As the new HR Manager, you have put together some preliminary reports for the CEO. One of the reports you compiled focuses on employee turnover. The company you work for is an organization with aggressive expansion goals. In the last 2 years, it has continually hired new employees, yet it has not achieved the staffing levels it desired. The company knew that some employees had left the organization, but turnover rates had not been formally tracked.
After your preliminary fact-finding, you were surprised to discover that the turnover rate for the past year was 38%. You know the CEO will not be pleased with this turnover rate, and you have made the decision to prepare yourself more before presenting the report to the CEO. Because turnover presents a significant cost for an organization, you recognize that this will be an opportunity for you to demonstrate how you can partner with the executive team to turn this situation around and help the company be more competitive. Prepare a short presentation for the CEO on the situation and possible reasons why employees are leaving at such a high rate.
As you are preparing your presentation, consider the following:
In detail, discuss some of the general reasons why employees tend to leave organizations.
You plan to present the financial impact to the CEO. This will help the CEO to get a real sense of the significance of the situation. What factors will you consider in preparing this financial estimate? For this assignment, you are not required to determine the actual dollar figure, but instead, you are to consider what would contribute to the cost of turnover.
Being proactive, what measures can be taken to assess the morale of current employees and how likely they are to leave or stay?
Describe at least 3 methods you could use to measure employee morale.
What are the advantages and disadvantages of each method?
Please refer to the following multimedia course materials:
Unit 1: Human Resource Management
Unit 1: Diversity and Ethics
Unit 2: Human Resources and Personnel
Unit 2: Predicting Performance
Unit 2: Personnel Assessment, Placement
Reasons why Employees Leave Organizations
There are various reasons why employees leave organizations. one of the reasons is poor pay in their current organization. If employees perceive poor pay within the current organization, they are likely to shift to organizations promising higher wages and benefits. Another reason is low motivation. When management fails to create a motivating environment in the workplace, employees may leave the organization. The management style is another crucial factor in determining employee turn over. When there is poor leadership in the organization, employees may feel frustrated and opt to leave the organization. For instance, employees may leave organizations where the managers are abusive or where they are treated in an inhuman way. Another factor could be employee engagement. This refers to the nature of work employees are given. For instance some employees may leave the organization if the work they are given is not challenging enough. A poor company culture may also contribute to employee leaving the organization. When employees are not happy with the culture of the organization, they may likely leave the organization when the opportunity presents itself.
There are various factors to note in preparing the financial estimate. As the HR Manager, it is imperative to examine the recruitment costs. Employee selection and hiring is an expensive and time consuming undertaking. For instance, adverts must be placed in a variety of media which is costly. Another critical factor in preparing the financial estimate is training and development costs. Once the organization acquires new employees, they must undergo training in order to acquaint themselves with the work practices in the organization. Another factor to consider is the productivity costs. High employee turn over leads to loss productive employees. This is because as workers gain more experience in a particular organization, their productivity improves. Lastly, it is important to consider the customer service costs. Customers are more at ease talking with the same kind of employees. This leads to development of customer loyalty.
Several measures can be used to measure employee morale. Conducting a survey can enable the management to identify the level of employee morale within the organization. Questionnaires or interviews can enable the management to establish employee attitude towards the organization. Another way is looking at behavioral indicators such as absenteeism, poor quality of records, tardiness, excessive waste, and among others. Managers can also assess the morale of employees by using specific instruments designed for that role (Amar, 2001). These instruments can measure various aspects such as cooperation, organization, leadership skills, and others. Lastly, managers can assess employee morale by observing their behavior. Observation can give managers clues on the level of employee morale in the organization.
Advantages and Disadvantages using the aforementioned methods to measure employee morale
There are various advantages and disadvantages in using the aforementioned methods to measure employee morale. The main benefit of using surveys is that it ensures anonymity since the respondents do not fill out their personal details. As such, employees are free to provide accurate information without fear of retaliatory action from the management. Surveys may take time to administer. The management can easily assess employee morale using the behavioral indicators since it involves examining their behavior in relation to the workplace. On the flip side, behavioral indicators may not provide reliable data. Using instruments can provide the management with accurate and reliable data. On the flip side, they may be complex to use (Amar, 2001).
Related: Human Resource Law, Job Analysis