Human Resources: Retaining talent and managing turnover

Limestone College Business

One of our previous posts discussed the critical role HR professionals play in managing involuntary turnover — a scenario in which a company chooses to dismiss an employee due to poor performance, organizational restructuring or other reason.

However, managing voluntary turnover, when an employee chooses to leave a company is just as important, particularly as it relates to HR role in helping an organization retain top talent and minimize recruiting costs.

In South Carolina alone, high employee turnover has affected a number of government departments including Department of Social Services and Department of Juvenile Justice. And according to the Society for Human Research Management (SHRM) guide on retaining talent, “direct replacement costs can reach as high as 50%-60% of an employee’s annual salary.” Some of the costs that are factored into these estimates include HR staff time, disruptions in workflow and new employee training costs among others.

It’s important to remember that not all voluntary turnover is bad.

Forbes contributor, Edward E. Lawler III points out that voluntary turnover of some employees may end up saving organization money. In his article, “Rethinking Employee Turnover” Lawler writes, “It is one thing to lose a highly valued, high-performing employee and quite another to lose a disgruntled, underperforming employee whose skills are outdated.” He points to companies like Zappos who even offer new employees exit payments should they realize they are not a good fit for the company.

So how does one ensure that organization’s top performers don’t leave? A SHRM guide offers effective practices for understanding why employees leave as well as strategies for managing turnover among valued workers.

One example SHRM recommends, exit interviews — generally used to collect data on why employees are leaving an organization — can offer an excellent opportunity to uncover valuable information and feedback that can be used to inform the retention management plan. Some of the common HR retention practices include recruitment, selection, socialization, training and development, compensation and rewards, supervision and employee engagement.

At Limestone College, students earning a Bachelors in Human Resource Management will take a number of courses that will provide both the training and the knowledge necessary to effectively manage employee turnover. Some of the courses include HR 311 – Staffing and Labor Relations, HR 303 – Compensation and Benefits, and HR 420 – Staff Development and Training.

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