CHAPTER 7: RETENTION AND MOTIVATION

CHAPTER CASE
Noman S. Satar

Turnover Analysis
You recently completed your company's new compensation plan. You are happy with
the results but know there is more to retaining the employees than just pay, and you
don't currently have a retention plan. Your organization is a large staffing firm,
consisting of several offices on the West Coast. The majority of employees are
staffing recruiters, and they fill full-time and temporary positions for a variety of
clients. One of the challenges you face is a difference in geographical areas, and as
a result, there are differences in what may motivate employees.
As you initially look at turnover numbers, you have the sense that turnover has
increased over the last six months. Your initial thoughts are the need for a better
retention strategy, utilizing a bonus structure as well as other methods of retention.
Currently, your organization pays a straight salary to employees, does not offer
flextime or telecommuting options, focuses on individual performance (number of
staffing placements) rather than team performance, and provides five days of
vacation for every two years with the organization.

Month Separated Total No. of

Employees Employees
Midmonth
March 12 552
April 14 541
May 16 539
June 20 548
July 22 545

1. Calculate monthly turnover for the past six months.

2. What are the possible reasons for turnover in your organization and other
organizations?
3. What steps would you take to remedy the situation?
1. Calculate monthly turnover for the past six months.

Month Separated Total No. of Turnover Rate

Employees Employees
Midmonth
March 12 552 2.17%
April 14 541 2.59%
May 16 539 2.97%
June 20 548 3.65%
July 22 545 4.04%

2. What are the Possible reasons for turnover in the organization and other
organizations?
Here are some reasons:
a. Compensation: unsatisfactory pay and benefits are a major driver of employee
departures. In this case, the company's flat salary structure, without bonuses or
incentives might be fueling the high turnover rate.
b. Culture: a negative company culture can be a turn-off. While details about the
company culture are missing, employees who feel undervalued or disrespected are
more likely to leave for a more positive environment.
c. Job security: fear of losing their jobs can push employees to look elsewhere. The
case study is silent on recent layoffs, but job insecurity can breed instability and
encourage employees to seek a safety net.
d. Management: poor leadership can be detrimental. If employees feel treated
unfairly or their managers lack competence, they may jump ship for better
management.
e. Work-life balance: If employees feel constantly overloaded, they may seek jobs
with better work-life balance. the case study doesn't mention policies on overtime or
flexible work arrangements, which could be a red flag.
f. Work environment: a negative or toxic work environment can be a major driver of
turnover. This could include things like a lack of collaboration, a lot of conflict, or a
feeling of being unappreciated.
g. Remote work: some employees may not be suited to working remotely and may
leave an organization if they are required to do so. On the other hand, some
employees may prefer remote work and may leave an organization that does not
offer it.
h. Personal reasons: sometimes employees leave for personal reasons that have
nothing to do with the job itself, such as relocation, family care needs, or going back
to school.

3. What Steps would you take to remedy the situation?

Some steps to remedy the situation:
a. Conduct an interview insight: conducting exit interviews can shed light on why
employees are leaving. It is the most relevant step to take to understand why
employees are leaving. This can help the organization identify and address the root
causes of turnover.
b. Competitive compensation: reviewing and adjusting compensation and benefits
passage to be competitive with the market is crucial. Here are some other possible
reasons for turnover in the organizations according to passage like unsatisfactory
pay and benefits, job security fears, poor leadership and work life balance issues.
c. Investing in development: providing training programs or tuition reimbursement to
help employees hone their skills demonstrates the company's commitment to their
growth. Here are some training programs like skill specific training, soft skills training
and leadership training. The best type of training will depend on the company’s
needs and the needs of its employees.
d. Open communication channels: keeping employees informed about company
news and ensuring their voices are heard in decision-making processes can improve
communication and morale.