Turnover & Retention
Turnover refers to human resource movement within organisations, that is, employees moving from job to job through transfer, promotion or relocation. It is in this that we can see the effectiveness of HRM programmes and activities.
Turnover analysis can provide HR managers with useful information about the likelihood of the future labour supply and the required skills, competencies and experience. Effective management of turnover can identify problem areas and help HRM to develop suitable strategies.
With regards to the dollar figure on what staff turnover costs New Zealand Businesses, this is quite difficult as it varies from company to company depending on the level of position and industry you look at. It is generally considered a rule of thumb that losing a member of staff who has been employed in your organisation for minimum of 12 months will cost you three times their salary.
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Retention of staff is more important than ever in this tight labour market. Therefore, employees who are satisfied with the way their organisation treats them as employees and rewards them for their performance or efforts, are less likely to leave the organisation.
Generally it is considered that if your organisation has a high turnover of staff due to retention issues, this will result in low staff morale, poor service delivery, damage to your organisation brand and your reputation in the market place, and most importantly will be impacting on your financial bottom line.
It is best practice to consider aligning your companies recruitment strategy with your business plan, making sure your future employees are a good fit with the existing team and that their skills will assist the organisation with its goals. Provide training and coaching to all new members of staff in order to enhance their existing capabilities and develop new skills and potential. This training should also be provided to managers, to ensure that they are kept up to date with their communication and interpersonal skills, providing interview training wherever possible to ensure that they understand the recruiting process and who to recruit, rather than going into the process blind and going on a gut feeling. Sucession Planning or Talent Management Training can also be used as way to retain staff within an organisation, as it sends a clear message to all your employees that the organisation is committed to developing future leaders from within.
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Staff Turnover: A productivity issue
Achieving Business Results Through Employee Engagement