, this book will give you a great start. Discover how to re-engage employees who lose their motivation and learn how to institute the best practices to make your workplace an 'employer of choice.' Your office can become a place where people want to work, even while you control the costs of attracting, hiring and retaining committed employees.Was this review helpful? Yes NoThank you for your feedback. Report this reviewThank you, this review has been flagged.