How to manage employee turnover

HOW TO MANAGE EMPLOYEE TURNOVER Rusty Lindquist Mykkah Herner VP STRATEGIC HR INSIGHTS MODERN COMP EVANGELIST BAMBOOHR PAYSCALE @rustylindquist @mykkah_herner rusty@bam boohr.com MykkahH@payscale.com www.linkedin.com /in/rustylindquist www.linkedin.com/in/mykkahherner "HR today sits smack-dab in the middle of the most compelling competitive battleground in business, where companies deploy and fight over that most valuable of resources— workforce talent." -Matthew D Breitfelder HBR: “Why did we ever go into HR” A Changed Perspective Millennials v 75% Millennials will comprise 75% of the global workforce by 2025 - Deloitte v 91% 91% of Millennials expect to stay with your company fewer than three years – Future Workplace v 2yrs Average tenure for Millennials is years (5 years for Gen X and Gen Y) – Payscale Baby Boomers 43% Within the next 10 years, 43% of the US workforce will be eligible for retirement - Forbes 1yr Among the jobs that 39-44 year olds began, one third ended in less than a year – Forbes 90200% Cost of replacing an employee is between 90-200% of their annual salary – SHRM Contingent Workers 83% 83% Of executives say they’re increasing contingent workers - Oxford Economics 23m There’s projected to be 23 million contingent workers by 2017 (up 26% in years) 52% 52% of Millennials expect to work independently (82% in emerging markets) – MBO Partners – Deloitte Additional Dynamics • Workforce competency and skills gap • Increased competition • Globalization • Culture • Competition for talent • Stresses on work-life balance • Etc –Bersin by Deloitte –Ram Charan Best-selling Author, World-renowned Business Advisor Engagement goes beyond satisfaction Engagement occurs when we find meaning, autonomy, growth, impact, and connection MAGIC in what we Common Engagement Elements • Purpose Alignment • Feel Valued • Culture Alignment • Compensation • Personal / Professional Development • Reward & Recognition • Learning and growing • Sense of winning • Clear career path • Keeping Score • Loyalty • Common Enemy • Leadership • Sense of Belonging • Team / Peers • Tribes • Customers • Friends / Personal Connections • Work • Sense of pride • Investment / Ownership (skin in the game) • Community • Effort • Time • Equity Setting up your comp plan for success Comp as a Keystone Components of Comp Solid Base Pay Plan Clear Strategy Incentive Plan Competitive Market Pay http://businessmodelalchemist.com/blog/2011/11/make-your-business-model-clear-with-vivid-thinking-guest-post-by-dan-roam.html What compensation mix is right for your org? Compensation Strategy Talent Market(s) Level of competitiveness What to reward Industry, Size, Location How aggressively to pay Performance, Experience, etc What about variable pay? Most give bonuses: More than 1,000 Employees 100 - 1,000 Employees Less than 100 Employees 81% of top performing companies 74% of all companies Retention bonuses Hiring bonuses Individual incentive bonuses Team incentive bonuses Spot bonuses or other discretionary bonus programs Recruitment & Retention Plans Plans to recruit and retain high-performing employees All Top Performer 63.4% 59.7% 58.2% 54.6% 35.3% 38.8% 28.1% 18.3% 32.2% 21.3% 13.3% 14.0% Merit-based pay Non-discretionary plan incentive based pay plan Discretionary bonus plan Stock option/grant plan Learning and developmental opportunities More perks-gym memberships, catered lunch, etc Immediate Actions  Calculate turnover rate  Identify good and bad turnover  Brainstorm retention efforts that work  Evaluate your comp plan – does it align with org objectives for retention? Thank you! Follow BambooHR and PayScale on social media: bamboohr.com/blog | payscale.com Questions? BambooHR Receive a free job posting on our ATS and full HRIS for one week We will contact everyone within the next few days to set this up PayScale Download our free 2016 Compensation Best Practices Report at http://www.payscale.com/cbpr Rusty Lindquist Mykkah Herner VP STRATEGIC HR INSIGHTS MODERN COMP EVANGELIST BAMBOOHR PAYSCALE @rustylindquist @mykkah_herner rusty@bam boohr.com MykkahH@payscale.com www.linkedin.com /in/rustylindquist www.linkedin.com/in/mykkahherner ... Nimble to market changes Cost to replace Common Myths of Employee Turnover Myth: Turnover is Always bad Myth: Turnover is Bad for Morale Myth: We can predict turnover based on generation Myth: Turnover. .. others Adding Good Complexity Good Turnover vs Bad Turnover Low performer High Performer Voluntary X% Y% Involuntary P% Q% Retention is still a Major Concern Turnover costs more than just dollars... dead weight align activities to strategic outcomes Organize your information Measure and report to lay a foundation for insight the value and impact of your work Automate the operational Solve