We recently wrote about the impacts of HR outsourcing (HRO) on employees, noting that employee turnover was 10 to 14 percentage points lower for companies that used professional employer organization (PEO) services versus comparable companies that did not. That strongly suggests that the HRO relationship benefits employees, but do employees understand the value of what they’re receiving?
Business software giant SAP recently posed an interesting HR question: How well do you manage your employee turnover? They suggested that employee turnover is, in fact, “the ultimate HR test,” noting that as turnover decreases (generally good), average revenue per employee increases (always excellent).
But in our experience, this is a deceptively tricky question.