An important strategy for organisations to use in an economic downturn is a proactive Retention Risk Assessment. Research indicates that companies downsizing by more than 10% usually experience consequent voluntary turnover rates of 50% or more of surviving employees in the following year, compared to companies that don’t downsize (Trevor & Nyberg, 2008). It should be considered that lower turnover rates, due to fewer opportunities, can in fact be the “lull before the storm”.
Retention of staff represents one of the highest returns on investment of any HR initiative. A Retention Risk Assessment can be undertaken within your organisation, particularly if you wish to target and retain your key talent (for more information on managing key talent refer to Talent Management). The cost of staff turnover can be very substantial, varying between 2.5 to 10 times the salary of the job in question (Cascio, 1991; Mercer Delta, 2006), and a Retention Risk Assessment minimises the risk of staff turnover.
Ferris Psychologists have a specialist focus on analysing organisations and their people, and devising strategies not only to recruit people, but how to motivate, develop and make the most of the people you currently employ. Following a Retention Risk Assessment, we can offer a tailored program based on key areas that need to be addressed that will have a quantifiable impact on your employees’ intention to stay. This scientific approach provides confidence that methods produce measurable, replicable and cost-effective results.
Source: “Managing your business’ workforce as Australia emerges from the global financial crisis”: Strategies from the APS College of Organisational Psychologists, Australian Psychological Society. http://www.psychology.org.au/community/topics/financial/business/
Cascio, W. F. (1991). Costing human resources: The financial impact of behavior in organizations. Boston: PWS-Kent.
Mercer Delta (2006). Executive Onboarding Research Summary of Effective Practices. Available from www.ivey.uwo.ca/executive/Tal_Dev/Presentations/Executive_Onboarding_Dec06.pdf
Trevor, C. O., & Nyberg, A. N. (2008). Keeping your headcount when all about you are losing theirs: Downsizing, voluntary turnover rates, and the moderating role of HR practices. Academy of Management Journal, 51(2), 259-276.