With the right strategy, a high level of employee turnover doesn’t have to be inevitable
The average person will hold about 12 different jobs between the ages of 18 and 48, according to the U.S. Department of Labor. That’s bad news for your utility in terms of general disruption and decreased productivity, not to mention the high cost of recruiting and training new employees.
In fact, the Society of Human Resource Management estimates that organizations spend the equivalent of six to nine months of a departing employee’s salary to find and train a replacement. Some estimates run even higher. A survey conducted by the Center for American Progress shows that the cost can range from 16 percent of an hourly, unsalaried employee’s pay (that’s $6,400 out of a $40,000 annual salary) all the way up to 213 percent of a high-level executive’s salary (which comes out to $319,500 for a $150,000 annual salary).
With those figures in mind, wouldn’t it be great if your employees could scratch their job-hopping itch and hold most of those 12 different jobs within your organization, rather than leaving and becoming free agents every few years? While it may sound far-fetched, doing so doesn’t require bending the time-space continuum or traveling to an alternative dimension. Instead, all it takes is building a culture of internal mobility, says Jack Hill, the director of talent acquisition solutions at PeopleFluent, a talent-management consulting firm (www.peoplefluent.com).
“There’s a real shift occurring in employee-retention efforts within organizations,” says Hill, who has more than 20 years of experience in the employee-recruitment industry.
“Corporations are focusing more on programs that help keep people occupied and transitioning within their organization. If employees are going to hop from job to job, companies need to find a way to let them do it internally — allow people to self-manage career paths. Think of it as a totally different spin on talent acquisition.”
Utilities with turnover so high that a revolving door makes sense lose more than just productivity and the financial resources required to continually recruit and train new employees. They also lose a valuable base of institutional know-how. “There’s no one around to make sure that knowledge trickles down to the next generation of employees,” Hill notes. “And it takes time to get a new employee operating at the same level of productivity as the employee they replaced.”
Moreover, utilities with high rates of employee turnover run the risk of developing a reputation as a bad place to work. And with the ever-burgeoning spread and impact of social media, it doesn’t take long for a utility to find itself with image problems that will likely make recruiting new employees even more difficult, Hill explains.
So what’s the solution to this expensive and resource-sucking problem? Create an organizational mindset in which both employees and managers accept — better yet, even embrace — internal job-hopping as a fact of life. And “both” is the operative word here, Hill points out. “It has to be accepted by both managers and employees — that’s the big trick.”
Managers in particular must walk the walk, not just talk the talk. If they don’t, immediate obstacles arise to cultural change. For example, employees will be reluctant to express a desire to try a new job if they fear retribution from an unsupportive manager. Moreover, managers can also thwart the change initiative by consistently refusing to let great employees move on to other positions.
On the other hand, some employees may not deserve new opportunities. “Part of all this is evaluating whether an employee is worth saving,” Hill explains. “If someone is not an upwardly mobile employee, is it a loss to the organization if they leave? It’s up to organizations to develop succession-planning tools to make those assessments and decisions.”
Talent-acquisition teams must also play a key role by quickly and competently backfilling positions as employees get promoted. Managers need to feel confident about the process — be certain that if they promote a rising star, the void will be filled. “If you build that confidence with managers, then they’ll engage their direct reports a little more,” Hill says.
It’s also critical to establish what Hill calls a culture of internal mobility, which requires managers to keep it top-of-mind in the daily cadence of work. “They have to think every day like they’re selling an idea,” Hill says. He also recommends that internal mobility become a part of the annual job-review process. Managers should talk about their career development within the organization. “If managers aren’t helping employees evolve, then they’re not really managing those employees,” he says.
Organizations also need to more frequently discuss employees’ aspirations for mobility. In other words, just because someone says they’re not interested now doesn’t mean they won’t be in six months. “You need a central ‘living’ data center that we call a talent profile,” he notes.
Another critical component is a solid feedback loop in which employees whose applications for new internal jobs are denied receive a thorough explanation and some coaching. “It’s a simple idea, yet not often practiced,” Hill points out. “You need to keep encouraging them to apply for other positions. If you’re going to build up a culture of internal mobility, it all comes crashing down if you don’t communicate with them. It’s demoralizing.”
Last but not least, organizations have to treat employees that take new internal positions just like new employees. Hill calls this “cross-boarding,” a hybrid of on-boarding. “It’s basically resocializing someone in their new role within an organization.”
The beauty of all these strategies is that they’re not high-cost propositions, either. So organizations have little to lose financially and everything to gain if they develop a culture where employees are self-directed owners of their career development.