Employee turnover is a reality of organizational life. People exit organizations for a host of reasons. Sometimes the employee initiates the exit and sometimes the organization initiates the exit. Irrespective of the reason, employee turnover is disruptive. Turnover interrupts the flow of organizational life. It introduces chaos as organization members seek to understand the reasons for a person's exit and to establish a new social structure. It reduces productivity. Turnover burdens the HR function as exit, recruiting, interviewing, and on-boarding processes kick into high gear.
The HR datafication trend (increased reliance on metrics) is sparking some leaders and HR professionals to take a hard look at data that illuminates turnover risk. Some exits are not preventable, but some are. If given an attractive alternative, how many people in your organization would choose to stay and how many would choose to go? Perhaps more importantly, would your top talent filling critical positions choose to stay?
A simple, effective method for taking stock of employee turnover risk is to assess the proportion of employees in your organization who are enthusiastic stayers, enthusiastic leavers, reluctant stayers, and reluctant leavers. Peter Hom's major review and reconceptualization of research on employee turnover generated this helpful framework1. This perspective highlights two important dimensions. First, people wish to either remain with or leave the organization. Second, people perceive either substantial or little control over their employment options. Crossing these two dimensions yields four groups of employees.
Employee Turnover Mindsets
Enthusiastic Stayers are strongly committed to the organization and engaged in their work. They could probably leave the organization, if they so desired. But they are unlikely to actively consider alternative employment options. Enthusiastic Stayers work hard, contribute positively to the culture, and tend to pitch in as good organizational citizens beyond their essential duties.
A great target for a healthy organization is 80% Enthusiastic Stayers. Why just 80%? Wouldn't 100% Enthusiastic Stayers be even better? In reality, 100% Enthusiastic Stayers is probably not possible and actually undesirable. 100% Enthusiastic Stayers would indicate an organization that is over-investing in retaining top-talent people. 80% represents the point of diminishing returns where resources could probably be better invested into R&D, logistics, marketing, sales, etc..., to grow the business.
Enthusiastic Leavers have both the desire and the ability to leave your organization. The desire to leave often represents a lack of fit between the person and the organization's culture (the Attraction-Selection-Attrition employee life cycle). Once a person enters into the poor fit mindset, there's often little an organization can do to change the outcome. Enthusiastic Leavers actively engage in job search activities and often use work time to pursue new opportunities. In extreme cases, an Enthusiastic Leaver may choose to exit the organization without new employment in hand. Fortunately for everyone, Enthusiastic Leavers tend to exit quickly once they transition to this mindset. As long as they don't damage other stayers or the organization's culture while they remain in the organization, there's little opportunity to impact this group.
Reluctant Leavers are a mixed group. Some Reluctant Leavers wish to remain members of the organization but due to a host of possible reasons (poor performance, poor attitude, downsizing, mergers & acquisitions), the organization decides to separate the employee. Other Reluctant Leavers choose to exit the organization to support the career of a spouse, to care for elderly or ill family members, to raise children, or to pursue other goals. As long as the exit process is smooth, Reluctant Leavers rarely damage the organization or its culture. In fact, the departure of a Reluctant Leaver can boost satisfaction and commitment of remaining team members who perceive their sense of loss at the exit. Losing top talent the organization prefers to retain is generally the toughest consequence.
A strong organization monitors closely for signs of Reluctant Stayers. This group would choose to leave the organization if they could. Reluctant Stayers lack choice due to either unavailability of options (e.g., economic downturns, highly specialized skills) or due to poor marketability to other organizations.
Unable to leave an organization they do not desire to be part of, Reluctant Stayers often become bitter. They seek to minimize their time at work through high rates of absenteeism and tardiness. They invest little effort into their work products, resulting in poor performance and low quality. Some may even engage in counterproductive work behaviors such as sabotaging the work of others or theft. In addition, Reluctant Stayers are unlikely to engage in citizenship behavior that supports others or otherwise improves the organization. Reluctant Stayers represent "dysfunctional retention"2; organizations benefit from identifying and efficiently separating these individuals whenever possible.
To keep your organization vibrant and your culture attractive to top performers, focus on two groups -- the Enthusiastic Stayers and the Reluctant Stayers. Enthusiastic Stayers are very good for an organization and Reluctant Stayers can do substantial damage to an organization.
Your Stayer Score = % Enthusiastic Stayers minus % Reluctant Stayers
Ideally, your Stayer Score is as close to 80% as possible. Stayer Scores less than 70% indicate a current or looming turnover problem.
Monitor your Stayer Score. Doing so makes it possible to see the impact of organizational development efforts and to make changes if there's a turnover problem brewing.
On the surface, assessing your Stayer Score is not difficult. The hardest part is accurately placing individuals in the group that best represents their Desire to Stay or Leave, and their Options to Stay or Leave. Both determinations are subjective and perceptual (i.e., there is no concrete reality). For example, a person who believes it will be easy to find alternative employment and embarks on a dedicated search is an Enthusiastic Leaver for the entire period of time it takes them to either find a new position or become disillusioned and convert to a Reluctant Stayer.
Anonymity is also an issue. To avoid guessing, it's important to ask people about their Desires and about how they are actually thinking about Options. However, to get honest responses it's critical for people to feel confident that their personal responses are completely anonymous. For this reason, it is best to use an external organization to assess and report your Stayer Score.
Contact us if you'd like our help assessing your Stayer Score.