To equip executives with better strategies, we first need to let them in on future projections. It is time to acknowledge that a good percentage of organizations' current workforce turnover will not go away, ever.
Turnover Will Never Go Away
So, what does it mean if we can't stop the revolving door? It means it's time to operationalize our anticipated and unavoidable employee turnover. Plan for it. Budget for it. Staff appropriately for it. It's not going to disappear.
Does this mean turnover will only plateau at its highest level? No. It can certainly come back down, but it is unlikely to return to pre-pandemic levels due to the abundance of employment competition and employee access to comparison information. Our recommendation is that organizational leaders begin planning for a more realistic level of annual turnover from this point forward, which will likely be higher than you'd prefer to see. Then, we can determine ways to adjust the current business model in order to remain sustainable long term.
To find your predicted turnover percentage, the right calculation may come from taking your highest turnover during the workforce crisis and cutting that number in half as your new anticipated turnover rate. Or it could simply be going back to your highest percentage of turnover prior to the pandemic. Talk with your general managers and department leaders about what they believe is realistic to achieve and discuss those scenarios.
However, do not be too optimistic with your projections. Expect competition to remain fierce. Expect options to remain available for staff to go elsewhere when they want to make a change. And if you're only budgeting 2-3% for annual cost-of-living adjustments (COLA) (which is not a raise by the way) then expect other companies will be paying more for that same talent you need. With those parameters, what would a realistic projected turnover rate be? If you plan correctly, you can get ahead of the staffing issues versus always feeling behind and underwater.
Once you have the new realistic expectation in the books, and literally in your P&L, we still have much work to do to get down to that lower turnover rate from where we are today. The strategies that follow are proven to help organizational leaders create a place where people want to work, but first you must prioritize your efforts as we can't do it all at the same time.
To make this easy, take this Quick Retention Audit and consider whether your front-line team members would agree or disagree with in the following ten statements right now. Not last quarter. Right now.
Quick Retention Audit
How would STAFF score the following based on a 1 (Disagree) to 5 (Agree) scale right now?
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Our staff feel their managers are effectively communicating.
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Our staff feel our onboarding is effective.
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Our staff trust one another.
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Our staff feel their workloads are manageable.
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Our staff feel our managers listen to their team members.
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Our staff feel they are given flexibility with their schedules.
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Our staff feel their compensation is appropriate for their current role and responsibilities.
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Our staff feel their managers are adequately trained for their current leadership roles.
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Our staff feel advancement opportunities within the organization are accessible within a reasonable time frame.
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Our staff feel the organization's technology (hardware & software) is sufficient for their needs.
Time to Analyze
What stands out as why your new or seasoned staff could be walking away?
How do you feel about your total score? How would each of your general managers likely score based on their properties' team members? Are you confident where you are or did you discover there is room to grow?
If you scored 40 or more, are you an optimist who may need to stop and gauge the feelings of your not-so-optimistic staff at the moment? Or are you truly far ahead of other employers? If it's the latter, you should not be struggling with massive turnover right now, which is great!
If you scored 39 or lower, it's time to choose whether to focus on the lowest 1-2 scores or focus on a few middle scores to determine where you can move the needle fastest. You can't do it all at once, so now you must prioritize.
Which items could be improved with minimal effort? Those are now your small-step priorities that can make a big difference. And, chances are, you already know how to address them; they simply haven't received the needed attention.
Regularly assessing where your organization and leaders stand is an essential part of operationalizing turnover and redefining employee retention. Our workforce continues to evolve, so leaders must stay in tune with their team members over time to successfully retain the talent they cannot afford to lose.
Strategies to Regain Staffing Stability
Many strategies from past decades of success are no longer working, and executives and senior leaders must think differently about solving workforce problems. Today's new workforce, tightened labor market, and advanced technologies are all game changers.
