Love’em or Lose’em
Proven Strategies to Enhance Retention and Become an Employer of Choice
By: Bogdan Damjanovic, P.Eng.
Owner, Express Employment Professionals
What’s missing?
Managers identified the following soft skills as
being the most important at their organizations:
•
•
•
•
•
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Organization Skills
Verbal Communication
Teamwork & Collaboration
Problem Solving
Tact & Diplomacy
Business Writing
87%
81%
78%
60%
59%
48%
Definition of Turnover
Number of Separations
=
Total Number of Workforce
Turnover Cost Factors * :
Turnover
Annual Salary
Benefits/Burdens
Expected Length of Vacancy
* Calculations include conservative estimates and assumptions based on research by Price
Waterhouse's Saratoga Institute and the University of Wisconsin
http://www.expresspros.com/us/turnover.aspx
TRUTHS ABOUT
TURNOVER
Truths About Turnover
Truth #1 – Turnover happens
– 0% turnover is not realistic nor desirable
– Good employees quit & leave
– Bad employees quit & stay
Truth #2 – Some Turnover is Desirable
- New employees bring new ideas, approaches & attitudes
Truth #3 – Turnover is costly
– Cost of turnover varies from $1,000 for an entry level employee
to several thousand for an executive
Truths About Turnover
Truth #4 – More $money$ is not always the
answer
– 89% of managers surveyed think money is
the primary factor of turnover.
– However, most employee surveys rank money
as 9th or 10th reason for turnover.
– Employees do want fair & competitive pay.
Truths About Turnover
Truth #5 – Manager is the best person to fix the problem.
– 50% of worker satisfaction is related to their relationship with
their leader.
– Managers, not HR Departments, should be the driver of
employee retention.
– Areas of leader’s ownership:
•
•
•
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Hiring
Performance appraisal
Influence senior managers for needed change.
Most important – EMPLOYEE RECOGNITION
Truth #6 – Turnover demands commitment
WHY SO MUCH
TURNOVER?
March 2010
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•
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The national unemployment rate remained unchanged at 8.2%
Employers added 18,000 jobs
This is the sixth employment gain in the past eight months
Job gains were seen in Ontario, Quebec, and Saskatchewan as follows:
• Construction: + 21,000
• Manufacturing: + 3,900
• Trade: + 13,700
• Transportation & Warehousing: - 19,600
• Finance, Insurance, Real Estate & Leasing: - 7,400
• Professional, Scientific & Technical
• Business, Building & Support Services: - 26,300
• Educational Services: + 6,200
• Healthcare & Social Assistance: + 5,100
• Information, Culture & Recreation: - 6,500
• Accommodation & Food Services: - 3,300
• Public Administration: + 7,900
Services: + 38,400
Why So Much Turnover?
1. Higher expectations




People want more than a job
They want time off and $$
Career opportunities earlier
Employers no longer viewed cradle-to-grave
Why So Much Turnover?
2. Longer hours, more demanding work
 Productivity increased 6.9 percent in the
nonfarm business sector during the fourth
quarter of 2009 as unit labor costs fell 5.9
percent
 From 1977 to 1997, average workweek grew
from 43.6 hours to 47.1 hours.
 More overtime expected with no notice.
 33% of employees bring work home.
 64% of all employees want to work less.
Why So Much Turnover?
3. Family demands
 Day care
 Elder care
•
25% of workforce provides 11 hrs per week
 Men are just as likely as women to adjust
schedules for elder care
DO I NEED A
RETENTION PROGRAM?
Take the Quiz
(If you score more than two “no’s” you
need to get serious about retention.)
TEN REASONS GOOD
PERFORMERS LEAVE
Ten Reasons Good Performers Leave
1.
2.
3.
4.
5.
6.
7.
8.
9.
No link between pay & performance
They don’t perceive advancement opportunities
Their contributions are not recognized
They don’t get to use their natural talents
They have unclear or unrealistic expectations
They will no longer tolerate abusive managers
Management’s cutback on administrative help
Constant reorganization of management
Management not taking time to clarify goals &
objectives
10. Management favoritism
Note: All Ten Reasons Involve Managers
EXIT INTERVIEWS
Exit Interviews
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The worst time to do them is on the last day
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Conduct them after employee departure
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One to two weeks
Call at home
Employees are more willing to speak
Better to meet in person due to body language
Use the opportunity to begin recruiting them back
Interviews are superior to surveys
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Prepare for both
Ask detailed questions
Expand as necessary
They are as important as employment interviews
Exit Interviews
Suggested Questions
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What caused you to seek other employment?
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Why did you accept a new position?
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Describe working for our company.
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Rate compensation and benefits.
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Benefit improvements
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Describe training.
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Did you observe teamwork?
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Describe the relationship between your department and others?
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Could the company have prevented your leaving?
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What needs were not met?
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Did you get to do what you do best?
Exit Interviews
Suggested Questions
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Identify specific things you would change.
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How would you rate the company on:
Ethics
Integrity
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Honesty
Trust
How would you describe your leader?
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Treated fairly
Recognized for your contributions
Fair appraisals
Treated consistently as other department members
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Would you recommend this place to a friend or relative?
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Would you consider re-employment?
Exit Interviews vs. Stay Interviews
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Utilize internal focus groups to analyze turnover.
•
Survey employees on why they stay.
OBSERVATION:
EMPLOYEES DON’T QUIT THEIR
COMPANIES,
MOST QUIT THEIR BOSSES!
Common Core Elements of
Organizations That Excel at Retention
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ETHICS
INTEGRITY
HONESTY
TRUST
Ethics, Integrity, Honesty, and Trust
No benefits, compensation program,
gimmicks or rewards can replace the four
core elements.
The organizations excelling in the four core
elements win the war for talent.
Common Core Elements of
Organizations That Excel at Retention
How do you measure your commitment to the
four core elements?
Ask yourself: Does your organization?

