The most valuable internal asset that any business has is its skilled workforce. The employees of a company are what drive a business to fulfill its ultimate goals of delivering the highest quality products or services to its customers and clients. Additionally, many companies aspire to scale appropriately while increasing both the bottom and top lines. In order for this to occur and for businesses to meet their overarching corporate vision – the internal components of a company must seamlessly work together, which requires both tangible and intangible elements to operate effectively. While the invisible elements – the business architecture/design, model, vision, strategic plan, and management organization/structure – are critical, everything comes down to skilled workers remaining productive and efficient in carrying out their workflows and tasks. Without this, a business cannot thrive, survive, scale, or be productive. Businesses must maintain the internal structural integrity of their skilled workforce if they are to remain productive and competitive. Qualified, experienced, high-quality workers are the most critical internal assets of a company. These individuals can even be viewed as positive ROI factors – revenue generators – and when an employee of this caliber departs from a business, adverse financial, structural, corporate, organizational, and managerial effects can result. Ultimately, it is in the best interest of a company to retain their skilled employees and to recognize the signs and causes of a worker that is poised to depart.
When skilled workers leave, a void of sorts can form, requiring a business to spend overhead, time, and money to fill the void with a replacement worker. According to a study by the Society for Human Resource Management, the average cost to hire an employee is over $4,129. Additionally, the timeframe for replacing a departed worker – which can result in a reduction in productivity and financial losses – is around 42 to 52 days. Another study, by Glassdoor, states that the average company spends about $4,000 to hire a new employee.
While statistics show that the modern employee remains with a company for five years on average, employee turnover rates are still an issue that every company must face, especially within specific industries, such as sales, construction, and arts/entertainment organizations, along with restaurants. There is no single reason why high-quality employees leave an establishment, however, even as different industries face different turnover rates, the general reasons why employees leave a business boil down to three major categories:
Workplace Culture: The surroundings can influence a worker’s decision to leave, including the business culture, the way things are done, the corporate atmosphere, and even the business vision.
Managers: Everything from abusive managers to micromanagement tactics can make an employee wish to depart a company, including how management tactically and strategically implements the business vision over time.
Employee: Occasionally, an employee may have personal reasons that may influence his/her decision to leave an establishment, such that no external factors are responsible for the decision.
The reasons (associated with external factors) why employees may leave a business includes:
A lack of trust
Lack of respect or recognition
Lack of opportunities for growth
Poor intra- or interdepartmental communication
Lack of support
An unhealthy workplace environment (or company culture)
A disconnect with company values
Seeing other high-quality employees leave
A disconnect with professional goals
Three primary ways to ensure that competent employees do not leave a business can be broken down into three factors:
Managerial Respect for the Employee: this includes respecting the worker’s talents, skills, time, and finances.
Comfortable Environment: this includes providing a workplace environment that nurtures workers to help them fulfill their tasks and grow.
Operating as a Servant Leader: this includes being an empathetic, caring leader so that all workers fulfill their goals while showing that the leadership cares.
1. Poor Management
There are a few valid reasons why high-quality employees often quit working for a business, which typically includes both a mixture of internal and external factors, the latter of which consists of the workplace environment and leadership. While salary is often touted as a significant reason behind an employee deciding to quit, frequently it is not the money that causes a worker to leave a company, but poor management. Highly skilled workers often look elsewhere for work where their skills and time are valued, and they are respected.
To understand poor management, it helps to understand the roles of a manager, and what a good manager represents. As noted by Henry Mintzberg, managerial roles include:
The work of a manager can be summed up via the acronym LAMDT (Leader, Administrator, Motivator, Delegator, Trainer) – an overseer who leads a team of workers.
In contrast, poor management usually revolves around three core factors:
Trust/Respect: Respecting an employee means utilizing emotional intelligence to help guide him or her in the fulfillment of his or her professional goals. Also helping him or her to complete their tasks without getting in their way, granting them freedom and autonomy in the workplace.