And before we share new strategies that can work in today's evolved environments, let's address the, "where's the money coming from to pay for that?" rebuttal. Most organizations we work with are currently spending hundreds of thousands of dollars on excessive turnover in overtime, temp agency use, and replacement of burned-out key leaders. Most of that already shows up in some way on the P&L so it's time to shift those dollars to more proactive, sustainable solutions such as adjustments and additions for proper staffing.
Of course, the following strategies in addition to pay increases demanded by staff will mean taking a painful financial hit against the healthier profit margins we enjoyed in previous decades. But if your past recruiting and retention approaches are no longer working in the new labor market, more cost cutting certainly will not get you to successful staffing stability.
1. Who Owns Retention?
When retention is deemed everyone's responsibility, no one truly owns the tasks and metrics associated with reducing turnover. More organizations today are finding success when they designate (or hire) a dedicated local or regional Retention Specialist instead of simply putting this entire burden on the general managers. This person drives the workforce retention conversations and leads initiatives for managing the inevitable churn to not only determine ways to reduce it, but also operationalize and plan for the new forecasted turnover rate. This person is given time to genuinely check in with new hires to learn why they stay, hear what frustrates them, and mentor them for creative career advancement within the organization. Those in this role support department leaders in becoming better bosses, and they lead longer-term retention-focused projects.
In working with several organizations to create the appropriate job description and expectations for this role, we have seen it work wonders for releasing the burdens on overloaded leaders.
2. Hire More Before They Quit
While at the moment, it seems impossible to find enough candidates to fill vacant roles, that will settle and when it does, plan to hire ahead of each department's needs.
If we expect continuous churn on our room attendant team, for example, why wait until people leave to search for their replacements? If we predict a department of six staff will have no less than 33% turnover moving forward, we should continuously recruit for those two positions throughout the year, even if we fill all the positions at a given point.
We know someone is going to quit in the near future, which would leave the team understaffed again and team members are tired of that never-ending backfill approach that leaves them continuously scrambling. They want bench strength to call up to play when they are short. They want time for cross-training so help can be pulled from one department to another. They know it takes weeks, at a minimum, to get a new hire up to fully independent productivity, which means they need new folks coming into most departments to learn before others leave.
If organizations refuse to bring back the staffing cushion we had long ago that allowed for proper onboarding, cross-training, and mentoring, they will continue to lose great talent who remain frustrated over the constant lack of appropriate, well-trained staff.
3. Invest in Management Development
While we're seeing an uptick in this investment now, many companies still have not reinstated the training and development for managers that they cut years ago due to a lack of budget and/or lack of time available for training. This is now haunting those employers because they have hired and promoted people into leadership positions without having given them the tools to be successful in their roles.
Managers at every level must continue to learn, grow, and evolve with the workforce if organizations want to both lower current turnover rates and create a place where people want to come back tomorrow. Remember, everyone is hiring!
Have you recently revisited the amounts you have budgeted for and invested in your managers so your organization can solidify the culture you want to have? Are sufficient hours built into managers' job descriptions so they can continue to develop themselves and their team members within their regular work week? Or is development an afterthought often shoved to the back-burner because the appropriate dollars and/or time have not been allocated to get your organization where it needs to be?
Escaping the Never-Ending Cycle
Keep in mind your leaders at nearly all levels have been dealt hit after hit these past two years, and have lost nearly all stability in their personal and professional lives. It's important to acknowledge that any "light at the end of the tunnel" is now deemed a mirage.
Our new goal as leaders should be to minimize the continued scrambling to fill shifts. It's exhausting for everyone. We must invest in ways to gain staffing stability over time by planning and budgeting appropriately for what's ahead instead of skimping on true investments needed to stabilize our hospitality teams.
It's time to give our general managers and department leaders their jobs back by rerouting and/or pruning some of their responsibilities and working toward more realistic and sustainable workloads for all. If we can do that, we may not get back to exactly where we were with retention in prior years, but we will allow the leaders to stop scrambling and gain some level of stability again.
What's your next move? Will you keep expecting operations to go "back to normal" or are you ready to operationalize a new level of realistic turnover for greater long-term sustainability?
By Cara Silletto Founder, Magnet Culture
