Establish Retention & Turnover Goals at the Leader Level

Establish Retention & Turnover Goals at the Leader Level

Most HR departments track employee metrics like turnover, engagement, and retention at the organizational level. That’s a sensible approach – but maybe not the best one.

Consider the fact that bosses are the biggest determinant of employee engagement: according to Gallup polls, one in two employees has left a job just to get away from their manager. In fact, managers account for an astounding 70% of the variance in employee engagement scores.

HR-driven, organization-wide initiatives – say, a team-building exercise designed to promote engagement – might ring hollow if the employee has to go back the next day to deal with problematic bosses.

We’ve written previously about “How do you fix a bad manager?” The key: you must hold them accountable, and that starts with setting employee-related goals at their level. 

This kind of accountability is not about blame; it’s about visibility and gaining insight into where there are problem areas in your organization that can be fixed. In the case of retention, turnover, and engagement issues, it’s about determining if the problem is organization-wide or person- or role-specific. 

We all know that some managers end up in their positions thanks to the Peter Principle: they performed well as individual workers and got promoted as a result, but suddenly found themselves in a position that perhaps demanded skills they lacked. Taking a closer look at their performance creates opportunities for training, education, and personal growth. 

What’s your organization’s goal for employee retention? Take that goal and apply it to each division, down to individual managers, within the organization. That way, you can determine which areas – and individuals – are meeting or failing to meet the organization-wide goal. 

For those failing to meet the goal, the bosses should be addressed by their own higher-ups. 

• Often, it’s not maliciousness; we often associate “bad boss” with “mean boss.” But sometimes it’s just that they lack the skillsets that they need for dealing with their direct reports. 

• Sometimes they’re in the wrong role and would find greater success if they were moved. 

• Sometimes they are genuinely underperforming and termination might be the best course of action.

Regardless, no action will be taken – and no improvement in these employee metrics will be realized – if the organization isn’t taking a closer look at how managers perform.

There’s another reason to applying this metric to bosses. Gallup also found that companies fail to choose the candidate with the right talent for the job 82% of the time. One of the best ways to improve employee metrics is to pick the best boss you can. That means candidates for promotion and candidates for hiring should be explicitly weighed and considered against this goal.

Need more guidance on HR issues? CoAdvantage, one of the nation’s largest Professional Employer Organizations (PEOs), helps small to mid-sized companies with HR best practices, compliance, payroll and benefits. To learn more about our integrated HR outsourcing solution, contact us today.