Want To Reduce Employee Turnover? Look at Your Culture

Gustavo Grodnitzky Employee Engagement, Organizational Culture

Turnover in business is like leaving your doors and windows open on a cold winter day. You can still heat your house, but it will cost you. And you can save a boatload on your heating expenses if you just close your doors and windows.

The U.S. Department of Labor cites the top two reasons that businesses fail:

  1. They run out of money
  2. Turnover

It fascinates me how this costly expense is so avoidable but often so ignored. Reducing avoidable turnover is like closing our doors and windows on a cold winter day. In business, that means building a strong culture.

Want proof?

Consider these two graphs from the Work Institute’s 2019 retention report:

Since 2013, the fastest-growing reason that employees are leaving their jobs is organizational culture.

Another big reason for voluntary departures is managers’ unprofessional behavior.

While there was a dip in this reason between 2017 and 2018, it was still the fastest-growing reason for voluntary departures between 2010-2017.

You may have heard some variation of this familiar quote: “People don’t leave companies; they leave bosses.”

But that statement is a leadership excuse for a poor culture. Poor cultures allow poor managers to remain in place without modifying their behavior. A strong culture communicates, explicitly and tacitly, the behaviors required of managers. Those who can’t reliably display those behaviors don’t get to be managers.

The report goes on to say that employers could prevent 77% of the reasons employees leave voluntarily. Reducing preventable turnover in the U.S. by 10% would save $47 billion; reducing it by 20% would save $95 billion.

How much could you save by building a better culture that reduces turnover? Or are you OK with leaving your doors and windows open on a cold winter day?

I’d love to hear your questions and comments. If you would like to discuss this topic further, just drop me a note.

Keep cultivating your culture!