Organization: For a manager to ensure that their department completes the projects and assignments that are necessary for their company’s progress and scalability, the manager needs to be a good leader and guide, and know how to delegate tasks, organize work and projects. A manager should be sure that everyone is on the same page via the use of relevant communication skills.
Value: When personnel do not feel valued, they tend to have lower morale, less motivation, and doubts about where they should invest their time and energy. This often leads to an employee leaving his/her workplace to find employment elsewhere. A valued employee is one who is given the pertinent work that helps them develop and grow, and whose skills are rewarded with an appropriate salary.
When a manager is operating well, a company’s workplace environment is pleasant and organized, and workers can complete their work with little frustration. The hallmarks of a poor manager are chaos, lack of order, and a frustrating workplace environment that may make even the best employees want to leave.
Managers are leaders and should always come to the plate, knowing what needs to be done, how it needs to be done, and who should do it. A manager holds a department or team together and should be on top of his or her game. When this is not the case, chaos, confusion, and lack of harmony ensues, creating an environment where it is hard for high-quality employees to complete their work. This contrasts with a good manager that keeps the peace and creates environmental harmony for employees to work. The most common reason for a worker to leave a company is a bad manager.
Leaders guide team members onto a common, advantageous destination, which requires honesty, good communication skills, excellent teamwork skills, and the know-how to motivate a team to do their constant and consistent best. While bad managers can demoralize employees, poor leadership can cause damage to a team’s morale within a short amount of time by creating a hostile environment where confusion and chaos reign. This means a company can’t reach their goals or scale as teams become inefficient and ineffective in completing key projects and workflows in the absence of a good leader.
One of the most common issues associated with poor management is the tendency of some managers to not trust their workers with how they work, leading them to become overbearing and controlling. This desire to control and manage every small detail of how a worker operates is called micromanaging.
The real issue is a lack of trust and autonomy, which can frustrate employees. A lack of trust equates to a lack of confidence, which can make employees feel their skills are not respected by a manager who is micromanaging.
2. Undervalued and Overworked
The ability for management to assign the appropriate amount of work that suits a worker’s capabilities – delegating the right types of assignments that are not too much or too little in scope – is crucial to retaining the best, high-quality workers in your company. At the same time, when a worker is overwhelmed with work and is given a load that is not advantageous for the worker’s abilities to shine, it can result in frustration and disengagement, low morale, a lack of motivation, and a desire to find work elsewhere.
Being engaged means having a high level of motivation to complete tasks and projects that give an employee a sense of satisfaction when completed. This satisfaction often translates to a feeling of professional growth, while also conveying that their skills are being utilized correctly.
People who feel undervalued or overworked by the company will start to disengage with the company’s goals before they start looking elsewhere. This is partly due to low morale and a feeling that they are not being valued/respected, and so the same attitude will be reciprocated.
3. Lack of Growth Opportunities
Every employee should strive to complete two significant goals:
Help the company grow and scale by being effective, efficient, and productive.
To achieve in their professional aspirations and meet their long-term personal goals.
Workers should always have the ability to grow and expand within the ecosystem of a company. This means rewards, adequate compensation (in the event of overtime work), promotions, and the ability to take on more important tasks and roles within the company when it has rightly been earned.
When a worker is unable to grow or scale their professional career, and they feel stuck in place, frustration can ensue. There are several negative situations where an employee may feel undervalued or unable to grow in the company due to a lack of opportunities or being overlooked. When this happens, it is also possible for the worker to lose motivation and become less productive.
Nepotism and Cronyism
Managers who conduct nepotism and cronyism are bound to frustrate their loyal, high-quality employees to the point that they may leave the company. While nepotism is more of a disposition associated with being prone to favoring friends or relatives, cronyism is the practice of employing, promoting, or giving jobs and better roles (or higher pay) to friends within a workplace, all of which is highly inappropriate. Such positions, salary promotions, jobs/employment, and favoring should be due to hard work and merit. Employees who feel that they are not valued while others (who don’t deserve it) are, will become less loyal, more disengaged, and less productive.
