What Does a High Turnover Rate Say About Management?
Employees base decisions to leave their jobs on a number of other factors, from dissatisfaction with wages and career paths to conflict with supervisors. When a company has high employee turnover, the problem is often due to poor management. The company's leadership should engage in both proactive and reactive measures to slow the revolving door through which employees depart.
Employees want a voice. High turnover often is associated with an organization's failure to give employees a medium through which they can voice their concerns and opinions. Employees feel their contributions and feedback aren't important when their employers don't give them the opportunity to give input. Ultimately, employees quit because they don't feel appreciated. In their efforts to reduce turnover, some companies administer employee opinion surveys. Others conduct focus group sessions, brainstorming sessions or brown-bag lunch discussions to encourage employee feedback.
In his book, "The 7 Hidden Reasons Employees Leave," author Leigh Branham says employees leave because they don't trust the organization's leadership, from supervisors all the way up to executive-level leadership. Branham's book discusses reasons why almost two-third of employees don't trust their companies' leaders, based on his analysis of 19,700 exit interviews collected by the Saratoga Institute from 1999 to 2003. High turnover can reflect a number of problems tied to leadership, including discord among the upper management ranks, ineffective leadership and insufficient leadership training. It might also be that management made poor hiring decisions when selecting candidates for leadership roles.
Pay isn't usually the primary reason someone leaves a job, but it does play a role in some decisions to find employment elsewhere. High turnover based on employees looking for better-paying jobs could be due to management's failure to evaluate its compensation structure. It also might be a sign that management isn't rewarding employees appropriately based on their skills and qualifications.
In some industries, high turnover could be a sign that management isn't working hard enough to create innovative solutions. For example, Food Service Warehouse reported that turnover for full-service restaurants soared above 100 percent by 2008. This was a clear sign that restaurant companies weren't doing enough to motivate workers to stay. To correct the problem, companies need to develop innovative training programs, pay incentive packages and flexible scheduling programs to keep workers from leaving.