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Employee turnover is costly. It’s not just finding and hiring new people or the initial onboarding. In productive and healthy organizations, bonding takes place that improves your performance over time. Bonding just takes time. There’s no real good way to measure some of these costs. But I don’t think there’s a big debate about it; employee turnover is costly.

In this blog, I want to examine some important questions that business leaders are facing as they try to cope with finding good people who want to work in their organizations.

1. Will AI algorithms help or hurt employee turnover?

Ginni Rometty was the CEO of IBM in 2019 when she announced that IBM’s Watson could predict, with 95% accuracy, the people who were most likely to leave your organization. And artificial intelligence has gotten much better since 2019.

Companies, such as Retrain AI and Eightfold AI, are already using big data to help you hire and retain the brightest and best. But this comes with the risk that hiring managers will use the data for malicious intent – to quickly eliminate those who are most likely to leave – without any retention efforts. After all, nurturing teams and employees takes time and energy. It’s not unlike raising children. If you could just create a robot that would do it for you and take the day off, would you enjoy your life more?


Will companies use AI data for malicious intent – to quickly eliminate those who are most likely to leave – without any retention efforts? #management #humanresources #data #businessintelligence #legalissues Share on X

2. Are issues that reduce employee turnover considered board level considerations?

It is becoming clearer by the day that issues such as climate change and sustainability, social justice, and employee wellness can all impact employee turnover.

Union protests, customer complaints, and sickness can all cause chaos in an organization. How can businesses operate so that chaos is manageable? Note that I did not say avoided. We live in a chaotic world. School shootings, wars, community protests, and political unrest abound. Truth is increasingly harder to find – and artificial intelligence is not making that easy.

Corporate boards need to step up to the plate and become engaged on issues that impact employee turnover.

In a 2023 post by Deloitte entitled: The 2023 board agenda, the authors note that social issues are growing.  And it reports that according to the 2022 Edelman Trust Barometer, “business needs to step up on societal issues,” “societal leadership is now a core function of business,” and “business must lead in breaking the cycle of distrust.”

According to a 2022 article by McKinsey & Company, “Positions dedicated to diversity, equity, and inclusion (DE&I) have quadrupled in the past five years in the United States, and no DE&I role is more visible than the chief diversity officer (CDO).” The article goes on to discuss the fact that CDOs have a very high turnover rate. Apparently, few people understand what is expected of the CDO or how it can be measured.

A similar article on the Deloitte site reported that boards need to become engaged in what the organization is doing to support employee wellness.

No company wants to have their operations disrupted by protests, boycotts, or excessive employee turnover. Boards need to get engaged.


3. How should management weigh the trade-off between corporate profits and employee needs?

If you read much about work cultures across the globe you will find that there is little consensus over which comes first – people or profits? There are no easy answers. Giving raises that you can’t afford can endanger a company’s financial position. And allowing people to take the day off whenever they want can make required onsite staffing impossible.

People leave jobs all the time because the boss is impossible. I’ve done it. And most other people reading this blog probably have too.

Emotional intelligence may be the most important skill set that leaders need to acquire. But even with the best of emotional intelligence, business leaders are forced to address challenging questions that pit corporate profit against employee needs. The second skill set might be communication skills.

There are no easy answers on the trade-offs between people and profits. Over time, these complex decisions that you are faced with every day and how you communicate your decisions will impact your employee turnover.

I recommend these three communication guidelines:

  • Build alignment with your key leaders before you announce your difficult decisions.
  • Communicate policy changes one-on-one to those most likely to not like them. And listen to their thoughts.
  • Communicate bad news in person. One-on-one is best, but that may not be possible.
Emotional intelligence may be the most important skill set that leaders need to acquire. The second skill set might be communication skills. #management #projectmanagement #business #leadership Share on X

4. What are the values of your organization? And how do you align your employees behind these values?

Is your company a value-driven organization? I believe that employees need and want to understand which values you stand for. And no company can be for everything. What are the top four values that you believe are core to your being?

Before beginning any value examination, perhaps I should add that you need to understand what the core competencies of your business are. Is project management one of your competencies, or is that an area that you need to strengthen? What about new product development, sales, or legal matters? Once you understand your core competencies, you can begin to identify the values that are critical to you.

If you have never spent the time to understand what your values are, check out this blog on how to create a values-based leadership system.

And then, after your leadership team has engaged a process and identified your values, how will you align your employees? Not everyone will agree on the values that you have selected, but you need to build support for the ones that you adopt. And people won’t remember, just because you’ve told them.

People have short memories for things that are unimportant to them and the values that you and your leadership team select may not be important to everyone that you employ. Engage the project managers and team leads across your organization. Encourage them to build support on their teams. Tell stories. Frequently repeat your efforts to build support.

Are you struggling with employee turnover and looking for guidance? An outside perspective may be helpful. Reach out to chat.