Can’t Pursue Their Passion
Every employee should be allowed to seek their own professional goals (associated with career growth) while integrating the goals of the organization within their daily work, as long as the two don’t conflict. In many situations, the culture, goals, and model of the business is such that workers are entirely unable to pursue professional goals and growth. They feel blocked from taking on tasks, roles, and jobs that may fit in with their own career goals and growth potential.
Instead of helping an employee to pursue their passion (for instance, they may want to learn a new skill and walk a new path in their career), they are limited in a box, resulting in them leaving the company to find a place where they can grow.
Failure To Develop Employees’ Skills
Positive managers should operate as servant leaders, which always helps to ensure that the employees and teams within the organization can evolve in skills and their professional development. If a worker is simply doing the same job month after month, without being trained, learning anything new, or gaining new skills, then he/she may leave to look for better opportunities to grow professionally.
4. Unhealthy Work Environment
One of the main reasons an employee may seek to leave a company is an unhealthy work environment. An environment that is unhealthy may see that the company culture does not fit with the ideals, work philosophy, and work ethic of the employee. An unhealthy work environment may also include everything from abuse and bullying to an atmosphere of negativity and overworked and underpaid employees.
Company culture is a critically important factor in the success and growth an employee will realize in a business. Company culture includes the company philosophy, the mode of operation (“how things are done”), the management style, and the overall environment and business model associated with where the business is going in the short-term and long-term. These factors may not be in line with the personality, skills, work ethic, or professional growth plan of a worker, who may grow frustrated with the internal company culture and wish to leave to find a company that better integrates with his/her career philosophy and personality.
5. Poor Communication
Communication is at the heart of every argument (negative) or agreement (positive), or simply sharing of information (neutral). For a business to thrive, ethical and positive communication principles must be utilized to mitigate arguments and to solve problems, share critical data, and to keep confusion away from the inner-workings of the workplace environment.
For everyone to be on the same page, and for meetings and projects to be successful, positive communication is critical. Misunderstandings can result in projects collapsing, while everyone being on the same page can result in consistent success.
When poor communication is at the heart of a company, frustration and misunderstandings may likely dissuade even a high-quality worker from wanting to remain at a business.
Lack of Empowerment
Poor communication comes in many forms and results in several issues that can spread throughout an entire department. One issue is the inability for workers to express their views or to have their ideas respected or recognized. When this happens, such a lack of empowerment results in a worker being dissuaded from putting forth their best effort. Recognition of a job well done is also key to maintaining positive worker morale. A simple pat on the back or reward of gratitude goes a long way.
Not Checking In Regularly
While micromanaging is an issue within many businesses, it is also essential for leaders and managers to consistently check with their employees to ensure that they are on the right track and are working towards the collective goals. Not caring how one’s employees are doing will lead them to lose interest in the company’s value. If they don’t receive feedback, they may not maintain the high standard of excellence that is needed for them to remain productive and effective at their job, causing errors and a desire to work in a more structured environment.
6. Disconnect with the Company’s Values
Company culture and company values must integrate well with the work ethic and professional philosophy of an employee, or a disconnect with the company’s values may result in a loss of motivation, a decrease in efficiency, and less productivity. Not only is positive feedback necessary for a high-quality worker, employees that do not work in a structured environment may feel that they need to be in a better-organized business.
Constant Structural Reorganizations
Companies that have a defined structure, with a well-organized hierarchy and a well-run system in place, often do well to retain the highest number of employees. Managers who keep their workers in the loop, and companies with a low turnover rate, help to ensure that the business remains steady and stable. If there are frequent management changes that leave employees left out of the loop, issues that give employees reason to leave can present themselves.