Conduct business according to professional
standards?

Does your company culture support disclosure
of truth even when it hurts?

Does your company base its business
decisions on established values?
Common Core Elements of
Organizations That Excel at Retention
•
Has your CEO earned the trust of your
employees?
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Does your leadership team accept
responsibility for failures or blame others?
RECOGNITION
Facts on Recognition
According to an article in Compensation and
Benefits review:
81% of workers claim they do not receive any reward for
increase in productivity.
60% of managers report the same.
Only 3% of base salary separates average from outstanding
employees.
Most companies have overused giveaways such as:
Coffee Cups, Pens, T-shirts, Certificates
Facts on Recognition
Employees’ favorite form of recognition:
PRAISE
Why Employees Leave and Stay
Employees and Managers are somewhat disconnected
on “WHY” employees leave and stay
Manager Employee
Ranking Ranking
Good wages:
Job security:
Promotion/growth:
Good working conditions:
Interesting work:
Personal loyalty to employees:
Tactful discipline:
Full appreciation of work done:
Sympathetic help on personal problems:
Feeling “in” on things:
1
2
3
4
5
6
7
8
9
10
7
4
5
9
6
8
10
1
3
2
Best Practice Retention Elements
Saratoga Institute survey of 40 Fortune 100
companies including:
Dell
Verizon
Honda of America
UPS
Best Practice Retention Elements
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Innovative compensation & benefits/stock options
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Formal rewards & recognition programs
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Good performance management

Aligning employees goals with business goals
•
Strategies & measures for increasing employee retention
•
Formal career planning
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Work/Life strategies
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Mentoring programs
Recognition Gestures Can Be
Simple
Hewlett-Packard
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Golden Banana Award
Tektronix – Beaverton, OR
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“You Done Good” Cards
NASA – Johnson Space Center
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“Thanks a Million Award”
10 – $100,000 candy bars
Kory Electronics – Seattle, WA

President Head Shaving
Recognition Gestures Can Be
Simple
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Supplying ice cream or Popsicles on a hot day.
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Hiring someone to clean windshields in parking
lot on a snowy day.
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Lottery tickets

Grab as many as you can from a fish bowl
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Hiring H.S. students to wrap holiday gifts.
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Being creative on job titles.

