Julian Cook is looking at employee turnover in a different way.
Reading time: 5m 30s.
When I was told by my boss at Goldman Sachs that I should think about looking for another job, yeh I was a bit pi**ed off. I’d been working 19 hour days for the past 3 months, including missing my girlfriend’s birthday dinner and not showing up to my close mate’s engagement party (which was on a Saturday night).
But on reflection, he made the right call. It became clear after my first 12 months in the role that I didn’t plan on staying there beyond 6 more months.
My learning curve had flattened out and I could see that my value to the firm over the next few years was a function of how obediently I could follow a set process and how little I would complain about it. My attitude had waned as a result.
The world of corporate finance is incredibly cut-throat like that. They’ll happily accept super high attrition because they only want to get that small percentage of people who will give their left kidney to be inside the walls of a powerhouse bank.
And the only way to find that percentage is to put them through the machine for 12 months and see what comes out in the wash.
Your duty as manager or employer is not to retain good hires as long as possible, but to give them an amazing two to three years with you.
This is a very important point for any leader wanting to ‘tackle the problem of attrition’: Some level of attrition is good because not every hiring decision is good. Without any attrition, you’d be stuck with the duds.
Further, without forceful attrition (or fast-firing), the duds that remain start to erode culture. A survey by UK online job search company Monster suggests that 79% of people take up to two years to physically leave a job after they’ve made the decision to mentally leave.
While you certainly don’t want a revolving door for employees, an evolving door brings a replenishment of new skills, new experience and new perspectives to your team. In particular, a high growth business can bring with it a completely new set of job descriptions for the same role every 18 months.
Patty McCord, former Chief Talent Officer at Netflix, describes in her book Powerful how new recruits were told that Netflix is growing so quickly and changing so rapidly that they couldn’t be guaranteed they’ll have a job in 24 months, even if they did well. But, they could be guaranteed that they’ll learn a lot and “go on and do great things at other places”.
In her words:
“…retention is not a good metric by which to evaluate your team-building success or whether you’ve created a great culture. The measure should not simply be how many people you are keeping, but how many great people you have with the skills and experience you need. How many of them are you keeping and how many new people with the skills and experience you need are you hiring?”
So, is attrition really a problem for you?
Reflect on the impact of the last ‘regrettable leave’ and the last ‘missable leave’. Conduct a team-wide anonymous survey asking these questions:
- Did others know they were about to leave?
- What was the immediate impact on morale?
- How do they see it impacting their ability to do their job in the next 3 months?
- Will this departure have a negative or positive impact on the team’s performance?
Once you’ve got the data, share it with the remaining members of the team and have an open discussion.
“Hey everyone, we know that as a team and as a business we’re not perfect. [Mika’s] departure highlighted some areas that we excel in and some that we don’t. We try our best to deliver every employee with both career progression and personal development. But while the latter can be more potent, it’s harder to get right. So we need your input. In what ways can we support your personal growth ambitions? What initiatives could we take to make your time here more rewarding and more impactful on your life journey?”
Once you’ve had the discussion, put in place a tailored progress plan for each employee. A curriculum that they choose within your budget limitations. Why the focus on delivering personal growth and a tailored progress plan to employees?
Because people seek progress in their life. Simple.
10,000 years ago we were hunter gatherers living in caves. Today we fly through the sky and carry a computer in our pocket. This insatiable desire to improve our life situation is in many ways what separates humans from animals. We won’t rest until we feel we’re progressing.
Work is a vehicle for progress. Progress doesn’t just mean a pay rise or promotion. It also means learning and personal development.
A survey by Investors in People suggests that pay (lack of financial progress) is the key reason people quit. According to Monster, two other pivotal reasons employees quit are:
- Not being challenged
Both of which directly relate to lack of progress in learning and development.
So how can companies tackle increasing employee attrition? Focus more on training employees rather than keeping them.
The reality is, most of your team will leave you after two to three years’ of service. You have little control over this in 2019. Your duty as manager or employer is not to retain good hires as long as possible, but to give them an amazing two to three years with you.
Here are three simple ways to foster continuous learning and development:
- Always be reading a book, and at least once per week write about what you’re getting from it.
- Take a ‘Learning Day’ each month, ideally funded by the business.
- Participate in a team Offsite every quarter, involving external consultants teaching a variety of new skills.
There’s a great quote, the source of which seems lost:
Manager 1: “Why should we take the time to train employees? What if they just quit soon after?”
Manager 2: “What if you don’t train them and they stay.”
Don’t focus blindly on your attrition statistics. Increasing attrition may mean that you’re evolving faster than before. Or that the new direction you’re going is not the cup of tea of the old brass. If your company isn’t evolving or growing, then one would hope increasing employee attrition was the first symptom of your stagnation.
Economic circumstances and legacy hierarchies can mean that a pay rise or promotion isn’t possible every 12 months.
But that doesn’t mean that you can’t deliver your employees personal growth. It requires investment and it requires putting aside BAU for a couple of days each month. But if people are your biggest and best asset, then there’s a meaningful ROA to be had.
Don’t be afraid of employees leaving you. Be afraid of not fulfilling your promise of personal development. Be delighted when employees leave you with a smile on their face and a glowing reference, knowing that they can now add more value to the world.
About the author
Julian Cook is the founder of Howamigoing