It’s the new year and we are all working to establish our organizational goals for the upcoming year. “Reducing turnover” tends to be a common objective, especially within HR. It can be a disheartening path to achieve that goal as it requires talking about the negative aspects of the organization.
When trying to find a solution to high turnover (check out our post from last week if you’re curious about turnover), the most common method is to ask why people are leaving during their exit interview. It’s too late to do something about that person leaving, but hopefully you can make a change to stop others. It is rarely easy to make those changes as most people leave due to their leaders and leadership development doesn’t happen overnight. Do you accept the risk of losing more top talent during that training period? What if that leader never improves despite the guidance? This has always seemed like a reactive and negative approach to retaining the top talent.
Why not look at your organization’s retention number instead? Where turnover looks at how many people an organization has lost, retention takes a more positive spin by focusing on how many people are staying. Just changing your perspective on what is essentially the same message, can drastically alter the impact behind an objective. To calculate a retention rate, start by subtracting the total number of separations within a time frame by the average headcount. The result then gets divided by the average headcount and multiplied by 100. You now have the percentage of people that are choosing to stay with the organization and you can start asking what’s working. Be mindful of the woes that come with calculating this number… analysts can still experience the same struggles they have with turnover (again, check out our post on turnover).
The retention rate can also show if people are not staying and it may be necessary to still ask the question of why people are leaving. But when working to find a solution, set goals based on increasing the retention rate by attracting and keeping the best talent. The goal becomes more appealing and seems more attainable once framed more positively. It may even feel more relevant and, just like that, you’re almost halfway to a SMART goal. And we all know that SMART goals make the annual performance review so much easier all parties involved.
They say you should take time to view a situation from someone else’s street corner as every corner provides a different perspective. Let’s start looking at our people metrics from another street corner. By simply changing our perspective from asking why people are leaving to why people are staying, we can be more proactive. We can implement engagement initiatives based on aspects of the organization’s culture that works. We can figure out what makes a great leader within our organization and develop training programs that give our talent the best foundation to be successful people managers. Yes, calculating this data can be a pain, but it can be instrumental in the success of an organization.
Check out our HR analytics dashboard to spend less time creating the metrics and more time to finding effective solutions