5 Nov 2022

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How to Address High Employee Turnover

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Academic level: Ph.D.

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One of the issues faced in my workplace is the challenge of high employee turnover. Staff turnover refers to the rate of full-time employees leaving an organization within a financial year ( Abbasi & Hollman, 2000) . This is a human resource management issue because related to staffing, which is a function of the human resource manager. The workplace has been experiencing high rates of employee turnover in recent years, with a majority of employees citing poor management and poor working environment as a reason for leaving the company. The tech industry is the most affected due to the high demand for tech talent with skills and expertise in the field. Competition in the industry has led to poaching of the most talented employees to improve their productivity, which leaves several other companies vulnerable to losing their employees ( Mitchell, Holtom & Lee, 2001) . This necessitates the need for strategies on retaining valuable employees and reducing staff turnout that has adversely affected the firm’s profits. 

Causes of Employee Turnover 

The issue of high staff turnover is a challenge to human resource management as it relates to the human resource function of the organization. Employees are the most valuable resource in the organization because they produce skills, knowledge, and labour need to achieve organizational goals. Several factors have contributed to an escalation in this issue of staff turnover in the organization. The primary reason is employee dissatisfaction due to factors such as poor working environment, lack of communication, and poor leadership ( Hom & Kinicki, 2001) . Employees depart from an organization if they are unhappy with the management style and lose trust in the ability of the management to change. 

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A majority of employees decide to leave their jobs when they feel devalued and unappreciated as employees in the company, which leads to poor job satisfaction. This dissatisfaction is caused by a poor working environment associated with a lack of employee involvement in company decisions and poor communication channels. As a result, it contributes to poor working environments and consequentially high staff turnover ( Hom & Kinicki, 2001) . Employees term lack the motivation to continue working in a poor work environment when they can get a better job offer elsewhere. 

Lack of open communication in the organization contributes to poor employee experience and risks of turnover. Several cases of employee turnover have been caused by minimum communication efforts from the top managers to employees, especially when making decisions and changes to the functioning. For example, a company may pass policies on wages or job requirements without involving employees in the decision-making process. At the same time, managers who fail to incorporate employee feedback into decision-making skills may create a poor work environment that can drive employees away ( Samuel & Chipunza, 2009) . For example, employees may feel unappreciated when their innovative ideas on how to improve productivity are not considered in the decision making. 

Furthermore, employees are leaving the workplace due to a lack of motivation in the organization that affects employee experience. This arises from poor remuneration or incentives or a lack of growth programs that could motivate employees. The wages and benefits offered in the firm do not correspond to the amount of work they do or compare with other firms. As such, they opt to leave after getting a better job with better remunerations and working environment. Furthermore, staff turnover has been associated with fewer growth opportunities, and an employee feels like they will not grow out of their current position ( Abbasi & Hollman, 2000) . They are not getting opportunities to grow in their skills and areas within the firm, with the stagnation leading to dissatisfaction. 

The leadership of an organization also contributes to a poor work environment, depending on the leadership style employed within the top hierarchy. Usually, staff turnover is an indication of something going amiss with the senior leadership in the form of management strategy or leadership style ( Maertz et al., 2007) . Employees who quit working in an organization will often show frustrations with the top administration as well as the human resource department. Human resource managers have a significant role to play in combatting issues of employee turnover because of their close contact and interaction with employees in an organization. They are at the forefront of providing a healthy working environment with the better employee experience. 

Costs of High Staff Turnover 

Staff turnover is a top issue of concern for businesses because of its financial and productivity losses. The time and resources associated with employee turnover make this problem a crucial point for human resource management. The costs of employee turnover are high and many, measured in terms of hiring and training costs, as well as lost productivity ( Maertz et al., 2007) . The turnover creates gaps in staffing, which may cause far-stretching consequences on achieving organizational goals. High employee turnover also challenges the capacity of an organization to be productive and compete in the industry. It may affect the planning and operations of a company due to a gap in staffing. The costs are also incurred in the form of lost productivity, trying to replace a departed employee while competitors in the industry continue to produce. 

