Fears about retention have been mounting for months, and it's likely that you and others in your company are seriously worried about losing that special someone—that high-performing or high-potential employee who hasn't received a raise in the last couple of years and could, at any moment, decide to move to greener pastures.
Turnover is going to happen no matter what—and it's going to increase as the job market improves.
But you already know that.
You may even have strategies in place to deal with inflated turnover. But once the fence-jumping begins, how will you know your efforts have paid off? The money you invested to improve engagement and retention…was it spent wisely? Your boss will want to know. Your CEO will want to know. You‘ll definitely want to know.
But you already know that, too. The challenge is: how do you actually measure the success of your retention efforts? And how do you stem the cascade of attrition that threatens to take your most valuable employees first?
That's where quality of attrition metrics come into play.
Throughout 2010, several member companies worked closely with i4cp as participants in the Talent Management Exchange (formerly Talent Management Accelerator) to address the challenges of talent management measurement. Quality of attrition was one of four key metrics the peer-driven working group decided to focus on.
Attrition, or employee separation, refers to the end of a worker's relationship with an organization. That separation may be initiated by the employer, as in layoffs and terminations; or it may occur at the discretion of the employee as a voluntary separation or retirement.
But measuring attrition isn't as simple as tracking how many employees have left the company, or even under what circumstances. When it comes to this critical metric—while overall attrition is important to monitor—it's quality of attrition that can make the most meaningful contribution to organizational performance.
You see, you may not care that employee “Bob” quit. He did OK work but is easily replaceable. You may accept that employee “Carl” quit in order to relocate after his wife got a job in the Cayman Islands.
But what about employee “Adam,” whom you tapped for a possible leadership role one day and devoted development resources to? What if he quit because your main competitor was paying more and offering an immediate promotion to a management position?
If you're not tracking those aspects of attrition specifically, you should be. The good news for you is that fewer than a quarter of companies (24%) track high-performer separation rates, with the use of other quality of attrition metrics going downhill from there.
In other words, most companies are missing out on increasingly critical attrition information just like you are.
If you are tracking quality of attrition metrics like high-performer separation rate and regrettable termination rate, however, you're in good company. High-performance organizations are more likely to use separation or attrition measures as strategic tools in their management of talent than their lower-performing peers.
Employees are going to leave your company this year. Some are going to be your best employees. The grass will always look greener on the other side, no matter how much you water, fertilize, and put barbed wire on the fence.
However, you can hedge your losses and determine whether you have a serious attrition problem by building quality of attrition measurements into your talent management strategy. The insights will be powerful, important, easy to communicate and will let management take the steps necessary to make the other side look a little less inviting.