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The link between employee turnover, retention and engagement

Focus on engaging employees for the here and now
Employee engagement
A truly engaged employee who really wants to do a good job and is committed to the goals and objectives of the organization often works in a state of “flow” or what some might refer to as “the zone.” Shutterstock

By Brian Kreissl

The first question I ask participants when I teach the “HR Fundamentals for the Payroll Professional” course on behalf of the Canadian Payroll Association (CPA) is: “What do you see as your organization’s most pressing people-related issue?”

I invariably get some really interesting answers to that question, which is a really good icebreaker to get participants talking about HR issues and challenges in their organizations (naturally, I only have people volunteer such information if they are comfortable doing so).

Many different issues and challenges surface during these discussions. However, it is interesting to see just how frequently issues crop up that relate to employee turnover, retention and engagement (and sometimes also the ability to attract quality candidates).

A large number of organizations struggle with these types of issues, and it is important to be able to manage and reduce turnover. It is also important to try to engage employees so they remain committed to their jobs, their employers and their own goals.

Managing employee turnover and enhancing retention

Employers obviously need to be able to track, diagnose, manage and limit turnover. This is something organizations track over time and benchmark in relation to other organizations with which they compete for talent.

Turnover can be extremely expensive for organizations with respect to recruitment, onboarding and training costs, as well as lost productivity and organizational knowledge. This applies both in relation to people who leave the organization and with respect to those who have to step up their efforts to cover for the people who left.

Not all turnover is bad and the idea is not to retain employees at all costs. If someone is highly disengaged or there is nowhere for her to go career-wise, it is probably best to have that person exit the organization.

Nevertheless, where turnover is a problem, one of the best ways to reduce turnover is to ensure employees remain engaged. The following section discusses employee engagement and what that entails.

What is employee engagement?

While most of us know an engaged employee when we see one, and I believe the HR profession has started to move towards an agreed-upon definition of employee engagement, to my knowledge there is still no universally accepted definition of employee engagement. However, my own personal definition (or “equation”) of employee engagement is as follows:

Employee engagement = motivation + job and organizational satisfaction + commitment + discretionary effort

A truly engaged employee who really wants to do a good job and is committed to the goals and objectives of the organization often works in a state of “flow” or what some might refer to as “the zone.” This means those individuals are so committed that time seems to fly by and they become totally focused on the task at hand. However, this isn’t about working unpaid overtime or becoming burned out.

Experts in employee engagement and employee surveys point out that we can actually measure and track engagement across organizations and within organizations over time. The problem is that engagement scores are down globally in recent years.

I believe there are a number of reasons for this including the fact that budgets for the types of programs that typically engage employees have been cut. We also see that organizations continue to operate in a “lean and mean” mode and are continually requiring people to do more with less.

Yet, measures designed to engage employees need not cost a great deal. I won’t necessarily go into all of those, but my earlier post from 2011 entitled “30 low-cost ways to boost employee engagement” provides some examples.

But what about employees who are not necessarily going to stay around for the long-term? Is it actually worth trying to engage those individuals?

While very few people these days stay with their employers for 20 years or longer, the idea should often be to try to retain them while they’re still there. One of the ways to do that is to provide meaningful learning and development opportunities so employees feel their skills and qualifications are marketable elsewhere.

If you’re lucky as an employer, that person who would have otherwise left after six months might just decide to stick around for three years. That person also becomes more highly motivated and productive if she is engaged. And that can be a win-win situation for all concerned.

© Copyright Canadian HR Reporter, Thomson Reuters Canada Limited. All rights reserved.

Brian Kreissl

Brian Kreissl is the product development manager for Thomson Reuters Legal Canada's human resources, OH&S, payroll and records retention products and solutions.
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