Sales Manager vs. Salesperson
Retention Techniques
SAS Institute – Cary, NC - Software Developer
Ranked 3rd in 100 best companies to work for
• On-site child care for $250/mo
• Laundered workout clothes
• Golf – Tennis – Dance Classes
• Cafeteria w/piano music – Families welcome
• Art on every wall
• Free health clinic
• Elder care coordinator
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Financial planning for college & retirement
SAS spends $45K annually on 22 tons of
candy
SAS Turnover Rate: 3.7%
20% below industry average
DESPITE:
NO STOCK OPTIONS
COMPETITIVE SALARIES
Note: Based on 5,000 employees SAS is losing 850 less
than the industry average
Retention Techniques
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IBM employees in Atlanta wear cutoffs and sandals to
work.
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Employees at Tech Data Corp., Tampa, FL enjoy meals
prepared by an executive chef.
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Electronic Arts – Canada, has a 70 seat movie theater.
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Construction Equipment Co., Louisville, KY, gives
employees’ children a $50 savings bond for straight “A”
report cards.
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Workers at Netscape, Mountain View, CA., can bring
dogs to work
Retention Techniques
A COMMON FAVORITE:
Anheuser-Bush, St. Louis, gives every
employee two free cases of beer each month.
Other Out-of-Box Retention
Techniques
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Retention bonus
Busing or transportation support
Wash employee’s cars in the parking lot
Allowing employees to select job titles
Giving every employee business cards
Donating to employees’ children’s sports teams
Free gardening plot on company land
Free limo service on wedding day
Free Starbuck’s coffee
Two-week paid leave for new fathers
Free infant car seats for new parents
Free breakfast
HIRE THE RIGHT PERSON
Hire the Right Person
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Hiring for talent over experience
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Be Prepared when Hiring
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Not the Warm body approach
Use Updated job descriptions
Balance with analysis
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Do not become fixated on key knowledge areas
Avoid Hiring by gut feeling alone
Avoid “Search for Superman” syndrome
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Do not have too many people involved in the process
Hire the Right Person
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Encourage Diversity
 Discourage “Hiring in your own Image”
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Avoid “Politically Motivated” hiring
 Including: the manager’s neighbor’s friend’s
cousin’s boyfriend, or the “I owe a favor” approach
Hire the Right Person
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Bahavioural Interviewing - proof of performance
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Accurately describe the job
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Mix the good with the bad
Consider the internal candidate
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Competency based interviews
Give me an example when….
Internal Job posting
Don’t allow managers to hold onto talent
Encourage employee referrals
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Produces the highest source of long term hires
HELP YOUR TEAM AVOID
FIRST DAY DISASTERS
Typical Disasters
Employee’s First Day
1. No parking pass.
2. You had to watch 28 videos on how great it is to work here.
3. You signed a 300 page employee handbook stating you fully
understood everything in it.
4. Your cubicle is being used as storage.
5. You were kept in the lobby for three hours.
Typical Disasters
Employee’s First Day
6. You signed two dozen forms asking for info you didn’t bring.
7. You go meet your boss only to learn that s/he is on vacation.
8. Your name tag is misspelled.
9. The senior vice president calls you at home and tells you of
a reorganization.
NEW HIRE CHECKLIST
New Hire Checklist
Orientation is a process, not
a program!
New Hire Checklist
Prior to the First Day:
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Provide key written material such as handbook, etc.
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Arrange for office furnishings, computer, telephone, supplies, etc.
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Consider taking the new hire to lunch prior to the 1st day.
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Plan how you want the new hire to spend their first day
 Who to see
 Set schedule
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Have contact person call to answer questions
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Leave your own calendar open at the beginning and end of the first day
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Send a welcome basket or flowers to home (include spouse)
New Hire Checklist
Day one:
• Meet with your employee early in the day to establish
performance objectives and expectations.
• Introduce the new employee to as many people as possible,
including the CEO
 Let them make their own opinions
• Review organization charts thoroughly.
• Have business cards available.
• Consider having a surprise welcome party.
New Hire Checklist
Day one:
• Have someone tour them through the facility.
• Assign a first week mentor
• Schedule orientation sessions in groups where
possible and have them in the afternoon or on the
second day.
• Provide a new employee a reserved parking spot.
• Provide them with some company logo merchandise.
New Hire Checklist
During week one:
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Introduce new employee very enthusiastically during a group
meeting.
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Newspaper announcements
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Pair up the new employee with a peer.
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Schedule one-on-one meetings with key personnel.
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Give an appropriate and challenging assignment during the first
week.
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Schedule any necessary training.
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Check in with new employee from time to time in first week.
New Hire Checklist
The first three months:
• Schedule a 3-month feedback session.
• Allow employee to re-write their job description,
if outdated.
• Have employee complete new hire survey.
SUMMARY
Summary
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You cannot achieve excellent retention without
an excellent hiring process.
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Create dialog between employees and
managers on work/life issues.
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Have managers re-recruit their employees
regularly.
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Conduct employee opinion surveys regularly to
measure job satisfaction and react to the
results.
Summary
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Hold annual benefit and communication
sessions to educate your employees.
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Conduct exit interviews to find out why they are
leaving.
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Train managers and hold them accountable
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Keep management’s attention on turnover.
•
Orientation is a process, not a one day
program.
Summary
BECOME AN EMPLOYER
OF CHOICE
Contact Details:
Bogdan Damjanovic, P.Eng., Owner
Express Employment Professionals
Tel: (416) 590-9948