The 7 Hidden Reasons Employees Leave: How to Recognize the Subtle Signs and Act Before It's Too Lateby Leigh Branham
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People are four times more likely to leave a job because of something going on in the office than for an outside opportunity. Yet most managers blame employee turnover on the lure of other companies. . . even when the real factors are well within their control. Based on research performed by the prestigious Saratoga Institute, The 7 Hidden Reasons Employees Leave provides readers with real solutions for the costly problem of employee turnover. Now incorporating the results of the author’s “Decision to Leave” post-exit survey, the second edition features new research in employee engagement as well as innovative best practices for engaging and retaining in a down economy. Readers will learn how to align employee expectations with the realities of the position, avoid job–person mismatches, and provide feedback and coaching that breed employee confidence. 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.
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:
- Start the new job with enthusiasm.
- Question the decision to accept the job.
- Think seriously about quitting.
- Try to change things.
- Resolve to quit.
- Consider the cost of quitting.
- Passively seek another job.
- Prepare to actively seek.
- Actively seek.
- Get new job offer.
- Quit to accept new job, quit without a job, or stay and disengage.
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:
- The need for trust. Expecting the company and management to deliver on its promises, to be honest and open in all communication with you, to invest in you, to treat you fairly and to compensate you in a fair and timely manner.
- The need to have hope. Believing you will be able to grow, develop your skills and have the opportunity for advancement or career progress.
- 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.
- The need to feel competent. Expecting you will be matched to a job that aligns with your talents and your desire for a challenge.
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:
- The job or workplace was not as expected.
- The mismatch between job and person.
- Too little coaching and feedback.
- Too few growth and advancement opportunities.
- Feeling devalued and unrecognized.
- Stress from overwork and work-life imbalance.
- Loss of trust and confidence in senior leaders.
"The editors at Elite Professionals recommend this important book for every employer, manager and supervisor – Anyone dealing with the recruitment or management of employees!" - Elite Professionals Magazine
"...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
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Read an Excerpt
The 7 Hidden Reasons Employees Leave
By Leigh Branham
AMACOM BooksCopyright © 2005 Leigh Branham
All right reserved.
Chapter OneWhy They Leave: What the Research Reveals
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.
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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.
What People are saying about this
Dr. Jac Fitz-enz, Founder & CEO, Human Capital Source; author of The ROI of Human Capital
"Any book that can give you ideas that help you retain just one employee is worth the cover price many times over. Leigh Branham's book can help you hold on to your best. It's chock full of practical examples and suggestions, best practices, and inspiring stories. Highly recommended."
Robert Levering, coauthor of Fortune's "100 Best Companies to Work for" list; cofounder of Great Place to Work® Institute
“Branham's work will help companies better understand employee turnover's devastating impact on their culture and their bottom line. And insightful leaders will use his practical advice to help employees stay, and their companies succeed.”
Jeff Chambers, Vice President, Human Resources, SAS
"A solid and stimulating set of insights, ideas, and solutions around the ongoing challenge of engaging and retaining talent."
Lou Kaucic, Chief People Officer, Applebee’s International, Inc."
Meet the Author
LEIGH BRANHAM is founder/principal of the consulting firm Keeping the People, Inc., and widely recognized as an authority on employee engagement. He is the author of Keeping the People Who Keep You in Business.
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