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Identifying True Reasons for Employee Turnover: Insightlink Exit Survey

November 19, 2015

Employee turnover has historically been difficult to measure in dollars since the associated costs often do not appear as an item in company financial statements.

However, after decades of conducting employee research and hundreds and thousands of exit surveys, Insightlink has been able to identify the one key distinction in the turnover process that is the fundamental factor in assessing the true cost of turnover. The key factor here is the degree of preventable turnover.

The research findings prove that over 50% of employee turnover is preventable. This means organisations have a major opportunity to lower the cost of turnover using the InsightEXIT approach.

Insightlink defines voluntary turnover as how many employees leave by choice, which can be due to many different factors. Involuntary turnover, on the other hand, represents the employees who are let go by the organization, whether for just cause or because of a RIF (Reduction in Force).

Employees who are terminated for cause still contribute to turnover costs because they often have to be replaced. With respect to voluntary turnover specifically, the research findings indicate that it is extremely important to know whether employees are leaving for preventable or for non-preventable reasons.

Calculating this number is more valuable than simply knowing the reasons for leaving. This is because by drawing this distinction, organizations can begin to focus on retention strategies specifically designed to reduce preventable turnover among their staffers.

See: Reasons for High Employee Turnover – A ‘must-know’ to Employee Retention!

It is also helpful to learn what percentage of their turnover is non-preventable, representing the employees who leave for reasons that are outside of the organization’s control, since there is little or no need to take action here.

Organizations cannot influence non-preventable turnover because employees may need to take care of other family members or are experiencing health problems or have decided to move out of the area.

In strong contrast to non-preventable departures, preventable turnover occurs when employees leave because of difficulties they are facing with their jobs or in their work environment.

Research shows that the top 3 reasons people quit are:

  1. Lack of advancement opportunities within the organization
  2. Unsatisfactory leadership of senior management
  3. Poor working environment

Having the ability to identify causes that are unique to their own organization will help employers achieve greater success by creating more targeted plans.

As a note to HR managers, Robert Gray, President of Insightlink recommends organisations to know if they could have prevented an employee from leaving, since this is the basic foundation for understanding turnover in your organization.

If you can identify the percentage of your employees that are leaving the company for preventable reasons, then you can also probe deeper to get to the reasons why. Only then can employer turnover be controlled, and effectively retention strategies be implemented to retain bright talent within the organisation.

Also read: Keeping Up Employee Morale during High Turnover

Image credit: referenceforbusiness.com

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