People Don’t Quit Companies, They Quit Managers

Published by MBA Skool Team, Published on June 06, 2013

The basic rule of surviving in this cut-throat market competition is to differentiate oneself from its competitors. The human capital is emerging as a significant competitive differentiate for most companies across industries. It is of utmost importance to find the right mix of employees who fit the organisational needs and have values and goals in alignment with the firm’s vision and mission. This has become a daunting task with huge investment of money time and other valuable resources. Once this task is accomplished, can the employers sit back and relax? The answer is NO. The next step is the retention of these best-fit employees.

When a new recruit joins an organisation, lot of time and money is invested to groom the new joinee, make him/her corporate ready and bring at par with the existing employees. The organization is completely at loss when these employees leave their job once they are fully trained. According to various researches replacing an employee is estimated to cost twice the deportee’s annual salary. Hence, the concept of employee retention becomes strategically important. Employee retention refers to the various policies practices and measures undertaken so that an employee sticks to a company for a maximum period of time.

The various causes of employee turnover can be attributed to compensation, work environment, career growth, relationship, support, etc. Basically these factors can be categorised as pull factors and push factors. Pull factors are those reasons because of which current employee are attracted and get ‘pulled’ to a new work-place. Hence, it includes a better paying job, a career advancement opportunity, etc. Push factors are aspects that ‘pushes’ the employee towards the exit door. They make the person want to leave, make them start thinking about other job options, talking to other recruiters, looking at the job ads in various places like the newspaper, on the internet etc. In some instances employees will even go so far as to leave without a new job lined-up.

There is little that an employer can do about the pull factors as there would always be some or the other competitors who will make offers to some of your employees that you simply cannot match. More attractive career opportunities and job offers would definitely make the present employee almost certain to leave. But to be able to control and minimise the push factors is what differentiates a good employer from the best employer.

One of the major push factors (infact the leading one) is “Bad managers”. The quality of the supervision an employee receives is a critical aspect of employee retention. People leave managers and supervisors more often than they leave companies or jobs. It is seen that managers who respect and value employees’ competency, pay attention to their aspirations, assure challenging work, value the quality of work life and provided chances for learning prove to have more loyal employees under them. Therefore, in today’s scenario managers play an active and vital role in employee retention.

The first step taken by managers who successfully retain their valuable staff is by communicating clear expectations to the employees. They share their vision of what constitutes success for the employee, both in terms of expected deliverables and the performance of their job. They also provide clarity about career growth and earning potential within the organisation. These managers provide regular feedback about their performance and other aspects, and make the employee feel important and valued. They provide a setting within which the employee perceives he/ she can succeed. The employees in turn feel empowered, enabled, and confident about themselves, the job and the organisation.

But in most cases the managers are too late in understanding their role in the process of employee retention. Only time managers think about retention is when a valued employee departs. They take notice of the situation when there are resignations piled and there is a domino effect on rest of the staff. In reaction theses managers try to talk the employees out of leaving the organisation. These types of managers prove detrimental to the organisation as they are unable to realise that the solution is not short-term but a long term and an on-going process, that the problem doesn’t lie within the employee or the system but within themselves.

Hence, organisations are more and more focussing on identifying and developing managers who believe in as well as act in ways that support employee retention. Various trainings in core management skills are also provided to every manager. These include:

  • integrating the core values of the employee with the VMG of the company,
  • making the decision making process more participative,
  • integrating performance management including goal setting,
  • creating a motivating work environment,
  • process of giving and receiving proper feedback,
  • handling employee grievances,
  • conducting career development discussions with employees, etc.

Teaching a manger about how to value people can be very challenging and difficult but nonetheless it isn’t impossible!

This article has been authored by Poulami Kuila from XIM, Bhuwaneshwar


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