It is not often easy to replace highly talented employees, with the organization taking time before grooming a new employee into leveraging full productivity. The company incurs training costs, recruitment, interviewing, as well as knowledge costs when seeking to replace the departed individual. These can have long-term implications on the profits and revenue of a firm. For example, a company may incur between 90 to 200 per cent of an employee's annual income to replace a departing employee completely ( Samuel & Chipunza, 2009) . At the same time, there is also no guarantee or certainty that the company will slowly fill the roles left by departing employees. This means the company will have to cope with lower expectations of the task compared to other firms in the industry. 

Other effects of employee turnover include financial losses due to the loss of revenue from business operations. The productivity generated by a departed employee is lost, resulting in loss of income and profits before a new employee is hired to fill the role. There are also effects of employee turnover on the morale and productivity of the remaining employees. Losing a talented employee can affect the overall productivity of workers, who will need a new form of motivation to reset to their productive ability ( Samuel & Chipunza, 2009)

In the current business environment, it is becoming increasingly difficult to find and retain quality talented employees due to increased demand and stiff competition in the market. For example, it takes a company more than a year in training and development for new talents to leverage the full productivity of the departed employees in the organization. Its consequences include low-quality performances and falling short of achieving business objectives over a set period ( Mitchell, Holtom & Lee, 2001)

Recommendations to Control Employee Turnover 

Several studies have been conducted on how organizations can reduce the problem of high employee turnover. The recommendations are based on improving patient experience in the workplace and making them feel part and parcel of the company. This is the first thing that can retain talented employees in the organization. Studies on staff turnover and retention have focused on strategies to improve employee loyalty and commitment to a company by increasing job satisfaction and employee experience ( Abbasi & Hollman, 2000) . Staff turnover can also be reduced by improving employee experience in the workplace to increase their involvement. This can be achieved through employee engagement, which makes individuals feel part of the organization and participate in making decisions. A significant issue is a favourable working environment that enhances an employee's peace of mind. 

Motivational theories play a crucial role in dealing with the issue of high employee turnover in the organization. The methods describe how a company can motivate its employees to remain committed and loyal to the organization while reducing high staff turnover. Motivation is an essential element for human resource management in enhancing employee commitment to the organization ( Maertz et al., 2007) . Several theories of motivation have been developed, explaining how organizations can implement incentives and motivation structures to retain their valuable employees. The motivation theories include Maslow’s hierarchy of needs that describes how to motivate employees by considering what they need most in their lives. 

The motivation focuses on appreciating employees for their performances and making them feel valued. It can be done in the form of rewards, promotions, benefits, and compensation. The business can improve the work environment by offering competitive pay and benefits for employees together with generous benefits packages for their employees ( Hancock et al., 2013) . For example, an organization offering a competitive salary in conjunction with other benefits will be in a pole position to prevent other companies from snatching its most valuable talents in the industry. Companies have reduced high turnover rates through competitive advantages such as life and health insurance as well as retirement benefit plans for employees ( Firth et al., 2004)

Furthermore, an organization can also reduce staff turnover by offering growth opportunities for employees and dealing with any form of stagnation in their careers. Employees will commit to a company that assures them of growth and promotion as they gain experience through improving their skills and knowledge. One way of offering growth opportunities is by developing them to improve employee skills and allow them to perform more tasks ( Samuel & Chipunza, 2009) . Training can help employees to stay up-to-date with current technology. 

However, there are other factors other than salary and benefits that determine staff turnover in the organization. Several theories have been developed to explain how to deal with issues of employee turnover away from motivation. For example, the equality theory explains the relationship between better treatment and higher productivity. A working environment that allows diverse views from employees and upholds equality is crucial for employee retention ( Abbasi & Hollman, 2000) . The workplace environment is described by how people treat each and the relationship with the management. The recommendations for reducing high employee turnover, therefore, start with the top management within an organization. 

Other theorists have recommended developing an employee experience strategy that determines how to improve job satisfaction. For example, top companies have reduced employee turnover through workforce and human capital management cloud solutions. These strategies entail retaining the best talents by creating an exceptional employee experience at the workplace ( Mitchell, Holtom & Lee, 2001) . This is the primary and fundamental factor in reducing employee turnover since an excellent working environment improves the employee experience. Creating such a situation results in employees feeling valued and appreciate to be part of the company 

Another recommendation is to make changes in the management strategies and leadership styles since employee turnover starts with problems at the top. Leaders can improve employee retention by changing their management styles and adopting an approach that allows employees to collaborate in the running of the company. The relationship can be one way of reducing work-related stress for employees that have been associated with dissatisfaction ( Hom & Kinicki, 2001) . A positive relationship entails creating open communication channels that allow for feedback. Leaders should move towards investing in honest conversations with employees that will make them stick with the company and reduce turnover. 

