While it is well known that employee turnover is a major source of loss for organizations, the actual scale of cost often goes underappreciated.
According to the Center for American Progress, turnover costs employers an average of 20.7% of an employee's salary when they leave. The costs only go up from there as the level of skill and seniority increases.
Further, due to the tightening labor market, there is more cause than ever to be concerned about your best talent leaving. Today, professionals in a range of industries essentially have free reign to move elsewhere when they become discontent.
So, with everything that's on the line, who do we look to ensure employee retention? The answer is middle managers.
75 percent of people quit because of their boss
According to Jim Harter, Chief Science Officer at Gallup, managers account for 70% of the variance in team engagement. Further, based on Gallup's research involving more than a million participants, 75% of people who left a company voluntarily did so because of their manager.
Unfortunately, middle managers are already some of the most stressed members of any organization. As Rachel Rosenfeldt, Director at Kotter, asserts, "Too often, middle managers find themselves squeezed between pressures from above and requests from their direct reports."
Simply asking middle managers to do more would be an irresponsible strategy. Rather, the top-down directives and culture should be oriented toward supporting managers in their efforts.
Lars Minns, head of HR for Mercedes-Benz USA, calls on high-level leaders to invest in their middle management: "Our willingness to invest, without limits, will have a direct effect on the organization and aid in the retention of our best people."
To achieve this, Adam Fridman, founder of ProHabits, a consulting firm that specializes in personal change, notes that big goals are best achieved with little actions. In fact, he has found that when actions are broken up into little chunks they are far more likely to be performed consistently. Since many of the behaviors that lead to increased retention are well-known, organizations can plan to offer strategic nudges influencing these desired behaviors.
This or similar strategies should first be implemented by top-level leadership. Cheryl Mobley, founder & CEO of reCalibrate, states that "Before mandating shifts at the middle manager level -- the leaders at the top must live out the example, not just direct the next level down to 'do what I say, not what I do'."
To get the ball rolling, here are three behaviors that leaders, at any level, can deploy right away to help boost retention:
1. Have meaningful conversations
To keep team members invested in their roles, regular meaningful conversations are imperative. While once a week conversations are usually enough -- some roles may require more frequent discussion.
Many companies are making conversations an essential part of their organizational culture. John Kanoski, CEO of Legal Files, says that "regular conversations help keep our team members aligned with organization-wide goals. Our managers seek to connect personal aspirations with the bigger overall vision of Legal Files."
2. Include people in the decision-making process.
Traditionally, the old autocratic style of management has been effective in getting the business world to where it is today. In the words of Marshall Goldsmith, the premier executive coach of our day, "what got you here won't get you there."
The autocratic method has worked, but the nature of work today along with its workforce has changed. Success in management today requires collaboration -- not command. As Susan Melcher, CHRO of Interactive Health, suggests, "Managers should spend an equal amount of time listening and advising."
Asking people to take part in deciding the goals that they will be a part of is an essential component to engaging employees. While this may come as no surprise to anyone, it is ultimately not nearly common enough in today's organizations.
3. Coach your team.
Among the most vital deciding factors in whether a person stays or leaves is whether they believe their company offers opportunities for growth. This is where coaching comes in -- as coaching is essentially the process of helping others become their best within a particular area of growth.
What coaching means for managers is an approach that involves continuous feedback and discussions about development. This doesn't just involve pointing out weaknesses or flaws, but offering strategies for growth and helping create stretch goals. Along the way, managers should offer encouragement and support rather than criticism or complaints.
The research is quite clear: middle managers have the greatest effect on turnover out of anyone within an organization. As they are already stressed and overworked, the solution is not to simply add more tasks to their plate -- but to cultivate a better orientation towards supporting their daily management responsibilities.