Case Study 4 – Increased Engagement Leads to Staff Retention

The Challenge

An international resources company reported high levels of employee turnover and requested assistance to identify and implement a plan to address the root cause and manage associated risks of:

• increased exposure to unfair dismissal claims,
• increase in recruitment spend and time in sourcing replacement team members,
• productivity lag while position vacant and new employees brought up to speed, and
• reduced employee morale due to outflow of colleagues

The Analysis

After determining the level of employee turnover was significantly higher than the industry average, core issues were identified as:

• no SOP in place for managing performance
• lack of awareness of direct and indirect costs associated with high employee turnover
• lack of competence at Manager/Team Leader level in managing poor performance
• frequent knee jerk reactions to employee performance issues resulting in termination decisions

The Action Plan

The following action plan based on short and long-term outcomes was offered:

• training for Managers/Team Leaders to raise awareness of negative aspects of high employee turnover (commercial costs, productivity outcomes and diminished morale) and highlighting benefits on employee retention of adopting approach based on managing performance (including examples from other companies in the resources sector), and
• implementation of cost effective and results-based tactics to complement training:
  – Introduction of 7 step Disciplinary Performance Checklist,
  – SOP on Manager/Team Leader obligations prior to enacting any termination decision, and
  – identifying existing managers with low levels of employee turnover and utilising these as mentors to their peers.

The Positive Outcome

Acceptance and implementation of the action plan resulted in employee turnover reducing from 40% to 11% over a 12-month period.