Workplace Policies Are Rigid
Workplace policies should create a clearly-defined structure for employees to operate. Still, they should not be so rigid that the worker feels unfree to complete tasks, pursue their professional goals, or utilize their creative freedoms on day-to-day tasks. Overly strict policies often result in frustrated workers who may wish to leave the company.
7. Lack of Trust
Trust is implicitly associated with a manager giving a worker the freedom to work on his/her own without “hand-holding” or micromanaging. This trust also means delegating appropriate tasks to the worker based on skill, while giving the proper amount of support, training, and motivational teaching to ensure that they succeed. Trusting an employee instills a feeling of value and shows a measure of respect.
Lack Of Support
When a manager, or leadership, gives a task or project to a worker, trusting the worker to complete the job does not mean not lending support as needed, or providing feedback from time to time. Truly trusting an employee means knowing his/her skills and limits, and thus when to step in and lend support. Lack of such support can mean a frustrated worker that is unable to operate optimally.
Team Issues or Conflicts
One of the most critical facets of management is the ability to utilize emotional intelligence to foresee conflicts, to mitigate (in a preemptive manner) conflicts, and to resolve existing disputes. This also means fixing – as opposed to ignoring – team issues, which requires honest and transparent communication, respecting everyone’s voice, and ensuring that everyone is on the same page to mitigate communication errors and misunderstandings.
8. Inappropriate Benefits
While certain rewards are appropriate in the workplace to motivate good work, some rewards may be both inappropriate and may dissuade and discourage the supposed recipient or other workers in the workplace. Benefits in the form of services such as the promise of employment or awards should not be utilized to “encourage” good work. Any rewards that may be deemed inappropriate or might be overly “influential”- or like a bribe – can create more problems. Like with cronyism, such improper “favor” may result in honest, good workers wanting out.
9. Work-Life Balance
Sometimes internal, employee-related issues may result in a worker wanting out of a company. One of the main factors associated with internal issues is a worker’s inability to balance work with their life responsibilities or home life and issues. This can include dealing with family, marital life, personal illness, financial obligations or problems, and more. Such an inability to balance life and work may result in undue stress, causing a worker to resign and look for another job.
Mitigating these types of issues may include a workplace “business therapy” or training that helps workers deal with their problems related to work-life balance.
10. Minor Details That Make An Impact
There are a myriad of other personal and external issues that may influence a worker to want to leave a company, including a change in the economy, having children (family issues), needing to relocate, wishing to engage in remote work, wanting a salary raise, etc.
Even the minor details of a person’s home and work life may influence a worker’s desire to leave a company. This includes team-based morale and is related to a company having such a high turnover rate that other workers are dissuaded from wanting to stay, along with other personal, home-life factors.
Seeing Other Employees Leave
The psychology of seeing other high-quality workers leave a company has hardly been explored within the overarching statistics of remaining workers wanting to leave a company afterward. The chances are that if the good employees are leaving, others will often follow suit.
Change In Personal Life
Changes in one’s personal life often cause a well-meaning worker to want to leave a company as well, and often include:
Relocating for family reasons
Starting a family
Empathetic managers will be well acquainted with the personal issues that their workers face and try to mitigate such personal-life issues from causing the worker to leave the company.
Fostering A Well-Organized Environment
Ensuring that the internal affairs of your business operate at peak condition requires that all of your employees work well with a high morale and a positive future outlook associated with their career. Due to the amount of time, money, resources, and even training that is required to onboard new employees into your company, it is always more advantageous to retain high-quality employees. Several critical circumstances may incite workers to leave your business, so it is vital to understand what they are, know how to mitigate them, and to be aware of the signs that foreshadow an employee’s departure. Perhaps the most significant way business can retain employees, is by creating a comfortable, well-organized, nurturing atmosphere. An atmosphere where all workers can operate optimally, effectively, and efficiently on a short-term and long-term basis.
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