Goodbye and Good Luck

With employee turnover on the rise, getting the most out of exit interviews is more important than ever.

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At Unicru, they're perfecting the art of saying goodbye. Turnover at the employment-services firm, based in Beaverton, Oregon, isn't rampant; it's about 15 percent a year, consistent with the industry average. Still, that's high enough to be a concern. Unicru's work force has been growing fast--from 136 in 2002 to 271 in 2005--and the market for tech and management talent in the Pacific Northwest has been tightening. So when employees decide to leave, Unicru does everything it can to understand why--and whether the company could have done anything to keep them.

A two-person team has been assigned to exit interview duty. Each departing employee goes through the same 15-question, 90-minute process. The interview is friendly but probing, and the HR department keeps a close eye on the results, looking for trends that might otherwise have gone unnoticed. Many departing employees, Unicru has learned, were put off by a lack of opportunities for professional development and career advancement. (Unicru now invests heavily in those areas.) "We find most employees are eager to be honest because they feel their opinion might help us improve," says Elaine Lees, the company's vice president of human resources.

Nearly all companies conduct some kind of exit interview with employees who leave the fold. But many treat it more as a perfunctory rite of passage than a strategic management tool. That's a mistake. Exit interviews give managers a key opportunity to get an accurate read on the pulse of the organization, providing insights that can be used to stem further turnover. "It used to be the main point of an exit interview was to find out why people were leaving," says Richard Harding, director of research at Kenexa, a consulting firm in Wayne, Pennsylvania. "The new thinking is to turn it around and figure out why good people want to stay."

That's especially important in today's labor market, which is characterized by low unemployment and a new generation of employees who no longer expect to remain with the same company for long. According to a recent study by Monster Intelligence, 40 percent of companies said turnover had increased over the past 18 months. Meanwhile, the voluntary unemployment rate--what economists call the "quit rate"--has risen to about 2 percent, the highest level since November 2001, according to the Bureau of Labor Statistics.

Mining your departing employees for insights into your company can reduce some of turnover's sting. At Unicru, HR execs meet with employees a few days before they leave--delving into each worker's motives, attitude, and insights. In the hopes of eliciting candid responses, the HR staffers promise to keep all comments confidential. And they make a point of telling employees that feedback during exit interviews can lead to concrete action plans. "For the most part, even dissatisfied employees who are leaving the company have a feeling of connection with most of their co-workers and genuinely want to see the company improve and succeed," Lees says.

Of course, the success of exit interviews rises and falls with the candor of those being interviewed. It's no secret that some employees simply tell employers what they want to hear in hopes of getting the interview over with or not burning a bridge. And it's hard to blame them. That's why business decisions should never be made based on the comments of any single exiting employee; instead, decisions should arise from trends and patterns that emerge from a number of conversations, says Les McKeown, president and CEO of Deliver the Promise, a consulting firm in Marblehead, Massachusetts, and author of the book Retaining Top Employees. The key to getting useful information, he says, is to treat the departing employee as a trusted adviser rather than a traitor and to keep the session relaxed and conversational. "A lot of companies send in the likes of Bill O'Reilly when who you really want is Charlie Rose," McKeown says.

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