Best practices in managing employee turnover

Defining and Quantifying Turnover... Good Turnover vs.. Common Myths of Employee Turnover... We can predict turnover based on generation... Understand your true worthas a strategic neces

Jennifer Ferris, CCP

Sr Compensation Professional

Mykkah Herner, MA, CCP

Director of ISX Services

www.payscale.com

A Changed Perspective

Millennials will comprise 75% of the global workforce by 2025

Cost of replacing an employee is between 90-200% of their annual salary.– SHRM

• Workforce competency and skills gap

• Increased competition

• Globalization

• Culture

• Competition for talent

• Stresses on work-life balance

• Etc.

–Bersin by Deloitte

–Ram Charan

Best-selling Author,

World-renowned Business Advisor

Defining and Quantifying Turnover

the rate at which people leave a place, company, etc., and are

replaced by others

Good Turnover vs Bad Turnover

Add good complexity

Low Performer

High Performer

Voluntary

Involuntary

Retention is Still a Major Concern

PayScale 2016 CBPR

Retention Compensation

Recruitment

Engagement

Development

Common Myths of Employee Turnover

Turnover is Always Bad

http://lolsheaven.com/

Turnover is bad for morale

Image: https://www.funergizers.com/3-Massive-Mistakes-Which-Lead-to-Low-Staff-Morale

We can predict turnover based on generation

Turnover is always time-consuming and costly

The Role of Corporate Culture in Turnover

Next Gen vs Traditional

Organization

Flexible work environment

Training groundStrong leadershipTransparency of decisions and payIndustry and/or job functionMillennials vs Highly tenured

"HR today sits smack-dab in the middle of

the most compelling competitive battleground

in business, where companies deploy and

fight over that most valuable of resources—workforce talent."

-Matthew D Breitfelder HBR: “Why did we ever go into HR”

Micro Small Mid Large

HR viewed as a cost center

Transactional HR High-Impact HR

HR as a strategic investment

Understand your true worth

as a strategic necessity

Eliminate the unnecessary

shed all the dead weight

Organize your information

to lay a foundation for insight

Automate the operational

set yourself free to do great work

Maximize business value

align activities to strategic outcomes

Solve meaningful problems

learn to think, act, and win like a business.

Measure and report

the value and impact of your work

The Impact of

Turnover on your

Business

Setting Your Comp Plan Up for Success

What is the right compensation mix for my org?

Compensation Strategy

Talent Market(s)

Industry

Size Location

Org type

Level of competitiveness

How aggressively

to pay

What to reward

Performance, Experience,

etc

How do organizations use variable pay?

Individual incentive bonuses

Team incentive bonuses

Spot bonuses

or other discretionary bonus programs

Other (please specify)

PayScale 2016 CBPR

Recruitment and Retention Plans

Non-discretionary incentive based pay plan

Discretionary bonus plan

Stock option/grant plan

Learning and developmental opportunities

More perks-gym memberships, catered lunch, etc

Other (please specify)

2016 Plans for Recruiting and Retaining Top Performers, by Company Size

Less than 100 Employees 100 - 1,000 Employees More than 1,000 Employees

PayScale 2016 CBPR

“I found a salary report on the

internet and it says

I should be paid

more…”

Immediate Actions

 Calculate turnover rate

 Identify good and bad

turnover

 Brainstorm retention

efforts that work

 Evaluate your comp plan –

does it align with org

objectives for retention?

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