Open communication is an essential part of tying employees to the organization. Communication is crucial for an organization looking to improve the relationship and trust with employees. An open communication system allows the company to share the vision and mission to all employees and involve them in making decisions. Involving employees in decision making plans makes them feel valued and appreciated by the top management and reduces the chances of losing talented human resources to competitors in the industry ( Firth et al., 2004) . The company can look towards developing a meaningful feedback process, allowing employees to express their concerns and give their opinions. 

Lastly, the recommendation is to build an influential corporate culture that can drive meaningful workplace satisfaction. Company culture is essential when looking to establish employee loyalty and commitment to a business, and can play a critical role in reducing the high staff turnover ( Abbasi & Hollman, 2000) . This culture entails creating an extraordinary workplace environment that encourages personal growth and unity among all staff members. This can help in making employees feel appreciated and part of the company. An aspect of a strong corporate culture is workplace flexibility, which allows employees a leeway to balance between personal life, family matters, and issues of employment. This is because employees have the problems they need to attend and will appreciate when an organization respects them. The orientation of employees into the organization after recruitment sets the foundation for their loyalty by informing them about the company culture, work environment, and performance expectations, then training them and guiding them on how to adapt seamlessly ( Samuel & Chipunza, 2009)

In essence, the human resource manager can reduce employee turnover by ensuring employees enjoy working in the organization. The plan is to make employees feel valued and appreciated in the business whose welfare is the top priority of the company. There are examples of companies that have managed to reduce employee turnover through proper employee management. Corporations such as Starbucks and Kronos have the lowest rate of staff turnover due to putting employees at the forefront of all human resource operations. The companies offer competitive benefits and have invested in employee engagement as a way of improving staff experience. At the same time, they have created an enriching culture of rewarding employees for their excellent performances as a critical motivation for retaining the most valuable ones ( Hancock et al., 2013)

Conclusion 

There has been high employee turnover in my workplace in recent years as more employees depart for other companies in the industry. This is a major human resource management issue that has severe implications for the organization. Staff turnover is associated with several costs for replacing the departed employee, which can eat into a company’s productivity. In most cases, the turnover is created by employee dissatisfaction due to poor work environment and employee experience ( Hom & Kinicki, 2001) . The lack of communication and engagement between employees and the management affects their satisfaction and commitment, often driving them away from the company. Recommendations to deal with high employee turnover include increasing compensation packages and creating an excellent employee experience. Furthermore, staff turnover can be solved by improving employee satisfaction through a unique working environment. In essence, the top management should be committed to reducing the HRM problem by providing an engaging and collaborative employee experience with an enriching culture that motivates employees. 

References

Abbasi, S. M., & Hollman, K. W. (2000). Turnover: The real bottom line.  Public Personnel Management 29 (3), 333-342. 

Firth, L., Mellor, D. J., Moore, K. A., & Loquet, C. (2004). How can managers reduce employee intention to quit?.  Journal of managerial psychology 19 (2), 170-187. 

Hancock, J. I., Allen, D. G., Bosco, F. A., McDaniel, K. R., & Pierce, C. A. (2013). A meta-analytic review of employee turnover as a predictor of firm performance. Journal of Management 39 (3), 573-603. 

Hom, P. W., & Kinicki, A. J. (2001). Toward a greater understanding of how dissatisfaction drives employee turnover.  Academy of Management Journal 44 (5), 975-987. 

Maertz, C. P., Griffeth, R. W., Campbell, N. S., & Allen, D. G. (2007). The effects of perceived organizational support and perceived supervisor support on employee turnover.  Journal of Organizational Behavior 28 (8), 1059-1075. 

Mitchell, T. R., Holtom, B. C., & Lee, T. W. (2001). How to keep your best employees: Developing an effective retention policy.  The Academy of Management Executive 15 (4), 96-108. 

Samuel, M. O., & Chipunza, C. (2009). Employee retention and turnover: Using motivational variables as a panacea.  African journal of business management 3 (9), 410. 

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